The Securities Commission has granted an exemption to Desjardins Global Asset Management Inc. (DGAM) and Desjardins Investments Inc. (DII) from certain conflict of interest and self-dealing provisions to enable investment funds regulated under Regulation 81-102 to invest in related non-reporting issuer limited partnerships, specifically DGAM Global Private Infrastructure Fund II, L.P. (Master Infrastructure Fund) and DGAM Global Private Infrastructure Fund, L.P. (Feeder Infrastructure Fund).
The exemptions allow these investment funds to bypass the usual restrictions that prevent registered advisers from causing investment funds to invest in entities where a responsible person or associate holds a significant position, and that prohibit dealer-managed investment funds from investing in securities of issuers with common management, without obtaining client consent or adhering to certain information barriers.
The exemptions are conditional upon compliance with several safeguards, including investment limits on illiquid assets, consistency with the investment fund’s objectives, avoidance of duplicate fees, independent valuation of the infrastructure funds, and disclosure to investors. Additionally, the independent review committee (IRC) must review and approve the investments, and no additional remuneration is provided to the portfolio manager for such investments.
The decision is based on the premise that these investments are in the best interests of the investment funds and are made with business judgment uninfluenced by conflicts of interest. The exemptions are subject to ongoing oversight by the IRC and reporting requirements to ensure transparency and accountability.