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Emerge Canada Inc.

2021-03-09 | Decision | 41-101, 81-102 | Investment funds and structured products | https://www.osc.ca/en/securities-law/orders-rulings-decisions/emerge-canada-inc

National Instrument 41-101 General Prospectus Requirements, ss. 3.1(2) and 19.1. National Instrument 81-102 -- Investment Funds, Parts 9, 10 and 14 and s. 19.1.


The Securities Commission granted exemptive relief to Emerge Canada Inc. (the Filer) and its associated funds from certain prospectus and investment fund requirements, subject to conditions. The relief allows the Filer to offer exchange-traded and conventional mutual fund series under a single simplified prospectus and annual information form, rather than the long form prospectus typically required for exchange-traded funds (ETFs). Additionally, the funds can treat their exchange-traded and conventional mutual fund series as separate entities for compliance with specific parts of National Instrument 81-102 Investment Funds (NI 81-102) concerning sales and redemptions.

Key points include:

1. The Filer is granted an exemption from the ETF Prospectus Form Requirement under National Instrument 41-101 General Prospectus Requirements, provided they file a simplified prospectus and annual information form in accordance with National Instrument 81-101 Mutual Fund Prospectus Disclosure (NI 81-101) for ETF Securities.

2. The Filer is also exempt from Parts 9, 10, and 14 of NI 81-102, allowing them to treat ETF Securities and Mutual Fund Securities as if they were separate funds for compliance purposes.

3. The Ontario Securities Commission is the principal regulator, and the Filer has indicated reliance on Multilateral Instrument 11-102 Passport System in other Canadian jurisdictions.

4. The decision is based on representations from the Filer, including their registration status, the structure of the funds, and their compliance with securities legislation.

5. The Filer must comply with additional conditions, such as including specific disclosures in the simplified prospectus and annual information form and adhering to parts of NI 81-102 relevant to the type of security offered.

The outcome facilitates a more efficient offering process for the Filer’s funds, potentially benefiting investors by providing a consolidated view of a fund’s offerings while ensuring regulatory compliance.