The Ontario Securities Commission granted Fidelity Investments Canada ULC (FIC) exemptions from certain self-dealing provisions under National Instrument 81-102 Investment Funds (NI 81-102) and National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103). This relief allows inter-fund trades in debt securities between Canadian mutual funds, Canadian pooled funds, U.S. mutual funds, and U.S. pooled funds managed by the same or affiliated managers, subject to specific conditions.
Key Facts:
– FIC sought exemptions to facilitate inter-fund trades to optimize trading efficiencies and align Canadian and U.S. regulatory requirements.
– The relief pertains to prohibitions in subsection 4.2(1) of NI 81-102 and subparagraphs 13.5(2)(b)(ii) and (iii) of NI 31-103.
– Conditions include compliance with investment objectives, IRC approval, adherence to U.S. Inter-Fund Trading Rules, and use of third-party dealers for certain trades.
Outcome:
– The Commission granted the requested exemptions, allowing FIC to conduct inter-fund trades under specified conditions.
– FIC must report on these trades biannually to the Ontario Securities Commission.
Relevant Laws:
– National Instrument 81-102 Investment Funds, ss. 4.2(1), 4.3(1), 4.3(2), 19.2.
– National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations, ss. 13.5 and 15.1.
– National Instrument 81-107 Independent Review Committee for Investment Funds, s. 6.1(2).