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Ninepoint Partners LP

2021-04-26 | Decision | Securities Act, 62-104 | Investment funds and structured products | https://www.osc.ca/en/securities-law/orders-rulings-decisions/ninepoint-partners-lp-4

Securities Act (Ontario), R.S.O. 1990, c. S.5, as am., ss. 59(1) and 147. National Instrument 62-104 Take-Over Bids and Issuer Bids, Part 2 and s. 6.1.


Summary of the Securities Commission Decision:

The Ontario Securities Commission granted Ninepoint Partners LP (the Filer) on behalf of Ninepoint Bitcoin ETF (the Proposed ETF) and any future exchange-traded mutual funds (Future ETFs) managed by the Filer or its affiliates, exemptions from two requirements under the securities legislation.

Firstly, the Filer and each ETF are exempt from the requirement to include an underwriter’s certificate in an ETF’s prospectus (Underwriter’s Certificate Requirement), as per section 59(1) of the Securities Act (Ontario). This exemption is based on the understanding that Authorized Dealers and Designated Brokers do not provide typical underwriting services for the distribution of Creation Units, are not involved in the preparation of the ETF’s prospectus, and do not receive underwriting fees from the ETFs.

Secondly, all persons or companies purchasing Listed Securities of an ETF on an exchange in the normal course are exempt from the take-over bid requirements (Take-Over Bid Requirements) outlined in section 2 of National Instrument 62-104 Take-Over Bids and Issuer Bids. This exemption acknowledges that it is impractical for purchasers of Listed Securities to monitor compliance with the Take-over Bid Requirements due to the ongoing issuance and redemption of Listed Securities, and the application of these requirements could adversely impact the liquidity of the Listed Securities.

The decision was made under the authority of sections 59(1) and 147 of the Securities Act (Ontario) and section 6.1 of National Instrument 62-104, with the rationale that the exemptions are consistent with the public interest and the regulatory objectives of the securities legislation.