Mackenzie Financial Corporation et al.

2021-06-16 | Decision | 81-102 | Investment funds and structured products | https://www.osc.ca/en/securities-law/orders-rulings-decisions/mackenzie-financial-corporation-et-al-36

National Instrument 81-101 Mutual Fund Prospectus Disclosure, ss. 2.1 and 6.1(1). National Instrument 81-102 Investment Funds, ss. 3.1, 15.1.1, 15.3(2), 15.6(1)(a)(i)(A), 15.6(1)(b), 15.6(1)(d)(i), 15.8(2)(a), 15.8(3)(a) and 15.9(2), 19.1(1). National Instrument 81-106 Investment Fund Continuous Disclosure, ss. 4.4 and 17.1(1). Form 81-101F1 Contents of Simplified Prospectus, Items 5(b), 9.1(b) and 13.2 of Part B. Form 81-101F3 Contents of Fund Facts Document, Items 2, 3, 4 and 5 of Part I and Item 1.3 of Part II. Form 81-106F1 Contents of Annual and Interim Management Report of Fund Performance, Items 3.1(1), 3.1(7), 3.1(7.1), 3.1(8), 4.1(1), 4.1(2), 4.2(1), 4.2(2), 4.3(1)(a) and 4.3(1)(b) of Part B, and Items 3(1) and 4 of Part C.

The Securities Commission has granted an exemption to a group of new continuing mutual fund trusts (Continuing Funds) from certain requirements under National Instruments 81-101, 81-102, and 81-106, as well as related forms. This exemption allows the Continuing Funds to use the historical performance, financial data, start dates, and fund expenses of their corresponding terminating mutual fund corporation classes (Terminating Funds) in their sales communications, simplified prospectus, fund facts documents, and management reports of fund performance. Additionally, the Continuing Funds are exempted from the seed capital requirements of NI 81-102.

The rationale behind the decision is to facilitate seamless mergers of the Terminating Funds into the Continuing Funds, which are expected to have the same investment objectives, strategies, and fees. The exemption is conditional upon the Continuing Funds including the performance data of the Terminating Funds prepared in accordance with Part 15 of NI 81-102 and disclosing the mergers in their documents.

The outcome of this decision is that the Continuing Funds can present themselves to investors with the established track record of the Terminating Funds, thereby providing investors with historical financial information to inform their investment decisions. The exemptions are subject to certain conditions to ensure transparency and investor protection.