RegAlert2009-06-11
Added · Updated
SEC Division of Corporation Finance no-action letter: Royal Bank of Canada
The Commission grants Royal Bank of Canada relief from being classified as an ineligible issuer under Rule 405 of the Securities Act of 1933, despite its subsidiary RBC Capital Markets Corporation entering a Final Judgment permanently enjoined from violating Section 15(c) of the Exchange Act. This determination, effective as of the entry of the Final Judgment, allows Royal Bank of Canada to maintain its status as a well-known seasoned issuer and retain access to automatic shelf registration and other Securities Offering Reform benefits. The relief is granted based on a showing of good cause, noting that the underlying conduct involved third-party auction rate securities and that RBC Capital has agreed to significant remedial measures, including buying back approximately $867 million of securities.
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
June 11, 2009 DIVISION OF
CORPORATION FINANCE
Mr. George S. Canellos
Milbank, Tweed, Hadley & McCloy LLP
1 Chase Manhattan Plaza
New York, N.Y. 10005-1413
Re: SEC v. RBC Capital Markets Corporation (HO-l 0906) Waiver Request of Ineligible Issuer Status under Rule 405 of the Securities Act by Royal Bank of Canada Dear Mr. Canellos:
This is in response to your letter dated May 6,2009, written on behalf of your client Royal Bank of Canada ("Company") and its subsidiary RBC Capital Markets Corporation ("RBC Capital") and constituting an application for relief from the Company being considered an "ineligible issuer" under Rule 405(1)(vi) of the Securities Act of 1933 ("Securities Act"). The Company requests relief from being considered an ineligible issuer under Rule 405, arising from the settlement of a civil injunctive proceeding with the Commission. The Commission filed a civil injunctive complaint against RBC Capital in the United States District Court for the Southern District ofNew York alleging that RBC Capital violated Section 15(c) ofthe Securities Exchange Act of 1934 ("Exchange Act"). RBC Capital filed a consent in which it agreed, without admitting or denying the allegations ofthe Commission's Complaint, to the entry ofa Final Judgment against it. Among other things, the Final Judgment as entered on June 9, 2009, permanently enjoins RBC Capital from violating Section 15(c) ofthe Exchange Act. Based on the facts and representations in your letter, and assuming the Company and the RBC Capital will comply with the Final Judgment, the Commission, pursuant to delegated authority has determined that the Company has made a showing of good cause under Rule 405(2) and that the Company will not be considered an ineligible issuer by reason ofthe entry ofthe Final Judgment. Accordingly, the relief described above from the Company being an ineligible issuer under Rule 405 ofthe Securities Act is hereby granted and the effectiveness of such relief is as ofthe date of the entry ofthe Final Judgment. Any different facts from those represented or non-compliance with the Final Judgment might require us to reach a different conclusion. ;n;ti~t Mary Kosterhtz . Chief, Office of Enforcement Liaison Division of Corporation Finance
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