(1) An investment fund must not purchase a security of an issuer
(a) if, immediately after the purchase, the investment fund would hold securities representing more than 10% of
(i) the votes attaching to the outstanding voting securities of the issuer; or
(ii) the outstanding equity securities of the issuer; or
(b) for the purpose of exercising control over, or management of, the issuer.
(1.1) Subsection (1) does not apply to the purchase of any of the following:
(a) a security issued by an investment fund if the purchase is made in accordance with section 2.5;
(b) an index participation unit that is a security of an investment fund.
(2) If an investment fund acquires a security of an issuer other than as the result of a purchase, and the acquisition results in the investment fund exceeding the limits described in paragraph (1)(a), the investment fund must as quickly as is commercially reasonable, and in any event no later than 90 days after the acquisition, reduce its holdings of those securities so that it does not hold securities exceeding those limits.
(3) In determining its compliance with the restrictions contained in this section, an investment fund must
(a) assume the conversion of special warrants held by it; and
(b) consider that it holds directly the underlying securities represented by any American depositary receipts held by it.