Regulatory Alerts2022-01-20
Regulation to Amend Regulation 81-101 Respecting Mutual Fund Prospectus Disclosure
The Canadian Securities Administrators issued this regulation to amend Form 81-101F3 of Regulation 81-101 regarding mutual fund prospectus disclosure. The amendments specifically delete references to deferred sales charges and remove detailed disclosure requirements related to upfront sales commissions and redemption calculations from the form's instructions. This regulation comes into force on June 1, 2022, streamlining the prospectus disclosure obligations for mutual funds.
REGULATION TO AMEND REGULATION 81-101 RESPECTING MUTUAL FUND PROSPECTUS DISCLOSURE Securities Act (chapter V-1.1, s. 331.1, par. (1) and (8))
- Form 81-101F3 of Regulation 81-101 respecting Mutual Fund Prospectus Disclosure (chapter V-1.1, r. 38) is amended, in item 1.2 of Part II: (1) by deleting, in the first sentence of instructions (1), the words “, deferred sales charge”; (2) by deleting the last sentence of instructions (2); (3) by deleting the last sentence of instructions (3); (4) by deleting, in instructions (4), the following: “In the case of a deferred sales charge, the disclosure must also briefly state:
- any amount payable as an upfront sales commission;
- who pays and who receives the amount payable as the upfront sales commission;
- any free redemption amount and key details about how it works;
- whether switches can be made without incurring a sales charge; and
- how the amount paid by an investor at the time of a redemption of securities is calculated, for example, whether it is based on the net asset value of those securities at the time of redemption or another time.”.
- This Regulation comes into force on 1 June 2022.
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