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The Canadian Securities Administrators (CSA) published final amendments relating to the modernization of the continuous disclosure regime for investment funds, impacting National Instruments such as National Instrument 81-101 Mutual Fund Prospectus Disclosure, National Instrument 81-102 Investment Funds, National Instrument 81-106 Investment Fund Continuous Disclosure, and National Instrument 81-107 Independent Review Committee for Investment Funds.
The changes made are intended, in part, to improve disclosure and reduce the regulatory burden of certain investment fund continuous disclosure requirements. As an example, the CSA has eliminated some class/series level disclosures from the required investment fund financial statements and made certain changes to Form 81-101F1 Contents of Simplified Prospectus.
New exemptions will also come into effect providing relief from certain conflict of interest reporting requirements, in particular related party transactions, provided similar requirements are satisfied through the filing of a new standardized form less frequently than what is required to be filed in the current form of reports. For more information on these requirements and transition periods, please see BLG's in-depth article here.
Of note, the CSA has postponed replacing the existing annual and interim Management Report of Fund Performance (MRFP) with a new annual and interim Fund Report. In addition, the CSA is not currently adopting its proposals relating to use of the term Fund Expense Ratio (FER), which would combine both the management expense ratio and the trading expense ratio of a fund. The notice of the amendments stated that the CSA is working on a more streamlined Fund Report, and they expect to have a subsequent publication relating to these forms and the FER in the future.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
