The Ontario Securities Commission granted AGF Investments Inc. (the Filer) exemptions from certain requirements under National Instrument 41-101 General Prospectus Requirements (NI 41-101) and National Instrument 81-102 Investment Funds (NI 81-102) for its mutual funds offering both exchange-traded and conventional series under a single simplified prospectus.
Key points of the decision:
1. The Filer is permitted to file a simplified prospectus for exchange-traded fund (ETF) securities instead of a long-form prospectus, provided additional disclosures required by Form 41-101F2 are included.
2. The Filer can treat ETF securities and mutual fund securities as if they were separate funds for compliance with Parts 9, 10, and 14 of NI 81-102, which cover sales and redemptions.
Conditions for the exemptions include:
– Filing a simplified prospectus for ETF securities in accordance with NI 81-101 and Form 81-101F1, excluding the Fund Facts document requirement.
– Including additional disclosures in the simplified prospectus as required by Form 41-101F2.
– Complying with Parts 9, 10, and 14 of NI 81-102 for mutual fund securities as non-exchange-traded funds and for ETF securities as exchange-traded funds.
The exemptions are based on the Filer’s representations, including:
– The Filer is a registered investment fund manager and manages existing and future mutual funds.
– The funds offer or will offer both mutual fund securities and ETF securities.
– ETF securities will be listed on a recognized marketplace, while mutual fund securities will not.
– ETF securities are primarily purchased by Authorized Dealers or Designated Brokers in Creation Units.
– The Filer believes including all series in one prospectus is more efficient and will not impair investors’ ability to differentiate between the series.
The decision allows the Filer to streamline its prospectus process and treat the different series of fund securities appropriately according to their nature, either as exchange-traded or conventional mutual funds, under the relevant securities regulations.