Regulatory Alerts2021-10-21
Draft Amendments to Policy Statement to Regulation 31-103 Regarding Prohibition of Deferred Sales Charges
The regulator issued amendments to Policy Statement to Regulation 31-103 to align disclosure requirements with the prohibition of deferred sales charges for investment funds. The changes replace references to purchase transactions with redemption transactions to accurately reflect the timing of fee disclosures. Registrants are now required to discuss available sales charge options and explicitly address any applicable redemption fees or short-term trading fees with clients.
AMENDMENTS TO POLICY STATEMENT TO REGULATION 31-103 RESPECTING REGISTRATION REQUIREMENTS, EXEMPTIONS AND ONGOING REGISTRANT OBLIGATIONS
- Section 14.2.1 of Policy Statement to Regulation 31-103 respecting Registration Requirements is amended: (1) in the first sentence of the second paragraph: (a) by replacing the word “purchase” with the word “redemption”; (b) by deleting the words “upon the redemption of the security”; (2) by replacing, in the fourth paragraph, the second bullet with the following: “- the sales charge options available to the client and an explanation as to how such charges work. Any redemption fees or short-term trading fees that may apply should also so be discussed”.
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