Regulatory Alerts2020-02-20
Amendments to Policy Statement to Regulation 81-101 Respecting Mutual Fund Prospectus Disclosure
Regulatory authorities amended Policy Statement to Regulation 81-101 to mandate specific disclosure requirements for deferred sales charge options in mutual fund documents. The amendments require that fund facts documents and simplified prospectuses clearly indicate the jurisdictions where the deferred sales charge option is prohibited versus where it remains available. Investment fund managers are permitted to offer separate series or classes of securities to isolate the deferred sales charge option in jurisdictions where it is permitted.
AMENDMENTS TO POLICY STATEMENT TO REGULATION 81-101 RESPECTING MUTUAL FUND PROSPECTUS DISCLOSURE
- Policy Statement to Regulation 81-101 respecting Mutual Fund Prospectus Disclosure is amended by adding, after section 4.1.5, the following: “4.1.6. Disclosure of Deferred Sales Charge Option Some investment fund managers offer the deferred sales charge option as one of multiple purchase options available under a single series or class of mutual fund securities. As the deferred sales charge option is prohibited in certain jurisdictions, the fund facts document should provide disclosure to clearly indicate the jurisdictions where the deferred sales charge option is prohibited and where it is available.”.
- This Policy Statement is amended by adding, after section 5.5, the following: “5.6. Disclosure of Deferred Sales Charge Option Some investment fund managers offer the deferred sales charge option as one of multiple purchase options available under a single series or class of mutual fund securities. As the deferred sales charge option is prohibited in certain jurisdictions, the simplified prospectus should provide disclosure to clearly indicate the jurisdictions where the deferred sales charge option is prohibited and where it is available. Investment fund managers may opt to provide a separate series or class of mutual fund securities for the sale of the deferred sales charge option in the jurisdiction where it is available.”.
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