Timely Disclosure

Timely Disclosure

Updates and Commentary on Current issues in M&A, Corporate Finance and Capital Markets

Category Archives: Investment Funds and Structured Products

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The CSA Move Forward on Consultations Regarding the Discontinuation of Embedded Commissions

Posted in Capital Markets, CSA, Investment Funds and Structured Products
On January 10, 2017, the Canadian Securities Administrators (CSA) issued for comment CSA Consultation Paper 81-408 – Consultation on the Option of Discontinuing Embedded Commissions (the Consultation Paper) for a 150-day comment period. The Consultation Paper presents for discussion, the CSA’s position regarding the effects of sales of investment fund securities or structured notes through… Continue Reading

Cross-Border Bond Offerings – Implications of a “distribution to the public” under the Canada Business Corporations Act

Posted in Capital Markets, Cross-Border, Investment Funds and Structured Products, Securities Regulatory Authorities
Economic Environment The volume of securities purchased by foreign investors in Canada has been steadily increasing in recent years.  While equity securities account for the majority of the increase, debt securities still comprise most of the foreign investment in Canada.[1]  Of these debt securities, corporate bonds attracted the largest increase in investment in 2016 compared… Continue Reading

Mutual Fund Risk Classification Methodology Amendments to come into force March 8, 2017

Posted in CSA, Investment Funds and Structured Products
Commencing March 8, 2017, new rules relating to the risk classification of conventional mutual funds and exchange-traded funds (collectively, mutual funds) will come into force. The new rules will primarily involve amendments to National Instrument 81-102 Investment Funds (NI 81-102), but will also involve consequential amendments to National Instrument 81-101 Mutual Fund Prospectus Disclosure (NI… Continue Reading

Canadian Securities Administrators Implement Harmonized Report of Exempt Distribution

Posted in BCSC, Corporate Finance, CSA, Exempt Offering/Private Placement, Investment Funds and Structured Products, OSC, Securities Regulatory Authorities
On April 7, 2016, the Canadian Securities Administrators (CSA) published amendments (Amendments) to the reporting requirements in National Instrument 45-106 Prospectus Exemptions (NI 45-106).  The amendments were previously published for public comment on August 13, 2015.  Concurrently, the CSA published CSA Staff Notice 45-308 (Revised) Guidance for Preparing and Filing Reports of Exempt Distribution under… Continue Reading

TSX Amends Company Manual to Provide New Rules for Closed-End Funds and ETFs

Posted in Capital Markets, Continuous Disclosure, Investment Funds and Structured Products, Stock Exchanges, TSX
The Toronto Stock Exchange (TSX) announced amendments to the TSX Company Manual (Amendments) effective September 17, 2015 relating to the listing of Exchanged Traded Products, Closed-End Funds and Structured Products, as defined in the Amendments. Proposed Amendments were first published on January 15, 2015.  Nine commentators (including Fasken Martineau DuMoulin LLP) provided comments.  A summary… Continue Reading

Canadian Securities Administrators Propose New Disclosure Document for ETFs

Posted in CSA, Disclosure, Investment Funds and Structured Products, Securities Regulatory Authorities
On June 18, 2015, the Canadian Securities Administrators (CSA) published proposed legislative amendments to the disclosure framework for exchange-traded funds (ETFs).  If implemented, such amendments will require ETF managers to produce a summary disclosure document called “ETF Facts”.  The ETF Facts for an ETF will need to be filed at the same time as the… Continue Reading

Capital Markets Participation Fees – OSC Fee Rule Amendments

Posted in Disclosure, Investment Funds and Structured Products, OSC, Public Offering and Exemptions, Securities, Securities Regulatory Authorities
Final amendments to OSC Rule 13-502 Fees and Companion Policy 13-502CP (together, the Rule) were delivered to the Minister of Finance on January 27, 2015 and if approved, will be in force on April 6, 2015. The highlights relating to capital markets participation fees are set out below. Reference fiscal year Previous amendments to the… Continue Reading

Modifications récentes au Règlement 45-106 : Ce que l’industrie des fonds d’investissement doit savoir

Posted in CSA, Distribution Exemptions, Investment Funds and Structured Products, Securities, Securities Regulatory Authorities
Les Autorités canadiennes en valeurs mobilières (les ACVM) ont récemment publié les modifications définitives qu’elles entendent apporter au Règlement 45-106 sur les dispenses de prospectus et d’inscription (qui sera d’ailleurs renommé le Règlement sur les dispenses de prospectus) (le Règlement 45-106). Ces modifications concernent les dispenses de prospectus fondées sur l’investissement d’une somme minimale ainsi que… Continue Reading

Recent amendments to NI 45-106 : What the Fund Management Industry Needs to Know

Posted in CSA, Distribution Exemptions, Investment Funds and Structured Products, Securities, Securities Regulatory Authorities
The Canadian Securities Administrators (CSA) recently published final amendments to National Instrument 45-106 Prospectus and Registration Exemptions (to be renamed Prospectus Exemptions) (NI 45-106) relating to the accredited investor and minimum amount investment prospectus exemptions. Subject to Ministerial approval, the amendments will come into force on May 5, 2015. Key Changes From a fund manager/dealer’s perspective, the key… Continue Reading

CSA Releases Status Report on Proposed Changes to Methodology for Fund Risk Determination

Posted in CSA, Investment Funds and Structured Products, Securities Regulatory Authorities
Overview On January 29, 2015, the Canadian Securities Administrators (CSA) published CSA Staff Notice 81-325 Status Report on Consultation under CSA Notice 81-324 and Request for Comment on Proposed CSA Mutual Fund Risk Classification Methodology for Use in Fund Facts (Staff Notice). As its names  reveals, the Staff Notice was a follow-up to previously issued… Continue Reading

Mise à jour sur l’encadrement des fonds d’investissement alternatifs

Posted in CSA, Investment Funds and Structured Products
Mise à jour sur l’encadrement des fonds d’investissement alternatifs Dans le cadre des efforts menés par les Autorités canadiennes en valeurs mobilières (« ACVM ») en vue de moderniser la réglementation des produits de fonds d’investissement, celles-ci ont publié récemment une mise à jour sur les propositions relatives aux fonds alternatifs. Les « propositions relatives aux fonds alternatifs »… Continue Reading

Update on an Alternative Funds Framework for Investment Funds

Posted in CSA, Investment Funds and Structured Products
Update on an Alternative Funds Framework for Investment Funds As part of their ongoing efforts to modernize investment fund product regulation, the Canadian Securities Administrators (CSA) recently published an update on the status of the creation of an Alternative Funds Proposal. The Alternative Funds Proposal is the CSA’s proposal calling for a more comprehensive regulatory… Continue Reading

TSX Proposes Listing Requirements for Investment Funds

Posted in Continuous Disclosure, Investment Funds and Structured Products, Public Offering and Exemptions, Securities, Stock Exchanges, TSX
On January 15, 2015, the Toronto Stock Exchange (TSX) published for comment proposed amendments to the TSX Company Manual which would introduce listing requirements for non-corporate entities, such as exchange-traded products, closed-end funds and structured products, as those terms are defined in the proposed amendments. The proposed amendments address the following, among other matters: minimum… Continue Reading

A New National Rights Offering Exemption

Posted in Continuous Disclosure, CSA, Distribution Exemptions, Investment Funds and Structured Products, Public Offering and Exemptions, Securities, Securities Regulatory Authorities
On November 27, 2014, the Canadian Securities Administrators (CSA) published for comment proposed amendments to various National Instruments which, if adopted, would overhaul how rights offerings under the rights offering prospectus exemption are conducted. The amendments would also have minor revisions to the requirements of rights offerings conducted by way of prospectus.  The CSA indicate… Continue Reading

Phase 2 Fund Modernization Amendments Now in Effect

Posted in CSA, Investment Funds and Structured Products, Securities Regulatory Authorities
The previously published amendments (Phase 2 amendments) to NI 81-102 as part of the CSA’s fund modernization project are now in effect. For mutual funds, the changes include: a new prohibition against investing in closed-end funds (subject to an 18-month transition period for existing mutual funds), and new sales communications requirements for mutual funds following… Continue Reading

OSC Publishes Annual Summary Report for Dealers, Advisers and Investment Fund Managers

Posted in Continuous Disclosure, IIROC, Investment Funds and Structured Products, OSC, Securities Regulatory Authorities
On September 25, 2014, OSC Staff Notice 33-745 Annual Summary Report for Dealers, Advisers and Investment Fund Managers was published (Report).  The Report is an overview of the main initiatives undertaken by the OSC’s Compliance and Registrant Regulation Branch within the last year and those initiatives underway, with a focus on those registrants directly overseen by the… Continue Reading

OSC Staff Released Guidance for Investment Fund Managers on Sales Practices, Expense Allocation and Other Matters

Posted in Continuous Disclosure, Investment Funds and Structured Products, OSC, Securities Registration and Compliance, Securities Regulatory Authorities
On June 19, 2014, the Ontario Securities Commission (OSC) released Staff Notice 33-743 – Guidance on Sales Practices and Expense Allocation for Investment Fund Managers which resulted from the targeted review of large investment fund managers (IFMs) conducted by Staff of the Compliance and Registrant Regulation Branch of the OSC.  The Notice provides a summary… Continue Reading

New Rules for Closed-End Funds and Mutual Funds Under Phase 2 Fund Modernization Amendments

Posted in CSA, Investment Funds and Structured Products, Securities Regulatory Authorities
On June 19, 2014, the Canadian Securities Administrators (CSA) released, in final form, amendments that will apply a number of new requirements and restrictions to closed-end funds (Phase 2 amendments).  These include: a prohibition against issuing any warrants (whether as part of an initial public offering, or subsequently to existing unitholders), a prohibition against investments… Continue Reading

OSC Staff Release Recommendations Regarding Disclosure of Investment Funds Fees and Expenses

Posted in Continuous Disclosure, Investment Funds and Structured Products, OSC
On May 8, 2014, the Staff of the Investment Funds Branch of the Ontario Securities Commission (Staff) released a notice setting out recommendations based on their observations from a targeted continuous disclosure review of the fees and expenses disclosure practices of investment funds. Staff conducted a targeted, continuous disclosure review of the fees and expenses… Continue Reading

Fund modernization through the back-door

Posted in CSA, Investment Funds and Structured Products
Easily overlooked in the drama of last Friday’s Ontario election call was that the Budget bill which brought down the Liberal government included proposed amendments to extend the conflict of interest investment restrictions in Part XXI of the Securities Act to public closed-end funds.  Last year’s proposed amendments to NI 81-102 and NI 81-104 (Phase… Continue Reading

Fund Facts – Stage 3: Pre-Delivery

Posted in CSA, Distribution Exemptions, Investment Funds and Structured Products, Securities
On Wednesday, the CSA published their proposed amendments to implement Stage 3 of the point-of-sale regime that would require delivery of Fund Facts to investors before purchase orders are submitted.  Highlights of proposed Stage 3 are: Only 2 exceptions to pre-delivery: (i) pre-authorized purchase plans (similar to current simplified prospectus delivery exemption currently in place),… Continue Reading

Canadian Securities Administrators propose further changes to Registration Rules for Dealers, Advisers and Investment Fund Managers

Posted in CSA, Investment Funds and Structured Products, Securities Regulatory Authorities
The CSA announced further changes to NI 31-103 in order to streamline and increase efficiency, with comments due by March 5, 2014.    These changes include the following: Providing guidance on proficiency requirements for those individuals applying as an associate advising representative or as an advising representative Providing guidance on the experience required of a chief… Continue Reading

Canadian securities regulatory authorities propose streamlining disclosure requirements for private foreign securities offerings

Posted in CSA, Investment Funds and Structured Products, Securities Regulatory Authorities
The Canadian Securities Administrators (CSA) published proposed amendments to National Instrument 33-105 Underwriting Conflicts (NI 33-105) last week which will remove in certain instances the need for foreign issuers to provide a Canadian wrapper when distributing foreign securities on an exempt basis to Canadian permitted clients.   The comment period on the proposed amendments ends on… Continue Reading