The Securities Commission has granted exemptive relief to investment funds managed by Fidelity Investments Canada ULC, allowing them to invest in unregistered fixed income securities, known as 144A Securities, beyond the usual limits on illiquid assets. These funds must be qualified institutional buyers as defined by the U.S. Securities Act of 1933, and the securities must be traded on mature and liquid markets.
The decision is based on the recognition that 144A Securities can offer attractive investment opportunities and can be traded freely among qualified institutional buyers, reducing liquidity concerns. The Commission determined that allowing these investments would not compromise investor protection or the funds’ ability to meet redemption requests.
The relief is conditional upon the funds maintaining their status as qualified institutional buyers at the time of purchase, the securities not being considered illiquid under part (a) of the definition in National Instrument 81-102 Investment Funds, and the disclosure of this exemption in the funds’ prospectuses.
The decision is grounded in the provisions of National Instrument 81-102 Investment Funds, particularly sections 1.1, 2.4(1), 2.4(2), 2.4(3), and 19.1, and is consistent with the public interest.