The Securities Commission has granted an exemption to R.E.G.A.R. Gestion Privée Inc. (the Filer) on behalf of its alternative mutual funds (the Alternative Funds) and any future alternative mutual funds managed by the Filer or its affiliates. This exemption allows the Filer to consolidate the simplified prospectus of the Alternative Funds with the simplified prospectus of conventional mutual funds (the Conventional Funds) that are not alternative mutual funds, despite the requirement in subsection 5.1(4) of National Instrument 81-101 Mutual Fund Prospectus Disclosure (NI 81-101) that prohibits such consolidation.
The Filer argued that this consolidation would reduce costs related to renewal, printing, and other processes, and would streamline the distribution and disclosure process across the Filer’s fund platform. The Filer also noted that the Alternative Funds share many operational and administrative features with the Conventional Funds, and combining them in the same simplified prospectus would facilitate investor comparison.
The exemption was granted based on the belief that it is in the best interest of the Alternative Funds and their securityholders and is not prejudicial to the public interest. The Filer also pointed out that similar consolidation is permitted for exchange-traded funds (ETFs) under Regulation 41-101 respecting General Prospectus Requirements, suggesting that mutual funds should not be treated differently.
The decision was made by the Autorité des marchés financiers, the principal regulator in this application, and also represents the decision of the securities regulatory authority in Ontario. The exemption is supported by Section 6.1 of NI 81-101 and is consistent with the test set out in the Legislation for the Decision Makers to make such a decision.