Ontario Securities Commission Bulletin
Issue 48/50 - December 18, 2025
Ont. Sec. Bull. Issue 48/50
• Internet Sciences Inc. et al.
• Internet Sciences Inc. et al.
• Internet Sciences Inc. et al.
• RBC Global Asset Management Inc. and The Top Funds
• Mackenzie Financial Corporation et al.
• AGF Investments Inc. and The Top Funds
• Ontario Power Generation Inc.
• Obsiido Alternative Investments Inc. et al.
• Cumberland Investment Counsel Inc.
• Assante Capital Management Ltd. and Assante Financial Management Ltd.
• Temporary, Permanent & Rescinding Issuer Cease Trading Orders
• Temporary, Permanent & Rescinding Management Cease Trading Orders
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FOR IMMEDIATE RELEASE
December 15, 2025
TORONTO -- The Tribunal issued an Order in the above-named matter.
A copy of the Order dated December 12, 2025, Reasons for Decision dated December 1, 2025 and Confidential Order dated December 3, 2025 are available at capitalmarketstribunal.ca.
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Ontario Securities Commission et al.
FOR IMMEDIATE RELEASE
December 16, 2025
TORONTO -- The Tribunal issued an Order in the above-named matter.
A copy of the Order dated December 15, 2025 is available at capitalmarketstribunal.ca.
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Ontario Securities Commission et al.
FOR IMMEDIATE RELEASE
December 16, 2025
TORONTO -- The Tribunal issued an Order in the above-named matter.
A copy of the Order dated December 16, 2025 is available at capitalmarketstribunal.ca.
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BETWEEN:
File No. 2025-29
Adjudicator: |
Andrea Burke |
December 12, 2025
WHEREAS the Capital Markets Tribunal held a hearing in writing to consider the following motions brought by Internet Sciences Inc.:
1. Motion 4, seeking to vary the Reasons for Decision dated December 1, 2025 (the Reasons) and, in the alternative, seeking a confidentiality order that the Tribunal permanently not release the Reasons to the public, and
2. Motion 6 (as well as a Supplemental Submission to Motion 6, or Motion 6A, and a Supplemental to Motion 6, or Motion 6B)(collectively, the Bias Motion) seeking to require a different adjudicator, instead of Adjudicator Burke, or, alternatively, a three-member panel that includes Adjudicator Burke, to adjudicate Motion 4 and also seeking the removal of Adjudicator Burke from any further involvement in the proceeding on grounds of reasonable apprehension of bias or bias;
AND WHEREAS the Capital Markets Tribunal issued a Confidential Order dated December 3, 2025 (the December 3 Order), that the December 3 Order, Reasons and all materials filed with the Capital Markets Tribunal in connection with Motion 4 (the Motion 4 materials) shall be kept confidential pending any further order regarding their confidentiality;
ON READING the materials filed by Internet Sciences Inc. and the Ontario Securities Commission, and on being advised that CNSX Markets Inc. takes no position on these motions;
IT IS ORDERED, for reasons to follow, that:
1. Internet's Sciences Inc.'s Bias Motion is dismissed;
2. Internet Sciences Inc.'s Motion 4 is dismissed;
3. the Reasons, December 3 Order and Motion 4 materials shall be released to the public forthwith.
This Order was originally issued on a confidential basis and later published pursuant to the terms of the Order issued in the same proceeding on December 12, 2025
BETWEEN:
File No. 2025-29
Adjudicator: |
Andrea Burke |
December 3, 2025
WHEREAS Internet Sciences Inc. brought a motion requesting that the Capital Markets Tribunal (1) not release to the public the Reasons for Decision with respect to case management dated December 1, 2025 (the Reasons) and (2) vary the Reasons;
ON READING the correspondence from Internet Sciences Inc., CNSX Markets Inc. and the Ontario Securities Commission, and on being advised that all parties agree that the motion proceed in writing;
IT IS ORDERED that:
1. pursuant to subrule 9(6) of the Capital Markets Tribunal Rules of Procedure (Rules), Internet Sciences Inc.'s motion shall be heard in writing;
2. by 4:30 p.m. on December 5, 2025, Internet Sciences Inc. shall serve and file written submissions on the motion and confidentiality of this Order and motion materials;
3. by 4:30 p.m. on December 8, 2025, each of CNSX Markets Inc. and the Ontario Securities Commission shall serve file a responding motion record, if any, and written submissions on the motion and confidentiality of this Order and motion materials; and
4. pursuant to subsection 2(2) of the Tribunal Adjudicative Records Act, 2019, SO 2019, c 7, Sch 60, and subrule 8(4) of the Rules, this Order, the Reasons, and all the materials filed with the Capital Markets Tribunal in connection with this motion shall be kept confidential, pending any further order regarding the confidentiality of this Order, the Reasons, and this motion.
Ontario Securities Commission et al.
File No. 2025-7
Adjudicators: |
Tim Moseley (chair of the panel) |
Sandra Blake |
December 15, 2025
WHEREAS on December 15, 2025, the Capital Markets Tribunal held a hearing by videoconference;
ON HEARING the submissions of the representatives for each of the Ontario Securities Commission, Desmond Alvares, Marie Rounding, Monique Hutchins, Bruce Friesen, and Lisa Langley, and from Lisa Langley on behalf of Emerge Canada Inc.;
IT IS ORDERED THAT:
1. pursuant to subrule 9(6) of the Capital Markets Tribunal Rules of Procedure objections relating to expert witnesses called by Lisa Langley and Emerge Canada Inc. shall be dealt with in writing and materials shall be delivered as follows:
a. by 4:30 p.m. on December 31, 2025, Lisa Langley and Emerge Canada Inc. shall file and serve on each other party written submissions specifying each of the precise questions that each of the three proposed experts is requested to answer;
b. by 4:30 p.m. on January 12, 2026, the Ontario Securities Commission, Desmond Alvares, Marie Rounding, Monique Hutchins and Bruce Friesen shall each file and serve written submissions, if any, regarding any objections to Lisa Langley's and Emerge Canada Inc.'s expert witnesses;
c. by 4:30 p.m. on January 30, 2026, Lisa Langley and Emerge Canada Inc. shall file and serve responding written submissions; and
d. by 4:30 p.m. on February 6, 2026, the Ontario Securities Commission, Desmond Alvares, Marie Rounding, Monique Hutchins and Bruce Friesen shall each file and serve reply written submissions, if any;
2. a further case management hearing in this matter is scheduled for February 17, 2026, at 9:00 a.m., by videoconference, or as may be agreed to by the parties and set by the Governance & Tribunal Secretariat; and
3. the merits hearing shall commence on March 23, 2026, at 10:00 a.m., at the Capital Markets Tribunal located at 20 Queen Street West, 17th Floor, Toronto, Ontario, and continue on March 24, 25, 26, and 27, and April 7, 8, 9, 10, 13, 14 and 15, 2026, commencing at 10:00 a.m. on each day, or as may be agreed to by the parties and set by the Governance & Tribunal Secretariat.
Ontario Securities Commission et al.
File No. 2025-18
Adjudicator: |
Russell Juriansz |
December 16, 2025
WHEREAS on December 16, 2025, the Capital Markets Tribunal held a case management hearing by videoconference;
ON HEARING the submissions of the representatives for each of the Ontario Securities Commission, Purpose Investments Inc. and Som Seif (Mr. Seif);
FOR THE MOTION, brought by Mr. Seif for disclosure of additional documents and particulars (filed on December 4, 2025), IT IS ORDERED THAT:
1. by 4:30 p.m. on December 19, 2025 the Commission shall serve and file its responding motion record;
2. by 4:30 p.m. on December 30, 2025, Mr. Seif shall serve and file his written submissions and reply motion record, if any;
3. by 4:30 p.m. on January 22, 2026, the Ontario Securities Commission shall serve and file its responding written submissions;
4. by 4:30 PM on February 5, 2026, Mr. Seif shall serve and file his reply written submissions, if any;
5. the motion is scheduled for February 12, 2026 at 10:00 a.m. by videoconference, or on such other date and time as may be agreed to by the parties and set by the Governance & Tribunal Secretariat;
FOR THE ENFORCEMENT PROCEEDING, commenced by the Commission (on September 12, 2025), IT IS ORDERED THAT:
1. by 4:30 PM on January 30, 2026, each of the Respondents shall:
a. serve and file a witness list;
b. serve a summary of each witness's anticipated evidence on every other party; and
c. indicate any intention to call an expert witness, including providing the expert's name and the issues on which the expert will give evidence;
2. by 4:30 PM on March 20, 2026, each of the Respondents shall serve any expert report(s) on every other party;
3. by 4:30 PM on March 31, 2026, the Commission shall serve the affidavit of Jesse Dufour on the Respondents; and
a. The requirements in Rule 29 of the Tribunal's Rules of Procedure are waived and do not apply to the affidavit of Jesse Dufour.
b. The exhibits to the affidavit shall be filed in a separate folder and need not be included in bookmarked PDF volumes, and all exhibits shall each be identified in the affidavit by their document ID and hyperlinked so that each exhibit can be individually accessed. The parties shall test in advance that this formatting of the affidavit makes the exhibits accessible by the Tribunal and all parties.
4. by 4:30 PM on March 31, 2026, each party shall provide the Registrar with a completed copy of the hearing participant checklist;
5. by 4:30 PM on March 31, 2026, each party shall serve on all other parties a book of documents containing copies of the documents and identifying any other things that the party intends to rely on or enter as evidence at the merits hearing;
6. by 4:30 PM on April 13, 2026, each party shall deliver to all other parties any objections to documents, witnesses or expert witnesses contained in the books of documents of all other parties, with reasons; and
a. the parties will attempt to resolve any objections before the final case management hearing scheduled for April 24, 2026;
7. by 4:30 PM on April 17, 2026, any motion made by any party shall have been served and filed, with the exception of any motion regarding expert evidence;
8. by 4:30 PM on April 20, 2026, the Commission shall serve its responding expert report(s), if any, to the Respondents;
9. by 4:30 PM on April 22, 2026, the parties shall provide the Registrar with their joint book of documents and agreed statement of issues and facts, if any;
10. a final case management hearing is scheduled for April 24, 2026 at 10:00 AM, by videoconference, or on such other date and time as may be agreed to by the parties and set by the Governance & Tribunal Secretariat;
11. by 4:30 PM on May 4, 2026, each party shall provide the Registrar with an electronic version of their book of documents containing the documents and identifying any other things that the party intends to rely on or enter into evidence at the merits hearing along with an Index file;
12. by 4:30 PM on May 4, 2026, any motion regarding expert evidence by any party shall have been served and filed, which shall be heard at the merits hearing; and
13. the merits hearing shall commence on May 11, 2026, at 10:00 a.m., at the Capital Markets Tribunal located at 20 Queen Street West, 17th Floor, Toronto, Ontario, and continue on May 12, 14, 15, 26, 27, 28 and 29, 2026, and on June 1-5, 8, and 10, 2026 commencing at 10:00 a.m. on each day, or as may be agreed to by the parties and set by the Governance & Tribunal Secretariat.
These Reasons for Decision were originally confidential as result of an interim confidentiality request filed December 1, 2025 and Order issued on December 3, 2025 and later published pursuant to the terms of the Order issued in the same proceeding on December 12, 2025
Citation: Internet Sciences Inc v CNSX Markets Inc, 2025 ONCMT 17
Date: 2025-12-01
File No. 2025-29
BETWEEN:
Adjudicators: |
Andrea Burke |
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Hearing: |
By videoconference, November 25, 2025 |
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Appearances: |
Linda Chervil |
For Internet Sciences Inc. |
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Andrew McCoomb |
For CNSX Markets Inc. |
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Sandy Lockhart |
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Aliyyah Jafri |
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Kirsten Thoreson |
For the Ontario Securities Commission |
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[1] This is an application, by Internet Sciences Inc., under sections 8 and 21.7 of the Securities Act{1} (Act) to review the decision of a Panel of Board of Directors of CNSX Markets Inc. dated October 29, 2025 (October 29 decision), upholding the August 18, 2025 decision (August 18 decision) of the Canadian Securities Exchange (CSE) Listings Manager denying Internet Sciences Inc.'s application for listing.
[2] On November 25, 2025, a case management hearing was held pursuant to Rule 17(6) of the Tribunal's Rules of Procedure (Rules) for the purpose of scheduling various matters, including the applicant's motions for various relief and the merits hearing of the application. The applicant did not agree with the schedule and mode of hearing for the hearing of the motions and merits application proposed by the respondent CNSX Markets Inc. (CNSX) and supported by the Ontario Securities Commission (the Commission).
[3] I reserved my decision about scheduling and subsequently issued a scheduling Order dated November 27, 2025, which substantially conforms to the schedule proposed by CNSX and supported by the Commission. These are my reasons for making the Order.
[4] The applicant is represented by its CEO and does not have counsel. I explained that there is no requirement to have legal representation and that many matters that come before this Tribunal involve self-represented parties. The applicant confirmed that the Registrar informed it of the existence of the Tribunal's Litigation Assistance Program and Duty Counsel Program, both of which are explained on the Tribunal's website.
[5] I explained to the applicant that it is not the Tribunal's role to provide any party with legal advice. However, the Tribunal is required, as a matter of procedural fairness, to ensure that self-represented parties fully understand relevant procedural matters. Accordingly, I explained several procedural matters arising from the applicant's filed materials, including how applications for a review of a decision typically unfold at the Tribunal and the potential options (from a timing and sequencing perspective) for how interlocutory motions can be scheduled and heard.
[6] I noted that the title of proceeding in the materials filed by the applicant did not conform to the requirements under the Rules.{2} At the hearing, all parties confirmed that the title of proceeding included in the Notice of Hearing issued by the Tribunal on November 12, 2025, is correct. Going forward, all materials filed with the Tribunal should include this title of proceeding.
[7] Based on my initial review of the materials filed by the applicant, I noted that these materials appeared to include several references to non-existent or misstated Rules. I explained that the relevant Rules are found on the Tribunal's website and dated September 17, 2025. I cautioned the applicant that generative AI, if that was used, can hallucinate and may provide inaccurate information. Regardless of whether generative AI is used to assist in the preparation of material, all parties, including self-represented parties, should ensure the accuracy of their materials, including legal citations and references to the Rules and statutory provisions. While I provided one example of what appeared to be a non-existent rule, I explained that it is not the Tribunal's obligation or role to identify such issues for correction by the parties. It is the responsibility of the party to make sure that they are referring to the correct rules and other references. Incorrect or non-existent references will not assist. CNSX volunteered to provide a list of such issues it had identified, so that they might be addressed. The applicant rejected this offer.
[8] I also noted that the grounds listed in the application appear to be narrower than the objections to the October 29 decision and other grounds listed in the applicant's motions in support of its request for an interim stay of the October 29 decision. As a result, it was not clear what grounds the applicant intends to advance on the hearing of the merits of the application. As a procedural matter, all grounds that the applicant intends to raise on the hearing of the merits of the application should be clearly set out in the application in the form of Appendix E to the Rules. As well, in the application the applicant must identify all documents and other evidence not contained in the record of the original proceeding that it seeks to rely upon. The application does not set out any documents or other evidence the applicant seeks to rely upon.
[9] The applicant has filed a motion to be permitted to rely on new evidence. I explained to the applicant that this new evidence motion must address all proposed additional documents and other evidence. When submitting the application, the applicant emailed a number of documents to the registrar in an apparent attempt to provide what the applicant characterized as its application record. Some of these documents are not referred to in the applicant's new evidence motion and do not appear to be part of the record of the original proceeding. It is not evident that the applicant's new evidence motion addresses all documents and evidence not contained in the record of the original proceeding that the applicant may be intending to rely upon.
[10] Due to the deficiencies noted above in the application and motions, I asked if the applicant wanted to make amendments. The applicant confirmed that it would like to amend the application and would like an opportunity to consider whether it wants to amend the motions. The applicant indicated that any amendments could be served and filed by December 3, 2025. Both respondents consented to the applicant being granted an opportunity to amend. Accordingly, the schedule in the Order provides for the amendment of these materials by December 3, 2025.
[11] The applicant filed various motions without accompanying motion records compliant with Rule 21 of the Rules. These motions are:
a. a motion, dated November 11, 2025, filed on November 12, 2025,{3} as supplemented by a "Supplemental Request" dated November 10, 2025 (dated a day before the initial motion) and filed on November 12, 2025 (together, Motion 1) seeking:
i. an interim stay of both the August 18 and October 29 decisions;
ii. an order declaring both decisions "void ab initio" (meaning "invalid from the start") or, alternatively, an order granting a permanent stay of both decisions pending a proper reconsideration by "an independent tribunal";
iii. an order remitting the matter for decision to the Board of Directors of CNSX with directions for procedural safeguards;
iv. an order requiring disclosure by CNSX;
v. an order requiring that the OSC Registrar or Tribunal conduct confidential interviews about specified matters of concern identified by the applicant and prepare a report or, in the alternative, that the Tribunal require further documentary production by CNSX and order CNSX to provide affidavit evidence on various topics which will be subject to cross-examination; and
b. a motion dated November 11, 2025 filed on November 12, 2025 (Motion 2) seeking:
i. an order granting leave to introduce fresh evidence about various specified matters;
ii. an interim stay of both the August 18 and October 29 decisions; and
iii. an order declaring both decisions "void ab initio" for reasons different than those cited in Motion 1; and
iv. an order accepting fresh evidence tendered by the applicant.
[12] The applicant confirmed that a document described as a "supplemental request to Motion 1" sent to the Registrar on November 24, 2025 was not intended to form part of either of the applicant's motions and it was just a "reminder letter".
[13] Some of the relief that the applicant is seeking in the motions (that is, declarations that the decisions under review are "void ab initio", or should be permanently stayed, or should be sent back or remitted for reconsideration with directions) is arguably not something for consideration on an interlocutory motion within an application for review of a decision. This requested relief is akin to the final relief sought by the applicant. I explained this issue to the applicant, pointing to sections 8 and 21.7 of the Act. Subsection 8(4) of the Act (as reflected in Rule 17(3) of the Rules) provides that the Tribunal may grant an interim stay of the decision under review until disposition of the hearing and review. Subsection 8(3) of the Act makes clear that any final relief on an application under sections 8 and 21.7 must wait until disposition of the actual hearing and review. The applicant indicated that it believed that hearing these parts of the motions could entirely obviate the need for a merits hearing of the application.
[14] I advised the parties that I would not schedule for hearing at an interlocutory motion the portions of the applicant's motions that seek final relief. This is not a dismissal of the applicant's requested relief. Instead, the applicant ought to pursue this requested final relief as part of the hearing of the merits of its application. The hearing of the merits of the application should not be bifurcated by having some (but not all) of the grounds for the final relief sought by the applicant considered on an interlocutory motion. Further, such bifurcation also makes no sense when the grounds for such relief may depend on the further disclosure that the applicant is seeking in its motions. The opportunity given to the applicant to amend the application will permit the applicant to ensure that all final relief that it is seeking and all grounds for such relief are included in the application and heard as part of the merits hearing for the application.
[15] For purposes of these Reasons and in my Order, I refer to the balance of the applicant's motions using the following shorthand: a) "interim stay motion" encompassing the portions of both Motion 1 and Motion 2 that seek an interim stay of the decisions, b) "disclosure motion" (encompassing all aspects of the motions that seek disclosure or additional information, including the request for confidential interviews, a report, affidavits and cross-examination on affidavits), and c) "new evidence motion" (encompassing all relief relating to what the applicant has called "fresh evidence").
[16] CNSX submitted that portions of the applicant's motions might be appropriate for summary dismissal under Rule 35 of the Rules. CNSX also submitted that the applicant's motion for an interim stay is neither efficient nor practical. CNSX submitted that the motion for an interim stay can serve no practical purpose and will cause needless delay in the timetable because an interim stay of the decisions will not change the status quo nor will it result in the listing of the applicant.
[17] Although scheduling the interim stay motion (and other interlocutory motions) will necessarily push out the timetable for the hearing of the merits of the application, bringing interlocutory motions is the applicant's prerogative. The applicant understands that an interim stay will not result in the applicant being listed. The applicant's reasons for seeking an interim stay of the decisions relate to addressing or mitigating alleged reputational harm. This can be fully canvassed and considered when the interim stay motion is heard.
[18] The applicant filed its application record by email. Numerous documents were attached to that email, but as noted above the application does not contain a list identifying documents or other evidence additional to the record of the original proceeding upon which the applicant seeks to rely.
[19] The applicant filed the motions by email. Numerous documents were also attached to those emails. The applicant did not serve and file motion records in accordance with Rule 21 of the Rules.
[20] The Commission submitted that the applicant should be required to file motion records that comply with Rule 21.
[21] The applicant submitted that Rule 21 of the Rules does not apply to the applicant's motions and further submitted that the requirements set out in Rule 21 are, in any event, onerous and will cause unnecessary delay if the applicant is required to comply.
[22] Rule 21 of the Rules applies to the applicant's motions. The Rule requires a moving party to serve and file a motion record as soon a practicable for all motions. No motions are exempt from this requirement. A motion record serves the important purpose of neatly organizing and establishing in one place the record of the materials for a motion and makes it easy for all parties and the Tribunal to both refer to and access those materials for the hearing of the motion. That said, the Tribunal has the flexibility to relieve self-represented parties from strict compliance with the Rules where appropriate.{4}
[23] My Order provides the applicant with the option to either serve and file a motion record compliant with Rule 21 or to serve and file a list identifying every document that forms a part of each of the applicant's motions, specifying both the title of the document and the file name of the document.
[24] The option to provide a list of documents in place of a motion record will relieve the burden on the applicant, while still achieving the objective of clearly identifying and establishing which documents form part of the applicant's motions. This option is not preferable to the delivery of a motion record, but it is acceptable in these circumstances.
[25] Where an application contemplates reliance on documents and evidence that are additional to the record of the original proceeding, pursuant to Rule 17(5) a new evidence motion must be brought. In this case it is not clear what new documents and evidence the applicant seeks to rely on for the application. Because of this lack of clarity, I am requiring the applicant to either prepare an application record complying with Rule 21 of the Rules that includes the additional documents and other evidence or serve and file a list that clearly identifies the documents and other evidence additional to the record of the original proceeding that form a part of the application.
[26] The applicant submitted that there should be an expedited hearing of the motions and application with a compressed timeline, primarily because of concerns related to reputational harm while the application is pending. The applicant's position is that both CNSX and the Commission have a lot of resources and should be able to move quickly. The applicant's position about whether the motions should all be heard together or sequentially, and whether some should be heard simultaneously with the merits hearing shifted during the hearing, as did its proposed timetable. In summary, the essence of the applicant's proposed schedule was that the interim stay motion (as well as perhaps the other motions) should be scheduled and heard in writing by December 16, 2025, and the merits application should be scheduled and heard in writing by December 30, 2025. If those timelines were not possible, then the merits application should be completed by mid-January, 2026. The applicant did not suggest any specific filing deadlines for the steps that need to occur between December 3, 2025 (when the application is amended and any amended motions have been filed), in order to achieve this. The applicant only asserted that the timeline be compressed in order for her to get a quick resolution and finality as the lack of resolution is harmful to it.
[27] CNSX submitted that the most efficient schedule is for the applicant's motions to be scheduled and heard together, with the understanding that, in the event that further disclosure is ordered and results in new evidence that the applicant wants to rely upon at the merits hearing, a further new evidence motion can be brought and heard at the same time as the merits hearing. CNSX submitted that given the serious nature of the issues raised in the motions and the application (which include allegations of procedural unfairness, institutional conflict, reasonable apprehension of bias, denial of a fair hearing, discriminatory treatment and material errors) there should be oral hearings of the motions and application. CNSX's counsel referred to Subrule 9(6) of the Rules that deals with written hearings and advised that CNSX does not consent to the motions or application being conducted as a written hearing.
[28] The Commission submitted that the timetable proposed by CNSX is appropriate and that the motions and application should be heard orally, as there are important substantive issues raised in the motions and application. The Commission further submitted that the parties need a reasonable amount of preparation time, and the application is not urgent as there is no live transaction, no pending shareholder vote, the applicant is not seeking to conduct an offering in Canada and there are no plans to raise funds in Canada. According to the Commission, the listing sought by the applicant is for liquidity and visibility purposes for existing shareholders and separate to this application there is an outstanding prospectus receipt issue.
[29] I have concluded that there should be oral hearings, by videoconference, of the motions and the application. The respondents do not consent to hearings in writing and I agree that the motions and application raise significant substantive issues and the procedural issues are not routine. Further, based upon my review of the applicant's materials, I find that the Tribunal will significantly benefit from oral submissions by the parties. The applicant expressed some concerns about attending a hearing in person, and the CNSX and the Commission agreed to the oral hearings proceeding by videoconference.
[30] Because of the following factors, I have determined that the applicant's proposed schedule for a compressed timeline is not feasible or warranted: a) the applicant requires until December 3, 2025 to amend the application and, potentially, the motions; b) the parties require reasonable time to prepare materials; c) the interim stay motion, new evidence motion and disclosure motion need to be heard and decided prior to the hearing of the merits of the application; d) the Tribunal requires reasonable time to review the materials from the parties; and e) the availability of the parties and Tribunal for hearings considering that the timeline overlaps with holidays in December.
[31] I have ordered a schedule that results in a hearing of the motions beginning on January 9, 2026, and the hearing of the application beginning on March 5, 2026. I agree with the Commission that this timeline is not out of line when compared to other similar applications before the Tribunal, especially factoring in the applicant's interlocutory motions which raise a myriad of issues that can impact the application hearing.
[32] Following the release of the Tribunal's decision on the motions, it is open to any party to ask the Tribunal to vary the schedule for the delivery of materials and the hearing for the merits of the application. Depending on the result of the disclosure motion, there may, for example, be a need for the applicant to bring a further new evidence motion that will have to be incorporated in the schedule.
[33] All parties should ensure that their written submissions for the motions and application conform with the requirements in Rule 31 of the Rules.
[34] For the reasons above, I issued the following order on November 27, 2025, which sets out the procedural steps for all parties:
1. by no later than 4:30 p.m. on November 28, 2025, CNSX shall serve and file the record of the original proceeding;
2. by no later than 4:30 p.m. on December 3, 2025, Internet Sciences shall serve and file:
a. its amended motion, if any, for its interim stay motion, disclosure motion and new evidence motion (collectively, the Motions) using the form in Appendix B of the Tribunal's Rules of Procedure (the Rules);
b. either a motion record for the Motions complying with Rule 21 of the Rules, or a list of all documents previously filed and any others filed simultaneously that will be relied upon for each of the Motions at the Motions hearing, specifying both the title of the document and the file name of the document;
c. its amended application using the form in Appendix E of the Rules, specifying the relief sought, all grounds relied on, and listing all documents and evidence in addition to those contained in the record of original proceeding that Internet Sciences seeks to rely on at the hearing of the application; and
d. either an application record complying with Rule 21 of the Rules comprised of the amended application and all documents and evidence, in addition to those contained in the record of the original proceeding that Internet Sciences intends or seeks to rely on at the merits hearing of the application, or a list of all documents and evidence previously filed in addition to those contained in the record of the original proceeding and any other documents and evidence filed simultaneously with the amended application that will be relied upon or that Internet Sciences seeks to rely upon at the merits hearing of the application, specifying both the title of the document and the file name of the document;
3. by no later than 4:30 p.m. on December 8, 2025, CNSX shall serve and file its responding motion record if any, with respect to the Motions, complying with Rule 21 of the Rules;
4. by no later than 4:30 p.m. on December 10, 2025, Internet Sciences shall serve and file its written submissions on the Motions, complying with Rule 31 of the Rules;
5. by no later than 4:30 p.m. on December 15, 2025, CNSX shall serve and file its responding written submissions on the Motions, complying with Rule 31 of the Rules;
6. by no later than 4:30 p.m. on December 19, 2025:
a. Internet Sciences shall serve and file its reply written submissions on the Motions, if any, complying with Rule 31 of the Rules; and
b. the Ontario Securities Commission shall serve and file its written submissions on the Motions, if any, complying with Rule 31 of the Rules;
7. the hearing with respect to the Motions shall commence on January 9, 2026 at 10:00 a.m. by videoconference, and shall continue on January 12, 2026, commencing at 10:00 a.m. or as may be agreed to by the parties and set by the Governance and Tribunal Secretariat;
8. by no later than 4:30 p.m. on January 23, 2026, Internet Sciences shall serve and file written submissions on the application, complying with Rule 31 of the Rules;
9. by no later than 4:30 p.m. on February 5, 2026, CNSX shall serve and file responding written submissions on the application, complying with Rule 31 of the Rules;
10. by no later than 4:30 p.m. on February 12, 2026, Internet Sciences shall serve and file reply written submissions on the application, if any, complying with Rule 31 of the Rules;
11. by no later than 4:30 p.m. on February 18, 2026, the Ontario Securities Commission shall serve and file written submissions on the application, if any, complying with Rule 31 of the Rules; and
12. the hearing with respect to the merits of the application shall commence on March 5, 2026 at 10:00 a.m. by videoconference, and shall continue on March 6, 2026, commencing at 10:00 a.m. or as may be agreed to by the parties and set by the Governance and Tribunal Secretariat.
Dated at Toronto this 1st day of December, 2025.
{1} RSO 1990, c S.5
{2} Rule 13(2) of the Rules requires that where the Ontario Securities Commission is not the applicant, it shall be named as a respondent.
{3} Documents received after 4:30 p.m. are considered received the following business day pursuant to Subrule 6(2) of the Rules.
{4} Rule 3 of the Rules
Joint Canadian Securities Administrators / Canadian Investment Regulatory Organization Staff Notice 31-368 -- Client Focused Reforms: Review of Registrants' Know Your Client, Know Your Product and Suitability Determination Practices and Additional Guidance
December 10, 2025
This is a joint staff notice (the Notice) published by staff of the Canadian Securities Administrators (CSA) and staff of the Canadian Investment Regulatory Organization (CIRO) (together Staff or we).
This Notice summarizes the findings of our review of firms' know your client (KYC), know your product (KYP) and suitability determination practices, and provides additional Staff guidance to securities advisers, dealers and representatives (registrants) for compliance with these requirements, as set out in National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103) and Companion Policy 31-103CP Registration Requirements, Exemptions and Ongoing Registrant Obligations (31-103CP), and corresponding CIRO member rules and guidance.
The CSA, the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association of Canada (MFDA) (IIROC and the MFDA amalgamated as of January 1, 2023 to continue as CIRO) adopted amendments to implement the Client Focused Reforms (CFRs), which made changes to the registrant conduct requirements in order to better align the interests of registrants with the interests of their clients, improve outcomes for clients, and make clearer to clients the nature and the terms of their relationship with registrants.
The CFRs introduced significant enhancements to the registrant conduct obligations, which came into force in two stages in 2021, by amending NI 31-103 and 31-103CP. Each of IIROC and the MFDA also amended their member rules, policies and guidance to be uniform with the CFRs in all material respects.
The CFRs' enhancements to KYC, KYP and suitability determination requirements came into force on December 31, 2021. To assess how firms have integrated these enhanced requirements, the CSA and CIRO conducted compliance reviews (the reviews) of registered firms across a range of registration categories and business models. The observations and guidance outlined in this Notice are to help registrants further align their practices with requirements under the CFRs. We recognize that their specific application will vary based on registration category, business model, and client relationships.
The CSA and CIRO conducted compliance reviews of 105 registered firms to assess their compliance with the CFRs' enhanced KYC, KYP and suitability determination requirements. The sample included firms registered in the categories of investment fund manager, portfolio manager, restricted portfolio manager, exempt market dealer, investment dealer and mutual fund dealer, as well as firms registered in a combination of these categories.
Our reviews were informed by:
• the requirements set out in NI 31-103 and CIRO's Investment Dealer and Partially Consolidated Rules (IDPC Rules) and Mutual Fund Dealer Rules (MFD Rules)
• guidance published in 31-103CP
• the additional guidance set out in the CFRs Frequently Asked Questions (CFRs FAQs)
• MFDA Guidance set out in MFDA Staff Notices (MSN):
• MSN-0048, Know-Your-Product
• MSN-0069, Know-Your-Client (KYC) and Suitability
• IIROC Guidance set out in IIROC Guidance Notices (GN):
• GN-3300-21-001, Product Due Diligence and Know-Your-Product
• GN-3400-21-004, Know-your-client and suitability determination for retail clients
In our reviews, we noted that some firms had invested significant resources in making the changes necessary to adopt the CFRs and made meaningful progress in implementing these requirements, while other firms had yet to update their processes to reflect the new requirements. For firms where compliance deficiencies were noted, we required each firm to take corrective action and resolve the deficiencies within a reasonable time frame. However, in some instances, the non-compliance issues were significant enough to warrant further regulatory action.
Our results highlight the fundamental importance of firms developing policies and procedures to ensure compliance with all aspects of the CFRs. The CFRs are principles-based rules, and firms may develop processes to achieve compliance that are tailored to their operations and reflect their business models. Where we observed firms with effective practices, we have provided examples in this Notice. We have also provided examples of tailored firm processes that successfully met the regulatory requirements. For example, some firms designed centralized processes to assist with meeting certain suitability determination requirements and evidencing compliance, as further described below. Policies and procedures should contain sufficient detail to ensure registrants understand and meet their regulatory obligations, including those at the registered individual, supervisory and firm levels. Firms with up-to-date, comprehensive and tailored policies and procedures and strong compliance oversight minimize the risk of the issues identified in this Notice occurring.
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As noted above, the CFRs set out specific requirements in several areas, including KYC, KYP, and suitability determinations. These requirements involve considering various factors at each level, down to the level of individual investment recommendations. While the requirements are distinct, they are designed to operate in a holistic manner. Although the CFRs require registrants to consider all factors when making individual recommendations, this does not mean that every factor considered must be documented at the individual recommendation level. Documentation is essential to demonstrate compliance; however, depending on a firm's processes, documentation completed through a centralized or periodic process may not need to be repeated each time, provided that the analysis from that process is relied upon when making a recommendation.
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A description of key findings and related guidance is provided in the Notice as follows:
A. KNOW YOUR CLIENT (KYC)
1. Determination of risk profile
2. Collection of financial circumstances information
3. Keeping KYC information current
B. KNOW YOUR PRODUCT (KYP)
1. KYP -- Firm assessments
2. KYP -- Registered Individuals
3. Approval of securities
4. Monitoring for significant changes in securities
5. KYP -- Transfers in and client directed trades
C. SUITABILITY DETERMINATION
1. Suitability determinations and factors to be considered
2. Impact on client's account or portfoli•
3. Impact of costs
4. Reasonable range of alternative actions
5. Inadequate suitability reassessments
6. Client directed trades
D. COMPLIANCE SYSTEM AND TRAINING
1. Policies and procedures
2. Training
A. KNOW YOUR CLIENT (KYC) (Section 13.2 of NI 31-103, IDPC Rule 3200, MFD Rule 2.2.1)
KYC obligations require registrants to take reasonable steps to obtain and periodically update information about their clients to support suitability determinations. Registrants must take reasonable steps to ensure that they have sufficient information regarding all of the matters set out in paragraph 13.2(2)(c) of NI 31-103 (IDPC Rule 3202(1)(iii), MFD Rule 2.2.1(1)(b)).
The amount of detail required in the KYC information collected will vary based on the nature of the firm's relationships with its clients, and the complexity of the securities and services offered by the firm. For example, more extensive KYC information is necessary for customized portfolio management or dealing or advising in complex, high risk, or illiquid securities. Registrants should exercise professional judgement to ensure they have sufficient KYC data to meet suitability determination requirements.
The reviews found that most firms had some processes in place to collect and periodically update KYC information. However, we identified key areas for improvement:
• many firms lacked an adequate process to collect sufficient information from clients about their risk tolerance and risk capacity, and to use that information to determine the client's risk profile;
• some firms failed to collect adequate information about clients' financial circumstances; and
• some firms had inadequate processes to keep KYC information current, including processes to document KYC updates.
1. Determination of risk profile (Subparagraph 13.2(2)(c)(v) of NI 31-103, IDPC Rule 3202(1)(iii)(a)(V), MFD Rule 2.2.1(1)(b)(v))
Firms must determine and document the risk profile of each of their clients. A client's risk profile should consider two factors: a client's "risk tolerance" (willingness to accept risk -- i.e., the client's subjective attitude towards risk) and "risk capacity" (ability to endure financial loss -- i.e., a more objective consideration of how financial loss would impact a client having regard to the essential facts relative to the client, when considered as a whole).
(a) Issues identified
Issues relating to the determination of risk profile for clients noted in our reviews included:
• Unchanged KYC process for risk post-CFRs -- Some registrants had not updated their KYC processes to assess both risk tolerance and risk capacity, instead continuing to rely only on risk tolerance (which was the focus of the requirement pre-CFRs). Additionally, some registrants adequately updated their risk profile process for new clients but did not follow that updated process for existing clients when updating KYC.
• Inadequate process to collect and verify risk capacity information -- Some registrants assessed risk capacity by looking solely at a client's personal and financial circumstances without obtaining any client input specifically on their risk capacity. Others relied solely on a client's self-assessment without verifying and assessing financial circumstances and other relevant KYC information to ensure the client's self-selected risk capacity was appropriate.
• Risk tolerance and risk capacity factors not considered separately -- Some KYC forms combined these factors without distinguishing them clearly, leading to inaccurate risk profiles. Others provided limited response options that did not allow for different combinations of answers to be selected, such as "I am prepared to assume a high level of investment risk and volatile fluctuations in the value of my investment and am able to withstand losses", without including other options to indicate any variations on that statement (e.g., that they have a low ability to withstand loss with a high risk tolerance).
• Inadequate information gathered about risk tolerance and risk capacity to support determination of risk profile -- Some registrants used KYC forms with "low", "medium" and "high" checkboxes for risk tolerance and risk capacity without explaining these terms or documenting how the risk profile was determined.
• No or inadequate process to determine an overall risk profile -- Some registrants collected both risk capacity and risk tolerance information but had no process or had an inadequate process to arrive at an overall risk profile.
• Inconsistent risk profile determination process -- While some firms had well-designed optional investor profile questionnaires (IPQs) that collected risk tolerance and risk capacity information and assisted registered individuals in determining their clients' risk profiles, they lacked clear policies and procedures for registered individuals to follow when the standard IPQ was not used.
• Unresolved discrepancies between risk profile and other KYC information -- Some registrants failed to address discrepancies between the client's risk profile and other KYC information such as financial circumstances, investment objectives, time horizon or age and did not have documentation explaining the discrepancies and how they were addressed.
• No confirmation of risk profile by client -- Some registrants had an adequate process to determine the client's risk profile, but did not maintain documentation to support that the client had confirmed the accuracy of the KYC information collected, including the risk profile.
(b) Guidance
Registrants should collect and assess both risk tolerance and risk capacity to establish a client's risk profile. Risk tolerance and risk capacity are separate considerations and should be assessed separately, and a client's overall risk profile should reflect the lower of the two. If a registrant determines otherwise, the rationale should be clearly documented.
Clients should provide specific input on both their risk tolerance and risk capacity. Registrants should ensure that the information collected for both elements is detailed enough for a meaningful assessment. Registrants should have a consistent process, outlined in the firm's policies and procedures, with clear criteria for determining a client's overall risk profile. The process should be sufficiently detailed to ensure consistency in risk profile determinations and enable effective supervisory oversight.
Registrants should also reconcile any conflicting information between a client's stated risk tolerance and risk capacity and other KYC information, inclusive of KYC information captured on client risk profilers or IPQs. Specifically, registrants should assess risk capacity in relation to other KYC information such as personal circumstances (including age and family situation), financial circumstances (including liquidity needs), investment objectives and investment time horizon, and any other relevant information from the client. Any inconsistencies should be discussed with the client, and the resolution should be documented.
Questionnaires can be a valuable tool for collecting and assessing the relevant information to determine clients' risk profiles. If used, firms should design questionnaires to include separate questions for risk tolerance and risk capacity to ensure each are assessed independently. Additionally, registrants should appropriately weight these factors to arrive at a meaningful risk profile, and avoid, for example, scenarios where a client with a low risk capacity and high risk tolerance is determined to have a high risk profile, or where a client with a high risk capacity and low risk tolerance is determined to have a high risk profile.
The risk tolerance and risk capacity information collected and the overall risk profile determined should be documented. Risk profile is part of a client's KYC information and, as with other KYC information collected, registrants must take reasonable steps to have the client confirm the accuracy of the information.
2. Collection of financial circumstances information (Subparagraph 13.2(2)(c)(ii) of NI 31-103, IDPC Rule 3202(1)(iii)(a)(II), MFD Rule 2.2.1(1)(b)(ii))
The guidance in the CFRs clarifies the financial information that registrants should consider to support suitability determinations, including annual income, liquidity needs, financial assets, net worth and whether the client is using leverage or borrowing to finance the purchase of securities. Registrants should take reasonable steps to collect and document sufficient details on each of these factors to properly assess clients' financial circumstances and support their suitability determinations.
(a) Issues identified
Issues relating to the collection of financial circumstances information noted in our reviews included:
• Liquidity needs not collected -- Some registrants did not collect information about a client's liquidity needs, despite its importance in assessing whether a portion of client assets might be required to pay for near term expenses. This was especially concerning when clients were invested in securities that were illiquid or lacked redemption features.
• No or inadequate collection of net financial assets, net worth and annual income -- Some registrants did not collect sufficient net financial assets, net worth, or annual income information, or did so in a way that lacked meaningful detail to make a suitability assessment in the cases reviewed. For example, some registrants collected this financial information in overly broad ranges, which made it challenging for those registrants to perform an accurate and meaningful concentration assessment when determining suitability. To illustrate: if the registrant collected net financial assets for a client as falling within the range of $1 million to $5 million, a $400,000 investment in a security could represent anywhere from 8% to 40% of the client's net financial assets.
• Registrant did not obtain a breakdown of financial assets -- Some registrants did not obtain an adequate breakdown of clients' financial assets to enable them to discharge their suitability determination obligations in the circumstances. For example, in some cases where registrants offered illiquid securities or sector specific investments, the registrants did not obtain a detailed breakdown of a client's financial assets, including cash instruments and securities invested in (such as mutual funds, listed securities and exempt securities) and assets held outside of the registrant. In these cases, the registrants were not able to adequately assess certain relevant types of concentration for clients, such as exposure to the exempt market or a particular sector.
• No or inadequate collection of individual KYC information -- Some registrants failed to gather sufficient KYC information for each client when multiple family members had joint and individual accounts. For example, some firms collected risk tolerance, annual income and investment time horizon on only a combined basis for spouses and thus did not have adequate KYC information to support their suitability determinations on individual accounts held by each spouse.
(b) Guidance
To support sound suitability assessments, it is important for registrants to gather sufficiently detailed information about each client's financial circumstances given the context. This includes understanding annual income, liquidity needs (such as ongoing and short-term expenses or financial obligations), financial assets, net worth and any use of leverage or borrowing to invest. Where information given by the client appears to be unclear or inaccurate, the registrant should make further inquiries or obtain corroborating details.
A breakdown of financial assets can provide a clearer understanding of clients' financial circumstances. In certain cases, such as when a firm offers illiquid products or sector-specific investments, the firm should assess whether it may also be necessary to understand investments held outside the firm to perform an adequate suitability determination.
3. Keeping KYC information current (Subsections 13.2(4) and 13.2(4.1) of NI 31-103, IDPC Rule 3209(3) and (4), MFD Rule 2.2.4(b) and (f))
Registrants must take reasonable steps to keep KYC information current, including updating the information within a reasonable time after the registrant becomes aware of a significant change in a client's information. In addition, the CFRs set minimum KYC review and update timelines:
• for managed accounts, no less frequently than once every 12 months;
• if the registrant is an exempt market dealer (EMD), within 12 months before making a trade for, or recommending a trade to, the client; and
• in any other case, no less frequently than once every 36 months.
Given that more than 36 months have elapsed since the effective date of these CFR provisions, KYC information maintained by all firms for their clients should now include all KYC information required under the CFRs.
(a) Issues identified
Issues relating to keeping KYC information current noted in our reviews included:
• KYC information not reviewed and updated at required minimum frequency -- A number of firms had client files that did not have sufficiently up-to-date KYC information to comply with the required minimum update timelines.
• KYC information not updated after significant change -- In some cases, firms were aware of a significant change in a client's KYC information (e.g., loss of job, retirement, divorce), but did not collect updated KYC information after learning of the significant change, even though it could impact, for example, the client's net worth, financial assets, annual income, liquidity needs, investment time horizon, risk profile or investment needs and objectives.
• Inadequate documentation of periodic KYC reviews and updates -- Some registrants stated that they had met with clients within the time that periodic updates were required to confirm that KYC information had not changed, but did not have sufficient, or any, documentation to evidence that these meetings had occurred or what KYC information had been discussed.
• No client confirmation of changes -- Some registrants did not take reasonable steps to have clients confirm the accuracy of changes and updates to KYC information, including in situations where significant changes were made to the information.
(b) Guidance
Registrants must take reasonable steps to keep their client KYC information current, including updating records promptly after learning of significant changes to enable them to make suitability determinations. Registrants must review and update KYC information at the required frequencies, or sooner if they learn that a client's circumstances have significantly changed. Periodic KYC updates should evidence that the registrant turned their mind to reviewing all of the elements of a client's KYC information after a meaningful interaction with the client.
Significant changes in a client's circumstances include those that could impact a client's risk profile, investment time horizon, investment needs and objectives, or financial circumstances. These and other significant changes may require the registrant to revisit its suitability determination for the client.
Registrants should be proactive in keeping KYC information up to date and periodically confirm with clients that the information they have on file remains current.
Registrants should document KYC updates with records that are dated and sufficiently support that a meaningful interaction took place. While professional judgement can be used to determine the level of detail in the documentation, retaining supporting evidence is important, even if the result of the interaction was that no changes needed to be made to the KYC information. A note stating only "no update" or "no changes" in the client file or on the KYC form is insufficient without other evidence that a meaningful interaction took place with the client, to avoid solely performing a perfunctory review.
Registrants must take reasonable steps, within a reasonable time, to confirm with their clients the accuracy of KYC information, including updates. Confirmation can be documented through various means like signatures, email confirmations, or detailed notes. Changes to significant KYC and account information, such as name, address, or banking details (or other information that poses a heightened risk for account security), should be formally documented, with the client's written verification of the changes (e.g., a handwritten, electronic or digital signature) or other appropriate verification maintained.
If clients are unresponsive to KYC update requests, registrants should document their reasonable efforts to contact them, in order to meet the registrant's compliance obligations. Where clients are unresponsive to KYC update requests for prolonged periods of time, registrants should consider account restrictions, such as limiting new trades outside of redemptions, until the KYC information is updated.
B. KNOW YOUR PRODUCT (KYP) (Section 13.2.1 of NI 31-103, IDPC Rule 3300, MFD Rule 2.2.5)
Registered firms must take reasonable steps to assess, approve and monitor the securities that they offer (for CIRO firms, this is the Product Due Diligence aspect of KYP), while registered individuals must take reasonable steps to understand the securities they transact in, or recommend to clients, in sufficient detail to allow them to meet their obligations in respect of conducting suitability determinations.
Our reviews found that firms have taken a range of different approaches to fulfilling their KYP obligations, such as carrying out all assessment, approval and monitoring obligations at the firm level through various committees, or delegating certain assessment, approval and monitoring obligations to registered individuals.
However, we also noted that:
• many firms lacked sufficient documentation to evidence the KYP assessments performed, including documenting the relevant aspects of the securities that were considered;
• in some cases, documentation evidencing that registered individuals took steps to discharge their own KYP obligations was lacking;
• some firms failed to document their approval of the securities;
• some firms had inadequate processes for monitoring securities for significant changes; and
• some firms had inadequate processes for performing KYP on securities transferred into the firm or acquired as a result of client directed trades.
1. KYP -- Firm assessments (Paragraph 13.2.1(1)(a) of NI 31-103, IDPC Rule 3301(1)(i), MFD Rule 2.2.5(1)(a))
Registered firms must take reasonable steps to assess the key aspects of securities offered to clients, including their structure, features, risks, initial and ongoing costs and the impact of those costs.
(a) Issues identified
Issues relating to KYP assessments by firms and the documentation of those assessments noted in our reviews included:
• Lack of evidence of a review of KYP documents -- As part of their due diligence, some firms collected and maintained key documents relating to an issuer (e.g., financial statements, website screenshots, analyst reports, Bloomberg screenshots) obtained from issuers or third parties but failed to document how this information was reviewed, who conducted the review and when it was conducted. While third-party reports can support KYP assessments, firms need to document their own analysis.
• No KYP assessment documented for related or connected issuers -- Some firms did not assess securities of related or connected issuers or maintained only limited documentation. In some cases, firms incorrectly assumed that their involvement at the issuer level was sufficient to demonstrate that they had met the KYP assessment requirement.
• No KYP assessment documented for model portfolios -- Some firms using model portfolios failed to assess and document their assessment of the model portfolios (e.g., investment objectives and strategies, composition, features, costs, risks and who they would be suitable for) before offering them to clients.
• Inappropriate reliance on KYP assessments done by an affiliate -- For some large firms that work closely with registered affiliates, Staff observed instances where the firm relied solely on the affiliate's KYP to discharge their own KYP assessment obligations.
(b) Guidance
Firms must ensure that all securities offered to clients, including those in model portfolios and those of related or connected issuers, are subject to an appropriate KYP assessment by the firm. The KYP assessment requirement is not limited to manufactured products such as investment funds. Model portfolios made available to clients are expected to be subject to an appropriate KYP assessment at the model portfolio level.
Securities of related and connected issuers should be subject to the same or similar KYP process as those of unrelated issuers (in addition to the firm discharging its obligations related to the distribution of related securities under the conflicts of interest requirements). While it is not expected that firms duplicate documentation that they created when acting as the manager of an issuer, firms are required to perform a KYP assessment of the securities of related or connected issuers, particularly when the firm's client-facing registered individuals are not the same individuals who are involved in managing the issuer.
A firm's KYP assessment process should align with its business model and the types of securities offered to clients. The depth of review required under the firm's KYP assessment process may vary based on a security's structure, complexity, risk level and transparency. A more streamlined review may be appropriate for less complex and lower risk securities, while a more in-depth review may be warranted for securities that are more complex or riskier, such as those that are novel, not transparent in structure, involve leverage, options or other derivatives, have limited liquidity or have limited disclosure available.
A firm's KYP assessment process may involve a division of responsibilities between the firm (including a committee acting on behalf of the firm) and its registered individuals. The firm's policies and procedures should clearly outline roles, steps, and controls and ensure consistent application of the KYP assessment process for similar securities.
It may be reasonable for a firm to group KYP assessments for similar, non-complex securities (for example, non-complex prospectus-qualified mutual funds from the same manufacturer), provided that the process is well-defined and ensures that the firm meets its KYP obligations to assess the relevant aspects of the grouped securities and the firm's registered individuals have the information needed to comply with their KYP obligations.
Firms should keep relevant documentation to support their KYP assessments (e.g., such as issuer financial statements, prospectuses, offering memoranda, fund facts, annual and semi-annual reports, internal product due diligence reports, performance reports, filings and disclosures, etc.), and keep records showing the analysis conducted for all securities made available to clients. These records are required to support the decision to make a security available to clients and demonstrate that a reasonable review was conducted prior to approving the securities.
(c) Examples of firm practices
We saw a variety of acceptable KYP assessment and documentation practices in our reviews. Some firms tailored their assessment processes to their specific business models and types of securities offered as follows:
• Some large, integrated firms with many securities on their shelves established detailed processes setting out the type of KYP assessment required for different asset classes, as well as the committees and individuals responsible for the assessment. This helped ensure efficient implementation of the firm level KYP assessment.
• Some firms designated a committee to conduct firm level KYP assessments of certain types or groups of securities (e.g., all prospectus-qualified mutual funds from a specific manufacturer), and require registered individuals to conduct further product specific reviews to ensure all relevant aspects of the securities are assessed as required, and to support their own KYP responsibilities and suitability determinations.
• Certain firms that focus primarily on proprietary products managed certain risks associated with that business model in their KYP assessment process, in particular, conflicts of interest, by incorporating market comparisons with third-party products into their process.
• Certain portfolio manager (PM) firms that permit their advising representatives to choose from a wide universe of securities rather than from a shelf or product list put in place a process to reflect that the individual advising representatives are responsible for carrying out the KYP assessment of those securities, and the approval of the securities, on behalf of the firm.
• Several PM firms developed tailored KYP assessment processes supported by technical or algorithmic evaluations, documenting how selected securities align with investment criteria.
• Certain mutual fund dealers and investment dealers established different processes for KYP assessments based on whether a proposed fund is managed by a PM or an investment fund manager approved by the firm, and considering additional factors such as the risk level of the fund (e.g., prospectus qualified mutual fund vs. prospectus exempt alternative fund) and requiring additional review in the case of more costly funds.
Examples of acceptable KYP assessment documentation practices included:
• maintaining due diligence memos or summaries for all securities made available to clients (including those of related and connected issuers);
• completing tailored KYP forms outlining the elements of the security reviewed;
• leveraging technology that aggregates and updates key product information, particularly for publicly available products like prospectus-qualified mutual funds and exchange traded funds (ETFs), and integrating it into systems used by registered individuals;
• discussing key aspects and features of securities at investment committee meetings and maintaining detailed minutes or recordings;
• establishing a process where registered individuals research and document potential securities for investment, then present to the investment committee for consideration and approval;
• for larger firms, assigning research teams to prepare detailed reports on securities based on the nature and complexity of the security for use at investment committee meetings and by registered individuals.
2. KYP -- Registered Individuals (Subsection 13.2.1(2) of NI 31-103, IDPC Rule 3302(1), MFD Rule 2.2.5(2))
Registered individuals must take reasonable steps to understand all securities, and are expected to understand all model portfolios, purchased or sold for, or recommended to, clients.
(a) Issues identified
Issues relating to registered individuals' KYP obligations noted in our reviews included:
• Inadequate documentation to evidence that registered individuals discharged their KYP obligations -- In some cases, firms conducted a centralized KYP assessment on securities that were approved to be made available to clients. However, there was no evidence to demonstrate that after that, the registered individuals that recommended or selected these securities from the approved list had taken sufficient steps (or been provided enough information/training by the firm) to discharge their own KYP obligations.
• No KYP assessment documented for model portfolios -- Some registered individuals recommended model portfolios without showing they had taken reasonable steps to understand the model portfolios before recommending them to clients.
(b) Guidance
Reasonable steps must be taken by registered individuals to understand securities they recommend to or trade for clients, including their structure, features, risks, costs, and how those costs affect performance. More complex or higher risk securities may require a more detailed consideration.
Where clients invest in model portfolios offered by a firm, the KYP obligation for the firm's client-facing registered individuals is to understand how the model portfolios are composed, their features and risks, and the types of clients for whom they may be suitable. Registered individuals responsible for selecting securities to be included within the model portfolios must take steps to understand each of the underlying securities within the models.
To assist registered individuals in complying with their own KYP obligations, firms should provide access to the information gathered through the firm's KYP process, as well as providing any necessary training and tools to assist them.
An appropriate level of documentation must be maintained to demonstrate that registered individuals have taken reasonable steps to understand the securities and model portfolios they purchase or sell for, or recommend to, clients.
(c) Examples of firm practices
We noted that firms used various methods to assist registered individuals in meeting their requirements to understand the securities they purchase or sell for, or recommend to, clients including:
• providing technology to generate and record key information about securities, and requiring registered individuals to acknowledge reviewing the required information before making recommendations (this method was used more frequently for publicly available manufactured products such as prospectus qualified mutual funds and ETFs);
• requiring registered individuals to review due diligence memos or summaries for each security approved by the firm and to pass an examination set by the firm based on the content prior to recommending the security to clients, including re-examination when a significant change impacts the security (we noted this method was used by some EMDs);
• ensuring registered individuals have access to relevant information about the securities to assist them in undertaking and evidencing their own review by, for example:
• distributing research reports on securities made available to clients prepared by a research team or centralized group, which are appropriately detailed given the nature and complexity of the security;
• for some smaller firms, distributing the firm's completed KYP assessments for securities by email, which summarize all relevant aspects of a security.
3. Approval of securities (Paragraph 13.2.1(1)(b) and subsection 13.2.1(3) of NI 31-103, IDPC Rule 3301(1)(ii) and (2), MFD Rule 2.2.5(1)(b) and (3))
Firms must ensure that all securities that they make available to clients are approved, and registered individuals must not purchase or sell a security for, or recommend a security to, a client unless the security has been approved by the firm.
(a) Issues identified
Issues relating to the approval of securities and the documentation of the approval noted in our reviews included:
• No evidence of approval -- Some firms couldnot provide documentation evidencing approval of securities made available to clients despite representing to Staff that the securities had been approved. For example, some firms:
• represented that their investment or other committees discussed and approved securities, but failed to maintain evidence of the discussion and the approval;
• represented that the securities were added to an "approved list" without documenting the approval process, assessments or rationale for inclusion;
• offered model portfolios managed by the firm or an affiliate and did not maintain evidence that the portfolios were approved to be made available to clients.
• Insufficient evidence of approval -- In some cases, firms documented that certain securities were approved without documentinga reasonable KYP assessment or rationale.
(b) Guidance
Firms must establish approval processes for securities made available to clients and are also expected to have a process to approve model portfolios that are made available to clients. Processes and approval criteria may vary based on the firm's business model and the complexity and risks of the securities offered. Policies and procedures should clearly define the approval process, and approvals should be appropriately supported and documented.
We noted that firms took various approaches to assigning approval responsibility, depending on their size, their business model and the complexity and risks of the securities offered, including designating committees (such as investment committees and product review committees) or individuals (such as the firm's Chief Investment Officer, Chief Compliance Officer, Ultimate Designated Person, senior advising representatives or certain individual advising representatives).
Some PM firms using algorithmic models developed processes based on model outputs. In such cases, firms should document details of the model used, the resulting outputs and evidence of ongoing oversight to ensure it is functioning appropriately.
Approval documentation should show meaningful consideration by the individual or group approving the security (or, where appropriate, approving the group of securities), including key elements that were assessed and support for why the approval was appropriate. Simply stating that securities are "approved" or placing them on an "approved list" without evidence of a reasonable review process or criteria supporting that decision is insufficient to show that a meaningful consideration took place.
(c) Examples of firm practices
Acceptable firm practices regarding approvals of securities and the documentation of the approvals observed in our reviews included:
• recording sign-off or approval on the documentation that evidenced the assessment of the key elements of the security (e.g., directly on a due diligence memo, research report or KYP memo prepared for the security);
• maintaining detailed committee meeting minutes documenting discussions of the key elements of a security and committee approval;
• maintaining email records outlining the required information and approval confirmations;
• in the case of complex or high risk products, review and approval at many larger firms is completed and documented by a Product Review Committee;
• in cases where firms specialize in certain niche sectors (e.g., mining stocks), greater reliance is placed on the KYP assessments completed and documented by individuals with the necessary expertise such as engineers, and approval is often granted by a registered individual, such as a supervisor or the Chief Compliance Officer, based on a review of the KYP analysis prepared by the expert staff.
4. Monitoring for significant changes in securities (Paragraph 13.2.1(1)(c) of NI 31-103, IDPC Rule 3301(1)(iii), MFD Rule 2.2.5(1)(c))
Registered firms must take reasonable steps to monitor securities for significant changes. Monitoring should be applied to securities that are available for purchase through the firm, and, where a firm has an ongoing relationship with clients and is required to complete periodic suitability reassessments, to all securities that are held in clients' accounts, even if those securities are no longer available for purchase through the firm.
(a) Issues identified
Issues relating to monitoring for significant changes in securities noted in our reviews included:
• No definition of "significant change" in a security -- Many firms did not have an adequate monitoring process in place as they did not define what constitutes a significant change in a security and when it would trigger a reassessment of the security's approval or suitability for clients holding the security. As a result, despite the firms having monitoring processes in place, there was no process to determine what action the firms may need to take when the monitoring indicated a change to a security.
• Inadequate monitoring frequency -- Some firms monitored securities at a frequency that was inadequate for the type of security, including its risks and complexity. For example, we noted that certain EMDs offering risky, illiquid, and complex products monitored for significant changes only on an annual basis, which Staff found to be inadequate.
• Inappropriate reliance on issuers / product manufacturers for notification of changes -- Some firms passively relied on issuers or product manufacturers to notify them of changes or required issuers or product manufacturers to confirm annually whether there had been any significant changes. These firms did not have their own proactive monitoring processes.
• No process to monitor or no evidence of monitoring -- Some firms lacked a monitoring process altogether or failed to maintain evidence that securities or model portfolios were reviewed for significant changes that could affect client suitability. Some firms maintained up-to-date information on securities (e.g., updated issuer financials) but had no evidence it was reviewed or considered as part of their monitoring process.
(b) Guidance
Firms should define what constitutes a significant change for the types of securities they offer and implement a monitoring process that outlines how and at what frequency monitoring will occur. The definition of significant change and the monitoring frequency should reflect the nature of the securities, the firm's business model, and investment strategy.
Examples of significant changes identified by firms include a change in:
• the risk rating of a security;
• the costs/fees associated with a security;
• the liquidity of a security;
• distribution and redemption privileges (e.g., redemptions suspended);
• the operations of an issuer;
• management or significant ownership of an issuer;
• the issuer's credit rating;
• financial ratios;
• the geopolitical situation; and
• macroeconomic factors.
The greater the security's risk or likelihood of significant changes, the more frequently and closely it should be monitored. In general, annual monitoring alone was not found to be sufficient. Firms should have written policies and procedures outlining their monitoring process and maintain evidence that the process was followed (e.g., records of information obtained and reviewed).
Where significant changes are identified, firms should document their assessment of those changes and consider appropriate responses where necessary, which may include:
• notifying registered individuals of the change,
• reassessing suitability for clients and taking corrective actions in client accounts as necessary,
• revisiting the firm's approval of the security,
• implementing additional controls around the sale of the security (e.g., restricting new sales to certain types of investors).
Where corrective actions are limited due to the nature of the security (e.g., illiquid securities or redemption restrictions), appropriate responses may involve halting new sales and informing affected clients of the change.
(c) Examples of firm practices
Some examples of firms' KYP monitoring processes included:
• periodically updating due diligence memos or key elements of KYP assessments to identify significant changes, informing all registered individuals of any significant changes, and retaining all document versions to evidence the process.
• using portfolio management software to create a tailored "watch list" or "approved list" that delivers daily updates on key metrics and news about issuers, enabling registered individuals to monitor for significant changes.
• implementing automated systems that track and flag significant changes to securities on a daily, weekly, or monthly basis, with updates provided to registered individuals for follow up where appropriate.
5. KYP -- Transfers in and client directed trades (Paragraphs 13.2.1(1)(a) and (c) of NI 31-103, IDPC Rule 3301(1)(i) and (iii), IDPC Rule 3302, MFD Rule 2.2.5(1)(a) and (c))
KYP assessment and monitoring requirements apply to securities transferred into a firm or acquired through a client directed trade, though firms are not required to approve these securities if they are not otherwise made available to clients. Firms must assess these securities within a reasonable time after the transfer or trade and include them in their monitoring process for significant changes.
Registered individuals must take steps to understand all securities held in a client's account to meet their suitability determination obligations. This includes understanding securities transferred into the firm or acquired through client directed trades within a reasonable time.
(a) Issues identified
We noted the following issues relating to KYP assessments for transferred securities or client directed trades:
• No KYP assessment performed on transferred in securities and client directed trades -- Many firms and registered individuals failed to perform or document KYP assessments on securities transferred in or resulting from client directed trades within a reasonable time.
• Inappropriate exclusion of securities from KYP processes -- Some firms excluded securities transferred in or from client directed trades from their KYP processes, citing the trade size being too small (e.g., below a defined threshold established by the firm) or trades being infrequent.
(b) Guidance
Registrants must assess securities transferred into the firm or resulting from client directed trades within a reasonable time. However, the depth of the KYP assessment may vary based on factors such as the nature of the securities, how long they will be held in the client account, the client's circumstances and investment objectives, and the relationship between the client and the firm. Firms must not exclude these securities from their KYP assessment and monitoring processes.
The KYP assessment performed and the steps taken by the registered individual to understand the securities should be adequate to support suitability determinations, including decisions about whether to continue to hold or divest the securities in a client's account, and should be documented.
C. SUITABILITY DETERMINATION (Section 13.3 of NI 31-103, IDPC Rule 3400, MFD Rule 2.2.6)
The suitability determination provisions require that, prior to taking any investment action, registrants must assess and determine whether the action is suitable for the client, considering specific factors, such as the client's KYC information and the registrant's KYP assessment. Registrants must also determine that the action puts the client's interest first.
These provisions also establish requirements for periodic reviews of the suitability of client accounts (at a minimum, when the periodic KYC reviews occur as required under subsection 13.2(4.1) of NI 31-103 (IDPC Rule 3209(4), MFD Rule 2.2.4(f)), and set out the process for handling client directed trades and unsolicited orders.
Our reviews found that many firms had not updated their suitability determination processes to ensure they are complying with their enhanced obligations under the CFRs. In addition, we noted the following issues related to suitability determinations:
• inadequate consideration of certain specific factors when making a suitability determination;
• inadequate policies and procedures, as they lacked sufficient detail on the responsibility and timing for documenting factors considered in suitability assessments; and
• inadequate documentation of suitability determinations.
Similar issues were noted with periodic suitability reassessments and related documentation, as well as with suitability determinations for client directed trades and unsolicited orders.
1. Suitability determinations and factors to be considered (Subsection 13.3(1) of NI 31-103, IDPC Rule 3402(1), MFD Rule 2.2.6(1))
Before taking an investment action, registrants must assess and determine its suitability for the client, considering the factors in paragraph 13.3(1)(a) of NI 31-103 (IDPC Rule 3402(1)(i), MFD Rule 2.2.6(1)(a)):
• the client's KYC information;
• the registrant's KYP assessment or understanding of the security;
• the impact of the investment action on the client's account, including concentration and liquidity;
• the potential and actual impact of costs on the client's return on investment; and
• a reasonable range of alternative actions available to the registrant through the registered firm.
Registrants must also satisfy paragraph 13.3(1)(b) of NI 31-103 (IDPC Rule 3402(1)(ii), MFD Rule 2.2.6(1)(b)), by determining that the investment action puts the client's interest first.
While not all factors may be equally relevant in every case, registrants should use their professional judgement and take reasonable steps to consider each factor's relevance to the specific investment action being considered, and must always prioritize the client's interest over their own or other competing considerations, such as a higher level of remuneration or other incentives, when choosing among suitable options.
(a) Issues identified
Issues relating to suitability determinations included:
• Incomplete consideration of factors included in paragraph 13.3(1)(a) of NI 31-103 (IDPC Rule 3402(1)(i), MFD Rule 2.2.6(1)(a)) -- Some registrants lacked processes to ensure that all factors were considered prior to taking an investment action. While KYC and KYP factors were generally addressed, firms often failed to require registered individuals to consider:
• the impact of the investment action on a client's account, including concentration and liquidity of the securities within the account,
• the impact of costs on the client's returns, and
• a reasonable range of alternative investment actions.
• No process in place to consider impact of an investment action across all of the client's accounts -- Some registrants did not have a process in place to consider whether a recommendation or decision for a client account would materially affect the concentration and liquidity of the client's investments across all of the client's accounts held at the firm, as applicable. Such a process is one of the ways a registrant can seek to determine whether an investment action puts the client's interest first as required by paragraph 13.3(1)(b) of NI 31-103 (IDPC Rule 3402(1)(ii), MFD Rule 2.2.6(1)(b)).
• Inadequate suitability determination process for model portfolios -- Some firms did not recognize that suitability determinations (including the consideration of a reasonable range of alternatives) are expected to be performed at different levels for model portfolios made available to clients:
• at the model level (when constructing and managing the model portfolios) -- suitability determinations are expected to be performed for securities selected for inclusion in the models or for other investment actions taken for the models, and
• at the client-facing level -- a suitability determination is expected to be performed when a particular model portfolio is selected for a client from other model portfolios available at the firm.
Some firms also did not recognize that where registered individuals are permitted to substitute securities within a particular model portfolio or otherwise deviate from the model at the client-facing level, a suitability determination is expected to be performed on the substituted securities or in respect of the deviation from the model.
• Insufficient documentation processes -- Some firms lacked adequate processes to identify and maintain appropriate documentation to support suitability determinations. For example, some firms:
• had no processes for the documentation of suitability determinations,
• had processes to maintain only limited documentation that did not evidence a reasonable basis for the suitability determinations made, or
• relied on superficial tools (e.g., checklists) without supporting documentation of how factors were considered and decisions made.
• No or inadequate documentation to support suitability determinations -- Some firms had little or no documentation or recorded only that an investment was "suitable" without showing the basis for that determination. While the level of detail may vary, documentation must always be sufficient to demonstrate a reasonable basis for the suitability determination. Centralized or periodic analysis may be relied on without repeating documentation for each recommendation, but where suitability is less clear, more detailed records are necessary.
(b) Guidance
Staff recognize that depending on the firm's business model, the available securities, the characteristics of the firm's client base and the nature of the clients' relationship with the firm, as well as the investment action being considered, some factors in paragraph 13.3(1)(a) of NI 31-103 (IDPC Rule 3402(1)(i), MFD Rule 2.2.6(1)(a)) may be more relevant than others. Registrants should have processes in place to reasonably consider all suitability factors when making a suitability determination.
Overall documentation, achieved through relevant firm and individual processes, should be detailed enough to demonstrate meaningful suitability determinations. It should illustrate the reasonable basis for registrants' determinations that investment actions taken are suitable for clients and put clients' interests first, reflecting the understanding of the product, the risk, complexity, and uniqueness of recommendations, and enable robust supervisory review. Firms have flexibility to tailor their processes, using a mix of individual and centralized processes based on their business model. Some examples of acceptable centralized processes used at firms are provided in the "Examples of firm practices" section below.
Where an investment action for a client appears inconsistent with one or more factors, but there are competing considerations that make the investment action ultimately suitable for the client, more detailed documentation should be maintained to support the suitability determination and demonstrate that the client's interests were put first.
Where firms offer model portfolios, we expect that the suitability determinations are performed at different levels: (i) at the model level (when constructing and managing the model portfolios), when suitability determinations are expected to be performed for securities selected for inclusion in the models or for other investment actions taken for the models, and (ii) at the client-facing level, when a suitability determination is expected to be performed when a particular model portfolio is selected for a client from other model portfolios available at the firm. If a registered individual substitutes securities within a particular model portfolio or if the registered individual otherwise deviates from the model at the client-facing level, a suitability determination is expected to be performed on the substituted securities or in respect of the deviation from the model.
We noted in our reviews that PM firms that maintained well-defined and comprehensive investment policy statements for clients that considered all accounts of the client, in conjunction with the use of effective automated pre-trade and post-trade compliance tools, were generally better positioned to demonstrate compliance with the suitability determination requirements. While the investment policy statements and trade controls alone were not sufficient to demonstrate that all factors had been considered by the registrant, these were supplemented by additional processes (for example, to consider a reasonable range of alternatives) to ensure that the suitability determination obligation was met.
(c) Examples of firm practices
We noted that some firms appropriately tailored their suitability determination and documentation processes for their business models and circumstances. Noted below are some examples of practices observed in our reviews where processes were appropriately tailored and registrants met their suitability determination and documentation obligations.
These practices were observed for PMs or investment dealers making identical decisions or recommendations for all client accounts following a particular mandate or strategy, or seeking a specific type of investment exposure. Depending on the firm's business model, the complexity of securities and controls the firm had in place, Staff accepted certain practices based on the facts and circumstances presented during the reviews.
• Mandate-level suitability determinations -- For firms making identical investment decisions for clients following a particular investment mandate (e.g., all clients having exposure to Canadian large cap equities in varying degrees), such as a decision to include a new security in the portfolios of all such clients, the firm completed and documented its suitability determination for the addition of the security at the mandate level and identified all of the client portfolios to which it applied. The firm had robust controls in place at the client level (e.g., to identify any concentration issues or investment restrictions) to ensure that the suitability determination was appropriate for all clients within that mandate. In addition, the firm had in place a robust periodic suitability reassessment process that was completed and documented for all clients, where the suitability of all securities in a client's account / portfolio was comprehensively assessed.
This approach relieved the firm and its registered individuals from the duplicative work of completing separate suitability determination documentation for all client accounts following the same mandate at the time of each investment action. The firm-level documentation maintained supported the investment action for individual securities held by the identified group of client accounts.
• Adjustments to existing securities -- Where exposure to a security already held in a client account was changed, registrants documented their suitability determinations at a higher level where it was reasonable to rely on the prior suitability determination, provided the rationale was recently assessed or updated to confirm that no material changes had occurred.
• Account rebalancing -- Staff noted that in cases where client accounts are periodically rebalanced to return to a target weighting with no changes to the specific securities in the accounts, it was appropriate for registrants to document their suitability determinations for the trades in a summary manner.
Registrants using tailored suitability determination and documentation processes similar to those above must maintain detailed policies and procedures to demonstrate how suitability determination requirements are met and to ensure periodic suitability reassessments are completed as required so that portfolio holdings continue to be suitable for clients and put their interests first.
2. Impact on client's account or portfolio (Subparagraph 13.3(1)(a)(iii) and paragraph 13.3(1)(b) of NI 31-103, IDPC Rule 3402(1)(i)(c) and (ii), IDPC Rule 3402(4), MFD Rule 2.2.6(1)(a)(iii) and (b))
Registrants must assess how an investment action affects concentration and liquidity within a client's account and, where clients hold multiple accounts, across the portfolio of all accounts held with the firm.
To meet these obligations, firms should set appropriate concentration and liquidity thresholds based on client circumstances and the types of securities held, and establish processes to monitor and manage them.
(a) Issues identified
Issues noted in our reviews of registrants' consideration of the impact that a proposed investment action would have on a client's account or overall portfolio held at the firm included:
• Lack of concentration and liquidity controls -- Some firms failed to establish or apply thresholds or limits for investment concentration (such as with respect to the types of investments, issuers, sectors and asset classes) or liquidity and as a consequence they were unable to adequately assess the impact of investment actions on client accounts and portfolios.
This included EMDs selling highly concentrated or illiquid investments without proper thresholds in place to assess the overall exposure that clients have to such investments (whether through investments held within or outside of the firm), and investment dealers lacking processes to identify, monitor, and control holdings in illiquid securities.
• Inadequate assessment and documentation of concentration and liquidity across multiple client accounts --Some firms did not assess concentration and liquidity across a client's multiple accounts or lacked documentation to support asset allocation decisions made to strategically contain certain categories of securities in specific types of accounts (e.g., for tax planning purposes).
• Incomplete KYC information -- Some EMDs did not collect sufficient information about clients' external investments, preventing a proper assessment of liquidity and concentration risks in specific sectors or asset classes, particularly in exempt market products.
(b) Guidance
Registrants should have appropriate controls to calculate, monitor, and manage concentration in client accounts and portfolios, tailored to their business model and the securities offered. The higher the concentration in a particular type of security, sector or industry in a client's account or across a client's portfolio, the more steps the registrant should take, and appropriately document, to demonstrate that the investment was suitable for the client and put the client's interest first.
If an investment holding exceeds internal concentration or liquidity thresholds but remains suitable for the client and puts the client's interest first, registrants must document the rationale in detail. Firms with narrow or higher risk offerings (e.g., EMDs, specialized investment dealers) should gather thorough client financial circumstances information, including on external holdings, and assess issuer-specific, sector, and overall exempt product exposures and concentration relative to a client's net financial assets and the internal thresholds set by the firm. Where clients withhold information, registrants should use their professional judgement to consider whether or not they have obtained sufficient KYC information on the client's financial circumstances to meet the registrant's suitability determination obligations, in respect of concentration and liquidity and otherwise.
Firms that maintain multiple accounts for clients should have processes to assess and monitor concentration and liquidity across the portfolio comprised by those accounts. We encourage you to review the guidance set out in Questions 71 -- 77 in the CFRs FAQs on this topic.
(c) Examples of firm practices
Examples of effective processes adopted by firms to consider the impact of investment actions, including with respect to concentration and liquidity, both within and across client accounts, where applicable, included:
• Applying meaningful concentration and liquidity thresholds -- Some firms set and monitor concentration and liquidity thresholds based on issuer, sector and asset class exposure relative to clients' net financial assets. For example, some EMDs have implemented processes to consider issuer and sector concentration, as well as total concentration in exempt market investments, in relation to clients' net financial assets, and assess those against firm thresholds when considering whether a distribution of a security would be suitable for a client and put the client's interest first. These firms document their analysis as part of their suitability determination documentation for each distribution. In addition, some EMDs have implemented variable concentration and liquidity thresholds that are applied more conservatively to certain types of investors such as investors with lower risk tolerance and seniors.
• Use of portfolio management systems --Some firms use portfolio management systems that consolidate holdings across client accounts, allowing registered individuals to effectively assess and monitor concentration and liquidity across multiple accounts held by the client at the firm.
3. Impact of costs (Subparagraph 13.3(1)(a)(iv) of NI 31-103, IDPC Rule 3402(1)(i)(d), MFD Rule 2.2.6(1)(a)(iv))
As part of assessing suitability and prioritizing the client's interest, registrants must, under subparagraph 13.3(1)(a)(iv) of NI 31-103 (IDPC Rule 3402(1)(i)(d), MFD Rule 2.2.6(1)(a)(iv)), consider the actual and potential impact of costs associated with an investment action on the client's return on investment.
(a) Issues identified
Issues relating to registrants' assessments of the potential and actual impact of costs included:
• No assessment of costs when multiple series are available to clients -- Some firms made multiple series of the same security available to clients (e.g., Class A, B, and F of the same investment fund) where the costs of those series varied, but the registered individuals did not assess the impact of costs when selecting a particular series for the client.
• No requirement to consider lower cost options -- Some firms lacked policies requiring registered individuals to consider lower-cost alternatives available through the firm as part of the assessment of a reasonable range of alternative actions under subparagraph 13.3(1)(a)(v) of NI 31-103 (IDPC Rule 3402(1)(i)(e), MFD Rule 2.2.6(1)(a)(v)). For example, registered individuals were not required to consider lower management expense ratio (MER) series of investment funds when making recommendations.
• No process to monitor eligibility for lower cost investments -- Some firms failed to identify or monitor client accounts that could qualify for lower-cost investments, such as reduced MER fund series, once asset thresholds were met.
(b) Guidance
Registrants should have processes in place to assess all direct and indirect costs, fees, commissions, and registrant compensation associated with an investment action and compare them against other available options, based on the firm's existing business model and securities made available to clients.
Given that costs can significantly affect client returns, registered individuals should consider the relative costs of investment options, including any compensation paid directly or indirectly to the firm or individual. They must put the client's interest first when choosing among suitable options and document the rationale if recommending higher-cost products.
The relevance of cost considerations may depend on specific circumstances. For example:
• When investing solely in exchange-listed securities with uniform trading commissions, costs at the security level may have minimal impact. Unless the security has additional embedded costs (e.g., management fees, trailers), this assessment should require minimal documentation which can be completed by the firm in a centralized manner.
• When there are multiple series of the same investment available to the client and the costs between those series are different, registrants must assess the impact of costs in choosing a particular series over another, and the assessment and conclusion must be documented as part of the suitability determination for the series selected.
Suitability documentation related to assessing costs may be maintained at the individual recommendation level or through centralized processes beginning with the initial KYP assessment and updated on an ongoing basis as required to support suitability reassessments.
(c) Examples of firm practices
• Some EMDs with limited product shelves assessed and documented costs during their KYP process. Staff accepted this as sufficient where no similar alternative products were available on the firm's shelf. However, where alternatives exist, registrants are expected to reassess costs during the suitability process, and not solely rely on the initial KYP assessment.
• Some firms used technology to compare costs across available securities and assess cost impact, supporting registered individuals in making their suitability determinations.
4. Reasonable range of alternative actions (Subparagraph 13.3(1)(a)(v) of NI 31-103, IDPC Rule 3402(1)(i)(e), MFD Rule 2.2.6(1)(a)(v))
When assessing a proposed investment action, registrants must, under subparagraph 13.3(1)(a)(v) of NI 31-103 (IDPC Rule 3402(1)(i)(e), MFD Rule 2.2.6(1)(a)(v)), consider a reasonable range of alternative actions available through their firm at the time. Registrants should have processes for determining the level of documentation required to demonstrate that a reasonable range of alternatives was considered as part of their suitability determinations.
(a) Issues identified
Issues relating to registrants' assessments of a reasonable range of alternative actions included:
• Lack of documented process -- Many firms did not have written policies and procedures that documented their process for assessing a reasonable range of alternatives when determining the suitability of an investment action for a client.
• No or inadequate documentation to demonstrate that a reasonable range of alternatives was considered -- In many cases, registrants could not show evidence that a reasonable range of alternatives was considered at the time of the investment decision. Where this assessment is conducted and documented through a centralized or periodic process, that is generally acceptable. However, some firms indicated that registered individuals performed the assessment, yet no documentation was maintained to demonstrate it, even in cases involving higher-cost or more complex products.
• No documentation at the individual representative level -- Some firms identified and assessed a reasonable range of alternatives for various products on their shelf at the firm level and created an "approved list" or "recommended list" of securities to assist their registered individuals, but no assessment of the alternatives included on the list appeared to have been made by registered individuals when making recommendations and no documentation was maintained.
(b) Guidance
Firms must have processes to ensure a reasonable range of alternatives is considered when making a suitability determination. Processes may vary based on business models, investment strategies and relationships with clients, but should clearly define:
• who is responsible for identifying and assessing alternatives and when comparisons take place (e.g., what is to be done at the firm level versus at the registered individual level, what is to be done on a periodic basis versus what is to be done at the time of each specific recommendation),
• the scope of products to be considered (e.g., defining the comparable alternatives and what constitutes a "reasonable" range), and
• what information should be included in the documentation.
Firms with broad product shelves (e.g., open architecture platforms) may design efficient processes to manage their offerings. These processes should be designed to ensure suitability requirements are met while giving registered individuals sufficient flexibility to evaluate alternatives and make personalized client recommendations. Documentation should reflect the complexity of the security.
Evaluating alternatives requires, among other things, assessing cost structures and returns, including management fees and transaction costs, to ensure alignment with clients' interests. As part of the consideration of a reasonable range of alternatives, registered individuals should consider lower cost alternatives available through the firm and document the basis for their determinations when choosing among suitable alternatives.
(c) Examples of firm practices
We noted that different business models operationalized this requirement in different effective ways. For example:
• Use of centralized committees
• In firms where investment decision-making was centralized, the reasonable range of alternatives was often assessed as part of the firm's KYP process and documented at the firm level. This was common among investment dealers and PMs using centralized research departments to develop and communicate favoured mandate-level strategies, with registered individuals expected to apply these strategies as appropriate for clients. When client-specific needs required substitutions, registered individuals conducted and documented additional alternative analysis.
• Some firms had a centralized group that periodically prepared an approved list of securities for client recommendations, requiring registered individuals to document how they selected a particular security from available alternatives on the list.
• Some firms leveraged their centralized KYP and monitoring processes to periodically identify a reasonable range of alternatives for use in suitability determinations.
• Use of technology or tools
• Some firms provided technology to help registered individuals identify and compare a range of alternatives, generating comparative analyses (including cost factors) that could be saved to document their recommendations.
• Some firms developed policies and tools requiring individuals to compare key criteria, such as costs, across a minimum number of alternatives before making a recommendation and to facilitate documentation.
• Leveraging periodic review by registered individuals
• We noted a firm that requires registered individuals to periodically perform and document their assessment of a reasonable range of alternatives (including KYP analyses) on a set number of security categories and options available to clients through the firm (e.g., five funds within each category, with the options including funds from different fund managers). Registered individuals can then rely on this analysis of alternatives when making their suitability determinations for multiple clients until the next review of the categories and options, which occurs on a basis that is sufficiently frequent given the type and complexity of the securities. The firm monitors all securities made available to clients on a weekly basis for significant changes, requiring registered individuals to update their KYP analysis and their analysis of alternatives when necessary due to the changes identified.
5. Inadequate suitability reassessments (Subsection 13.3(2) of NI 31-103, IDPC Rule 3402(2), MFD Rule 2.2.6(2))
Registrants must reassess a client's account and holdings to ensure they remain suitable and continue to put the client's interest first. At a minimum, suitability must be reassessed when the registrant conducts its periodic KYC review as set out in subsection 13.2(4.1) of NI 31-103 (IDPC Rule 3209(4), MFD Rule 2.2.4(f)).
Other suitability reassessment triggering events include:
• a change to the registered individual designated as responsible for the account,
• the registrant becomes aware of a KYP change in a security in the account that could result in the security or account not satisfying the suitability determination criteria, or
• the registrant becoming aware of a change in the client's KYC information that could result in the security or account not satisfying the suitability determination criteria.
(a) Issues identified
Issues noted relating to periodic suitability reassessments included:
• Inadequate documentation of reassessments -- Many firms failed to properly document periodic suitability reassessments or demonstrate that a full suitability review of the account and holdings had been conducted.
• No reassessment upon certain changes in a security -- Some registrants did not reassess suitability when a significant KYP change occurred and it was a change that could result in the security or the account no longer being suitable for the client.
• No reassessment upon a change to the registered individual responsible for the client's account -- Some PM firms use a team-based approach but designate a key advising representative to maintain KYC information and manage the client relationship. We noted instances where firms changed the key representative without recognizing this triggered a requirement to reassess suitability, given the representative's key role in the client relationship, including maintaining KYC information, which is an important input to suitability determinations.
(b) Guidance
Registrants are required to review the suitability of client accounts and the securities within the accounts according to the minimum time periods aligning with KYC reviews and updates, or more frequently if one of the prescribed triggering events occurs. These reviews should assess whether the account and the securities within the account continue to be suitable for the client and put the client's interest first.
As a reminder, the suitability determination requirement applies to recommendations or decisions to continue to hold securities. Suitability reassessments should consider, for example:
• whether alternative securities would better serve the client's interests (including consideration of, for example, transaction costs and tax implications).
• potential concentration or liquidity issues as a result of market movements.
The suitability reassessment process should align with the firm's business model and client circumstances. For example, a detailed periodic suitability reassessment for client accounts is critical for firms that follow a buy and hold long-term strategy for clients with minimal or no trading on a regular basis.
In cases where EMDs have ongoing relationships with their clients but clients hold illiquid securities with minimal or no redemption features, we recognize that the extent of the reassessment of the suitability determination may be limited due to the illiquid nature of the securities. However, we expect that those registrants will take this fact into account when making future recommendations for their clients, including any additional investments. For EMDs that have only a transactional relationship with clients (as described in Appendix F of 31-103CP), the requirement to reassess suitability for a client is not applicable because there is no ongoing relationship or client account.
Records should show a meaningful reassessment; generic notes like "no changes" are insufficient. Firms need a process to ensure reassessments occur on time. If broader or centralized assessments are used (e.g., model portfolios), individual client suitability must still be reassessed and clearly documented.
6. Client directed trades (Subsection 13.3(2.1) of NI 31-103, IDPC Rule 3402(5), MFD Rule 2.2.6(2.2))
Registrants must assess whether a client directed trade is suitable for the client and whether it would put the client's interest first. If the trade would not be suitable or put the client's interest first, the registrant must:
• inform the client of the determination and its basis;
• recommend an alternative action that is suitable and puts the client's interest first; and
• if the client still wishes to proceed, confirm and document the client's instruction to proceed.
(a) Issues identified
Many firms reviewed were unaware of the steps and documentation requirements for accepting client directed trades. Some specific issues noted during the reviews included:
• Lack of documentation for suitability determination -- Many registrants did not document the suitability determination they had performed prior to proceeding with the client requested investment action.
• Inadequate suitability determination -- Some registrants performed a general suitability determination on the proposed investment action but did not consider all of the suitability determination criteria, including a consideration of a reasonable range of alternative actions.
• No suitability determination for certain trades -- Some firms had inappropriately excluded certain client directed trades from their suitability determination processes, citing the trade size being too small (e.g., below a defined threshold established by the firm), and permitted the trades to be made without complying with the applicable requirements for accepting client directed trades.
(b) Guidance
When an instruction for a client directed trade is received, the registrant must first assess the suitability of the proposed investment action with consideration of all suitability criteria in subsection 13.3(1) of NI 31-103 (IDPC Rule 3402(1), MFD Rule 2.2.6(1)). If the action is not suitable or does not put the client's interest first, the registrant must follow the steps set in subsection 13.3(2.1) of NI 31-103 (IDPC Rule 3402(5), MFD Rule 2.2.6(2.2)) and maintain appropriate documentation. Simply noting that the client directed the trade is insufficient. If the proposed investment action is unsuitable and no suitable alternatives are available through the firm, the firm should recommend that the client not make the investment.
D. COMPLIANCE SYSTEM AND TRAINING (Section 11.1 of NI 31-103, IDPC Rule 1407 and 3904, MFD Rule 1.2.4(1), MFD Rule 2.5.1, and MFD Rule 2.10)
Section 11.1 of NI 31-103 (IDPC Rule 3904, MFD Rule 2.5.1 and 2.10)) requires firms to establish, maintain and apply policies and procedures that establish a system of controls and supervision sufficient to provide reasonable assurance that the firm and each individual acting on its behalf complies with securities legislation, including KYC, KYP and suitability determination requirements. In addition, subsection 11.1(2) of NI 31-103 (IDPC Rule 1407, MFD Rule 1.2.4(1)) explicitly requires registered firms to provide training to their registered individuals on compliance with securities legislation, including KYC, KYP and suitability determination obligations.
In our reviews, Staff identified issues with respect to the KYC, KYP and suitability determination policies and procedures of many firms. Staff also identified various issues related to training.
1. Policies and procedures (Subsection 11.1(1) of NI 31-103, IDPC Rule 3904(1) and (2), MFD Rule 2.5.1 and 2.10)
(a) Issues identified
Issues identified with KYC, KYP and suitability determination policies and procedures included the following:
• Outdated policies and procedures -- Some firms' policies and procedures had not been updated to reflect the new requirements under the CFRs.
• Policies and procedures not sufficiently tailored or detailed -- Some firms' policies and procedures were generic in nature and not tailored to their operations and lacked sufficient detail to enable individual registrants to understand their responsibilities. In some cases, firms' policies and procedures simply repeated the rule requirements without any detail regarding how compliance is to be achieved at the specific firm and what level of documentation is required to provide evidence of compliance.
(b) Guidance
Firms' policies and procedures should be comprehensive, up to date to reflect regulatory requirements, and tailored to their businesses. Policies and procedures that are intended to reflect the new KYC, KYP and suitability determination requirements under the CFRs should, at a minimum, cover the following areas:
KYC:
• how KYC information (including personal circumstances, financial circumstances, investment needs and objectives, investment knowledge, risk profile and investment time horizon) is collected for clients and how the registrant ensures a meaningful interaction with clients;
• the appropriate depth of KYC information that must be collected given the firm's business model, including the nature of the firm's relationships with its clients and the securities and services it offers;
• how to ensure that sufficient financial circumstances information is collected, including a client's:
• annual income,
• liquidity needs,
• financial assets,
• net worth, and
• whether the client is using leverage
• when distributing prospectus-exempt securities, the inquiries to be made and information to be documented relating to other exempt market investments held by the client;
• the process to determine the client's risk profile, including the process to obtain and confirm information from the client relating to both the client's risk tolerance and risk capacity, and how to resolve any potential conflicts between these elements when determining the client's risk profile;
• the process to have clients confirm the accuracy of all KYC information within a reasonable time after collecting the information;
• the process for reviewing clients' KYC information, including a process to ensure that any inconsistency in KYC information collected is identified and resolved, and a process to ensure that any inconsistencies between a client's KYC information and information documented in client agreements or investment policy statements are identified and resolved;
• the process for keeping KYC information collected current, including:
• the process to ensure periodic updates to KYC information are completed as required,
• describing what the registrant considers to be a significant change to client KYC information, and the process for updating the information within a reasonable time after the registrant becomes aware of a significant change, and
• setting out how KYC updates must be documented including the level of detail required and client confirmation of updated information.
KYP:
• the aspects of the firm's KYP process that are to be carried out by the firm and registered individuals, respectively; all processes used by the firm should be clearly described (e.g., if a firm uses centralized groups or automated systems to assist with aspects of its KYP obligations, the process followed should be set out in detail) and the individuals who are responsible for carrying out and supervising each process should be clearly identified;
• how the relevant aspects of the securities will be assessed, including:
• the structure, features and risks of the security, including the complexity of the security,
• the initial and ongoing costs of the security, and the impact of those costs,
• the parties involved in the security (e.g., management of the issuer, portfolio manager, product manufacturer, guarantors or significant counterparties), and
• whether there are any conflicts of interest inherent in the security (e.g., arising from compensation structure, related party issues or other factors);
• if the firm's KYP assessment varies for different types of securities or asset classes based on, for example, complexity, a clear and specific description as to what aspects are relevant for the different types of securities when performing the assessment;
• the process to perform KYP on model portfolios offered by the firm and the specific responsibilities of registered individuals in respect of KYP (i.e., performing KYP at the model portfolio level versus at the level of individual securities in the model portfolio), where applicable;
• if the reasonable range of alternatives for securities are identified and assessed during the KYP process, a clear description of the firm level process, as well as the process for documenting this and how it is incorporated into the suitability determination process;
• the approval process for the securities (or model portfolios, where applicable) to be made available to clients including specifying who is authorized to provide the approval and how evidence of approval will be maintained;
• a description of what the firm considers to be a significant KYP change to the securities that are made available to clients;
• the process to monitor the securities that are made available to clients for significant changes, including the frequency for monitoring and the criteria for revisiting the approval of the securities where appropriate;
• the process to notify registered individuals of any significant KYP change to a security so that the individuals can reassess their suitability determinations for client accounts as may be required;
• the process to ensure all registered individuals understand the relevant aspects of the securities made available to clients prior to purchasing, selling or recommending those securities to clients, including any necessary training for registered individuals;
• the books and records the firm must maintain to demonstrate compliance with KYP obligations, as well as the records registered individuals are expected to maintain to demonstrate compliance with their own KYP obligations;
• the process for assessing securities transferred into the firm from another registrant, as well as those that are a result of a client directed trade, within a reasonable time after the transfer or trade.
Suitability determinations:
• the basis upon which the firm makes a suitability determination for investment actions taken for clients, including when it is performed and criteria used;
• a description of how the necessary criteria are considered when making a suitability determination, including:
• the KYC information collected, ensuring that it is sufficiently up to date,
• the registrant's KYP assessment or understanding of the security,
• the process for assessing the potential impact of the investment action on the client's account, including the concentration and liquidity in an account, and any concentration and liquidity thresholds used by the registrant,
• the process for assessing the potential and actual impact of costs of the investment action on the client's return on investment,
• the process for considering a reasonable range of alternative actions available to the registrant through the firm,
• the process to ensure that all accounts of a client at the registrant are considered when making a suitability determination (e.g., in respect of concentration and liquidity);
• a description of how the registrant puts the client's interest first when making a suitability determination, including the process to consider whether a recommendation or decision for a client account would materially affect the concentration and liquidity of the client's investments across all of the client's accounts held at the firm, as applicable;
• triggering events that require the registrant to reassess suitability for a client;
• records to be maintained when documenting suitability determinations (including any periodic reassessments) including records of key assumptions, scope of data considered, and analysis performed before making a suitability determination;
• supervision of the suitability determination process to ensure that it is being consistently applied across the firm including, if applicable, a process to periodically review client files or a reasonable sample of client files;
• process to follow when a client directed trade is requested, including when the registrant has determined that the trade is unsuitable and/or does not put the client's interest first.
2. Training (Subsection 11.1(2) of NI 31-103, IDPC Rule 1407 and 3904(3), MFD Rule 1.2.4(1))
(a) Issues identified
Staff identified the following issues in firms' training programs in relation to KYC, KYP and suitability determination requirements:
• Inadequate training -- For some firms, the training provided was not comprehensive and did not cover key components of KYC, KYP and suitability determination requirements and the firms' processes to ensure compliance. For example, the following topics were frequently not addressed in training materials:
• KYC
• the appropriate level of KYC information to be collected
• the frequency and procedures for KYC updates, including when there is a significant change
• what constitutes a significant change to a client's KYC information
• how to determine a client's risk profile, including how to collect and assess both risk tolerance and risk capacity information from clients
• how to obtain clients' confirmation of KYC information
• KYP
• how to assess key features of securities
• where appropriate (e.g., for new or complex products), detailed security specific training that enables registered individuals to discharge their individual KYP obligations
• the requirement to assess and understand securities transferred in
• Suitability determinations
• the factors that need to be considered to determine suitability and how to assess suitability
• what types of changes to client KYC information require a suitability reassessment
• what types of KYP changes to securities in the account require a suitability reassessment
• when periodic suitability determinations are required
• the need to perform a suitability determination on a client directed trade regardless of the value or frequency of the trade,
• examples of what it means to put a client's interest first when determining suitability
• how to document suitability determinations
• Inadequate training from service providers -- Some firms relied on third-party service providers to provide training; however, in some cases, the third-party training was found to be insufficient (i.e., did not cover all key components of KYC, KYP and suitability determination requirements and processes to ensure compliance), inaccurate or not tailored to the firm's operations.
• Training not provided to all registered individuals -- For some firms, no training was provided to registered individuals who deal only with institutional clients.
• Training was optional -- For some firms, the training sessions provided on KYC, KYP and suitability determinations were optional and the firm did not ensure that all its registered individuals received the required training.
• Inadequate evidence that training occurred -- In some cases, although firms represented to Staff that training was provided, there was no or inadequate documentation maintained to evidence the content of training and that the training was provided.
• Inadequate evidence of attendance or completion -- In some cases, although there was evidence that firms provided training, there was no documentation maintained to evidence that each of the firm's registered individuals had completed the training.
(b) Guidance
To comply with the requirements in subsection 11.1(2) of NI 31-103 (IDPC Rule 1407 and 3904(3), MFD Rule 1.2.4(1)), training provided by a registered firm should be tailored to the firm's operations and be appropriate for its size. Where the firm outsources its training program, the firm is responsible for assessing the adequacy of the third-party training provided, including ensuring that it is accurate, sufficient and tailored to the operations of the firm.
Training on KYC, KYP and suitability determination requirements, as well as other required training, should be comprehensive and cover all key elements of the requirements, with relevant examples where applicable. This training should be mandatory for all registered individuals, and firms should keep records of the training provided, including training content and attendance, to demonstrate that they have met the requirements.
Specific to KYP requirements, where new or complex securities are approved by firms to be made available to clients, firms should consider whether additional product specific training is necessary for registered individuals to reasonably understand the securities and make appropriate suitability determinations.
The firm should consider assessing whether its registered individuals understood the training. An effective practice observed in our reviews included firms that required a quiz to be completed by registered individuals at the end of the training, and a minimum mark (e.g., over 75%) on the quiz was required to evidence that the registered individual completed the training successfully.
All registrants must have policies, procedures and systems that are appropriate to their business models to successfully comply with regulatory requirements. The observations and practices identified in this Notice are intended to provide additional Staff guidance on how we expect registrants to comply with the enhanced KYC, KYP and suitability determination requirements that came into effect as part of the CFRs, while keeping in mind efficiencies that may arise by registrants tailoring their processes to reflect their business models. Staff will continue to review and evaluate firms' compliance with securities legislation, including all CFR requirements, during regular compliance examinations and will use all regulatory tools available to address any non-compliance or other issues identified.
The CFRs Implementation Committee was established in 2020 to consider operational challenges industry stakeholders were facing when implementing the CFRs. A list of questions received by the CFRs Implementation Committee and our responses can be found at CFRs FAQs. Registrants are encouraged to refer to this CFRs FAQs document for additional guidance on complying with the CFRs.
Joint CSA / CIRO Staff Notice 31-363 Client Focused Reforms: Review of Registrants' Conflicts of Interest Practices and Additional Guidance can also be referred to for additional guidance on compliance with the conflicts of interest requirements that came into effect as part of the CFRs.
Firms can also keep up to date on regulatory developments by reviewing Staff notices and publications, participating in information outreach sessions organized by, and signing up for mailings from, the various CSA members and CIRO.
CSA and CIRO staff will continue to identify best practices for different regulatory platforms and business models as part of ongoing reviews, and additional guidance will be published where appropriate. CIRO, for its part, will be publishing further guidance on KYC, KYP and suitability, based not only on findings from examinations of CIRO member firms, but also to reflect the Consolidated Rulebook that will be published in the future.
QUESTIONS
Please refer your questions to any of the following Staff:
Julio Arboleda Ramirez |
Matias Pendola |
Senior Legal Counsel |
Manager, Registrant Regulation |
Alberta Securities Commission |
Alberta Securities Commission |
403-592-4736 |
403-355-3892 |
Julio.ArboledaRamirez@asc.ca |
Matias.Pendola@asc.ca |
|
|
Adam Hillier |
Ali Zaheer |
Team Lead, Registrant Oversight |
Senior Regulatory Analyst, Registrant Oversight |
Alberta Securities Commission |
Alberta Securities Commission |
403-297-2990 |
403-297-2422 |
Adam.Hillier@asc.ca |
Ali.Zaheer@asc.ca |
|
|
Gabriel Chénard |
Jason Donovan |
Analyste expert à la réglementation |
Inspecteur coordonnateur |
Direction de l'encadrement des intermédiaires |
Direction du service de l'inspection -- valeurs mobilières |
Autorité des marchés financiers |
Autorité des marchés financiers |
514-395-0337 (4482) |
514-395-0337 (4756) |
gabriel.chenard@lautorite.qc.ca |
Jason.Donovan@lautorite.qc.ca |
|
|
Crystal He |
Colleen Ng |
Lead Compliance Analyst, Capital Markets Regulation |
Senior Compliance Analyst, Capital Markets Regulation |
British Columbia Securities Commission |
British Columbia Securities Commission |
604-899-6795 |
604-899-6651 |
che@bcsc.bc.ca |
cng@bcsc.bc.ca |
|
|
Khalil Jessa |
|
Senior Legal Counsel |
|
British Columbia Securities Commission |
|
604-899-6933 |
|
kjessa@bcsc.bc.ca |
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|
|
Angela Duong |
|
Deputy Director, Compliance and Oversight |
|
Manitoba Securities Commission |
|
204-945-5195 |
|
angela.duong@gov.mb.ca |
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|
|
Michelle Doucette |
|
Compliance Officer, Securities Division |
|
Financial and Consumer Services Commission of New Brunswick |
|
506-719-5223 |
|
michelle.doucette@fcnb.ca |
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|
|
Cynthia Tambago-Alday |
Angela Scott |
Deputy Director, Registration & Compliance |
Compliance Examiner |
Nova Scotia Securities Commission |
Nova Scotia Securities Commission |
902-424-5393 |
902-424-4628 |
cynthia.tambago-alday@novascotia.ca |
Angela.Scott@novascotia.ca |
|
|
Samantha Cardinale |
Stratis Kourous |
Legal Counsel, Registration, Inspections and Examinations |
Senior Accountant, Registration, Inspections and Examinations |
Ontario Securities Commission |
Ontario Securities Commission |
416-597-7230 |
416-305-8797 |
scardinale@osc.gov.on.ca |
skourous@osc.gov.on.ca |
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|
Carlin Fung |
Erin Seed |
Senior Accountant, Registration, Inspections and Examinations |
Manager, Registration, Inspections and Examinations |
Ontario Securities Commission |
Ontario Securities Commission |
416-593-8226 |
647-625-3393 |
cfung@osc.gov.on.ca |
eseed@osc.gov.on.ca |
|
|
Alizeh Khorasanee |
Estella Tong |
Manager, Registration, Inspections and Examinations |
Senior Accountant, Registration, Inspections and Examinations |
Ontario Securities Commission |
Ontario Securities Commission |
416-716-3307 |
416-593-2337 |
akhorasanee@osc.gov.on.ca |
etong@osc.gov.on.ca |
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|
Curtis Brezinski |
|
Compliance Auditor, Securities Division |
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Financial and Consumer Affairs Authority of Saskatchewan |
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306-787-5876 |
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curtis.brezinski@gov.sk.ca |
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|
Louise Hamel |
David Wright |
Vice President, Member Compliance |
Senior Counsel, Business Conduct Compliance |
Canadian Investment Regulatory Organization |
Canadian Investment Regulatory Organization |
416-943-6911 |
416-943-6891 |
LHamel@ciro.ca |
dwright@ciro.ca |
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|
Suzanne Watson |
|
Senior Director, Business Conduct Compliance |
|
Canadian Investment Regulatory Organization |
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416-865-5022 |
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swatson@ciro.ca |
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Dream Residential Real Estate Investment Trust
National Policy 11-206 Process for Cease to be a Reporting Issuer Applications -- The issuer ceased to be a reporting issuer under securities legislation.
Securities Act, R.S.O. 1990, c. S.5, as am., s. 1(10)(a)(ii).
December 10, 2025
The principal regulator in the Jurisdiction has received an application from the Filer for an order under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) that the Filer has ceased to be a reporting issuer in all jurisdictions of Canada in which it is a reporting issuer (the Order Sought).
Under the Process for Cease to be a Reporting Issuer Applications (for a passport application):
a) the Ontario Securities Commission is the principal regulator for this application, and
b) the Filer has provided notice that subsection 4C.5(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in British Columbia, Alberta, Saskatchewan, Manitoba, Quebec, New Brunswick, Nova Scotia, Prince Edward Island and Newfoundland and Labrador.
Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this order, unless otherwise defined.
This order is based on the following facts represented by the Filer:
1. the Filer is not an OTC reporting issuer under Multilateral Instrument 51-105 Issuers Quoted in the U.S. Over-the-Counter Markets;
2. the outstanding securities of the Filer, including debt securities, are beneficially owned, directly or indirectly, by fewer than 15 securityholders in each of the jurisdictions of Canada and fewer than 51 securityholders in total worldwide;
3. no securities of the Filer, including debt securities, are traded in Canada or another country on a marketplace as defined in National Instrument 21-101 Marketplace Operation or any other facility for bringing together buyers and sellers of securities where trading data is publicly reported;
4. the Filer is applying for an order that the Filer has ceased to be a reporting issuer in all of the jurisdictions of Canada in which it is a reporting issuer; and
5. the Filer is not in default of securities legislation in any jurisdiction.
The principal regulator is satisfied that the order meets the test set out in the Legislation for the principal regulator to make the order.
The decision of the principal regulator under the Legislation is that the Order Sought is granted.
OSC File #: 2025/0693
Multilateral Instrument 11-102 Passport System and National Policy 11-206 Process for Cease to be a Reporting Issuer Applications -- Securities Act s. 88 Cease to be a reporting issuer in BC -- The securities of the issuer are beneficially owned by not more than 50 persons and are not traded through any exchange or market -- The issuer is not an OTC reporting issuer; the securities of the issuer are beneficially owned by fewer than 15 securityholders in each of the jurisdictions of Canada and fewer than 51 securityholders worldwide; no securities of the issuer are traded on a market in Canada or another country; the issuer is not in default of securities legislation.
National Policy 11-206 Process for Cease to be a Reporting Issuer Applications -- The issuer ceased to be a reporting issuer under securities legislation.
Securities Act, R.S.B.C. 1996, c. 418, s. 88.
Securities Act, R.S.O. 1990, c. S.5, as am., s. 1(10)(a)(ii).
Citation: 2025 BCSECCOM 531
December 9, 2025
¶ 1 The securities regulatory authority in each of the Jurisdictions (Decision Maker) has received an application from the Filer for an order under the securities legislation of the Jurisdictions (the Legislation) that the Filer has ceased to be a reporting issuer in all jurisdictions of Canada in which it is a reporting issuer (the Order Sought).
Under the Process for Cease to be a Reporting Issuer Applications (for a dual application):
(a) the British Columbia Securities Commission is the principal regulator for this application,
(b) the Filer has provided notice that subsection 4C.5(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in Alberta, and
(c) this order is the order of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.
¶ 2 Terms defined in National Instrument 14-101 Definitions, and MI 11-102 have the same meaning if used in this order, unless otherwise defined.
¶ 3 This order is based on the following facts represented by the Filer:
1. the Filer is not an OTC reporting issuer under Multilateral Instrument 51-105 Issuers Quoted in the U.S. Over-the-Counter Markets;
2. the outstanding securities of the Filer, including debt securities, are beneficially owned, directly or indirectly, by fewer than 15 securityholders in each of the jurisdictions of Canada and fewer than 51 securityholders in total worldwide;
3. no securities of the Filer, including debt securities, are traded in Canada or another country on a marketplace as defined in National Instrument 21-101 Marketplace Operation or any other facility for bringing together buyers and sellers of securities where trading data is publicly reported;
4. the Filer is applying for an order that the Filer has ceased to be a reporting issuer in all of the jurisdictions of Canada in which it is a reporting issuer; and
5. the Filer is not in default of securities legislation in any jurisdiction.
¶ 4 Each of the Decision Makers is satisfied that the order meets the test set out in the Legislation for the Decision Maker to make the order.
The decision of the Decision Makers under the Legislation is that the Order Sought is granted.
OSC File #: 2025/0702
National Policy 11-206 Process for Cease to be a Reporting Issuer Applications -- application for an order that the issuer cease to be a reporting issuer under applicable securities laws -- all issued and outstanding common shares of issuer acquired in going private transaction completed by way of court-approved plan of arrangement under the Business Corporations Act (Quebec) -- issuer represents that, but for being in default as a result of failing to file interim filings that came due following completion of the arrangement, it meets the criteria for the simplified procedure under NP 11-206 -- contingent value rights issued to former shareholders of the issuer as part of the consideration in connection with the arrangement -- CVRs are uncertificated, non-transferable (other than in limited circumstances) contractual rights governed by a CVR Agreement -- CVRs are not listed on any market or exchange -- CVRs do not represent any equity or ownership interest in the issuer, the purchaser any affiliate thereof (or any other person) and are not evidenced by any certificates or other instruments -- CVRs do not have any voting or dividend rights, and no interest will accrue on any amounts payable on the CVRs to any holder thereof -- arrangement agreement includes robust dispute resolution procedures with respect to determination of the payout under the CVRs -- relief granted based on the particular facts and circumstances of the application -- issuer deemed to have ceased to be a reporting issuer under applicable securities laws.
Securities Act, R.S.O. 1990, c. S.5, as am., s. 1(10)(a)(ii).
National Policy 11-206 Process for Cease to be a Reporting Issuer Applications.
[Original text in French]
November 26, 2025
The securities regulatory authority or regulator in each of the Jurisdictions (each a Decision Maker) has received an application (the Application) from the Filer for an order under the securities legislation of the Jurisdictions (the Legislation) that the Filer has ceased to be a reporting issuer in all jurisdictions of Canada in which it is a reporting issuer (the Order Sought).
Under the Process for Cease to be a Reporting Issuer Applications (for a dual application):
a) the Autorité des marchés financiers is the principal regulator for this application,
b) the Filer has provided notice that subsection 4C.5(1) of Regulation 11-102 respecting Passport System (Regulation 11-102) is intended to be relied upon in Alberta, British Columbia, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Prince Edward Island and Saskatchewan (together with the Jurisdictions, the Reporting Jurisdictions), and
c) this order is the order of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.
Terms defined in Regulation 14-101 respecting Definitions, Regulation 11-102 and, in Québec, in Regulation 14-501Q on definitions and the National Policy 11-206 respecting Process for Cease to be a Reporting Issuer Applications (NP 11-206) have the same meaning if used in this order, unless otherwise defined.
This order is based on the following facts represented by the Filer:
1. The Filer is a corporation governed by the Quebec Business Corporations Act with its head office located in Montréal, Québec.
2. The Filer is a reporting issuer under the securities legislation of each of the Reporting Jurisdictions.
3. On July 2, 2025, the Filer entered into an arrangement agreement with CB Biotechnology, LLC (the Arrangement).
4. The Arrangement was approved at a special meeting of shareholders of the Filer held on September 12, 2025 and by the Québec Superior Court (Commercial Division) on September 16, 2025.
5. The Arrangement was completed on September 25, 2025 (the Closing).
6. Following the Closing, all of the issued and outstanding common shares of the Filer (the Filer Shares) are beneficially owned, directly or indirectly, by CB Biotechnology, LLC. No other securities of the Filer are outstanding.
7. The Filer Shares were delisted from the Toronto Stock Exchange on September 26, 2025 and from the Nasdaq Stock Market LLC on September 25, 2025.
8. The Filer is not an OTC reporting issuer under Regulation 51-105 respecting Issuers Quoted in the U.S. Over-the-Counter Markets.
9. The outstanding securities of the Filer, including debt securities, are beneficially owned, directly or indirectly, by fewer than 15 securityholders in each of the jurisdictions of Canada and fewer than 51 securityholders in total worldwide.
10. No securities of the Filer, including debt securities, are traded in Canada or another country on a marketplace as defined in Regulation 21-101 respecting Marketplace Operation or any other facility for bringing together buyers and sellers of securities where trading data is publicly reported.
11. The Filer has no intention to seek public financing by way of an offering of securities.
12. The Filer is not in default of securities legislation in any jurisdiction, except for the filing of, as required under National Instrument 51-102 Continuous Disclosure Obligations, its interim financial statements and related management's discussion and analysis for the interim period ending on August 31, 2025; and except for the filing of the related certificates required under National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings (collectively, the Interim Filings).
13. On October 3, 2025, the Filer was eligible to obtain the Order Sought under the simplified procedure in section 19 of NP 11-206; however, because the Filer is in default for failing to file the Interim Filings on October 14, 2025, the Application is treated under the procedure for other applications in section 21 of NP 11-206.
14. The Filer is applying for an order that the Filer has ceased to be a reporting issuer in all the Reporting Jurisdictions. Upon granting of the Order Sought, the Filer will no longer be a reporting issuer or the equivalent thereof in any of the Reporting Jurisdictions.
Each of the Decision Makers is satisfied that the order meets the test set out in the Legislation for the Decision Maker to make the order.
The decision of the Decision Makers under the Legislation is that the Order Sought is granted.
OSC File #: 2025/0596
Sherobee Glen Limited Partnership
National Policy 11-206 Process for Cease to be a Reporting Issuer Applications -- Application to cease to be a reporting issuer under applicable securities laws -- the issuer is not an OTC reporting issuer; the securities of the issuer are beneficially owned by fewer than 15 securityholders in each of the jurisdictions of Canada, except for Ontario, and by fewer than 51 securityholders worldwide; no securities of the issuer are traded on any exchange or marketplace in Canada or another country; the issuer is not in default of securities legislation but for its failure to file interim financial statements, related interim management's discussion and analysis and certifications of the foregoing, which filings were not due until after the closing of a going-private transaction.
Securities Act, R.S.O. 1990, c. S.5, as am., s. 1(10)(a)(ii).
Order No. 7735
December 11, 2025
The securities regulatory authority in each of the Jurisdictions (Decision Maker) has received an application from the Filer for an order under the securities legislation of the Jurisdictions (the Legislation) that the Filer has ceased to be a reporting issuer in all jurisdictions of Canada in which it is a reporting issuer (the Order Sought).
Under the Process for Cease to be a Reporting Issuer Applications (for a dual application):
(a) the Manitoba Securities Commission is the principal regulator for this application;
(b) the Filer has provided notice that subsection 4C.5(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in British Columbia, Alberta, Saskatchewan, Québec and Prince Edward Island; and
(c) this order is the order of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.
Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this order, unless otherwise defined.
This order is based on the following facts represented by the Filer:
1. the Filer is a limited partnership formed under the laws of the Province of Ontario, by its general partner, 489214 Ontario Limited (the General Partner), pursuant to a limited partnership agreement dated September 28, 1982, as amended (the Limited Partnership Agreement), and a reporting issuer in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Québec and Prince Edward Island (the Reporting Jurisdictions).
2. the Filer's head office is located at 2600 Seven Evergreen Place in Winnipeg, Manitoba.
3. the Filer owns and operates a 96-suite residential apartment property located in Mississauga, Ontario (the Project). Shelter Canadian Properties Limited (Shelter), a private real estate company involved in property management and development, manages the Project.
4. the Filer's authorized capital consists of 200 units (the Units), of which 200 Units are issued and outstanding as at the date hereof. Each Unit entitles the holder thereof to a portion of the profits of the Filer and to participate and vote on matters of the Filer in accordance with the terms and conditions of the Limited Partnership Agreement.
5. The Filer has no securities (including debt securities) issued and outstanding, other than the Units and non-convertible mortgage loans which are secured against the Project and assets of the Filer.
6. the Filer became a reporting issuer in British Columbia, Alberta, Saskatchewan, Manitoba. Ontario, Québec and Prince Edward Island when it distributed Units pursuant to prospectus dated July 28, 1982 (the Offering). The purpose of the Offering was to finance the acquisition, development and leasing of the Project. The Filer has not conducted an offering of Units or any other securities since the Offering.
7. based upon the Filer's records, and to the best knowledge of the Filer, the Units are held by 35 limited partners -- 22 in Ontario, 6 in Manitoba, 2 in New Brunswick, 1 in Alberta, 1 in Québec, 1 in Newfoundland and Labrador and 2 whose residence is uncertain.
8. to the best knowledge of the Filer, the current limited partners consist of the original limited partners and limited partners that resulted from foreclosures, liquidation by the original limited partners to an affiliate of Shelter and transfers from the estates of the original limited partners.
9. all of the original limited partners were residents in the Reporting Jurisdictions at the time of the Offering.
10. the Filer is not eligible to cease to be a reporting issuer pursuant to the simplified procedure in Section 19 of National Policy 11-206 Process for Cease to be a Reporting Issuer Applications as the Filer has 22 limited partners in Ontario.
11. the Filer conducted a vote of its limited partners, at a meeting of the limited partners held on October 9, 2025, and a majority of the limited partners voted in favour of the Filer making an application to the Manitoba Securities Commission and the Ontario Securities Commission to cease to be a reporting issuer, with 99.3421% of the votes received being affirmative votes.
12. the Filer's only asset is the Project. The Filer does not intend to acquire any other assets.
13. the Filer is not an OTC reporting issuer under Multilateral Instrument 51-105 -- Issuers Quoted in the U.S. Over-the-Counter Markets.
14. no securities of the Filer, including debt securities, are traded in Canada or another country on a marketplace as defined in National Instrument 21-101 Marketplace Operation or any other facility for bringing together buyers and sellers of securities where trading data is publicly reported.
15. the Filer is subject to a failure-to-file cease trade order issued by the British Columbia Securities Commission on July 10, 1992, for the Filer's failure to file interim financial statements for the nine-month period ended July 31, 1991, and interim financial statements for the three-month period ended January 31, 1992 (the FFCTO in respect of the Unfiled Continuous Disclosure Documents).
16. the Filer has concurrently applied to the British Columbia Securities Commission under National Policy 12-202 Revocation of Certain Cease Trade Orders for an order under the securities legislation of British Columbia for full revocation of the cease trade order issued in British Columbia without requiring the Filer to file the Unfiled Continuous Disclosure Documents, to be effective on the same date as the Order Sought.
17. the Filer is not in default of any requirement of the FFCTO or the applicable securities legislation of any jurisdiction of Canada or the rules and regulations made pursuant thereto, except for the obligation to file the Unfiled Continuous Disclosure Documents.
18. with respect to the continuing protection of the limited partners, the Filer will continue to prepare and deliver to the limited partners annual audited and semi-annual unaudited financial statements prepared in accordance with the Limited Partnership Agreement.
19. the Filer, upon the grant of the Order Sought, will no longer be a reporting issuer in any jurisdiction of Canada.
Each of the Decision Makers is satisfied that the order meets the test set out in the Legislation for the Decision Maker to make the order.
The decision of the Decision Makers under the Legislation is that the Order Sought is granted.
OSC File #: 2025/0650
RBC Global Asset Management Inc. and The Top Funds
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Relief from the investment fund conflict of interest investment restrictions and management company reporting requirements in ss. 111(2)(c)(i) & (ii), 111(4) and 117(1) of the Securities Act (Ontario), the self-dealing restrictions for dealer managed investment funds in s. 4.1(2) of NI 81-102 and for registered advisers in s. 13.5(2)(a) of NI 31-103, and the control restriction in s. 2.2(1) of NI 81-102, to permit public investment funds to invest in related underlying investment vehicles that are not investment funds and not reporting issuers -- Relief granted subject to conditions -- Relief revokes and replaces prior relief.
Securities Act, R.S.O. 1990, c. S.5, as am., ss. 111(2)(c)(i) & (ii), 111(4), 113, 117(1)1 and 117(2).
National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations, ss. 13.5(2)(a) and 15.1.
National Instrument 81-102 Investment Funds, ss. 2.2(1), 4.1(2) and 19.1.
December 11, 2025
The principal regulator in the Jurisdiction has received an application from the Filer, which is the manager of certain investment funds managed by the Filer or by an affiliate of the Filer that are reporting issuers subject to NI 81-102 (the Existing Top Funds) and any additional investment funds of which the Filer, or an affiliate of the Filer, may be the manager in the future (the Future Top Funds and together with the Existing Funds, the Top Funds), for a decision under the securities legislation of the Jurisdiction (the Legislation) to revoke and replace the Current Relief (as defined below) (the Revocation) and an exemption, from:
(a) in respect of the Top Funds, the restrictions in the Legislation which prohibit:
(i) an investment fund from knowingly making an investment in a person or company in which the investment fund, alone or together with one or more related investment funds, is a substantial securityholder,
(ii) an investment fund from knowingly making an investment in an issuer in which,
(A) any officer or director of the investment fund, its management company or distribution company or an associate of any of them, or
(B) any person or company who is a substantial security holder of the investment fund, its management company or its distribution company,
has a significant interest;
(b) in respect of the Top Funds, subsection 2.2(1) (the Control Restriction) of National Instrument 81-102 Investment Funds (NI 81-102) in order to permit each of the Top Funds to purchase a security of an RBC Private Market Fund (as defined below) if immediately after the purchase, the Top Fund would hold securities representing more than 10% of (a) the votes attaching to the outstanding voting securities of the RBC Private Market Fund or (b) the outstanding equity securities of the RBC Private Market Fund (the Control Relief);
(c) in respect of the Top Funds, the prohibition in paragraph 4.1(2) of NI 81-102 against a "dealer managed investment fund" (as defined in NI 81-102) knowingly making an investment in an issuer in which any partner, director, officer or employee of the investment fund's management company or an affiliate or associate of the investment fund's management company is a partner, director or officer;
(d) in respect of the Filer and each affiliate of the Filer that is a registered adviser, the prohibition in paragraph 13.5(2)(a) of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registration Obligations (NI 31-103) against knowingly causing a Top Fund to invest in securities of any issuer in which a responsible person or an associate of a responsible person is a partner, officer or director, unless the fact is disclosed to the client and the written consent of the client to the investment is obtained before the purchase (this restriction, together with the restrictions described in paragraphs (a) and (c) above are referred to herein as the Investment Fund Conflict of Interest Investment Restrictions), and
(e) in respect of the Filer and each affiliate that acts as manager of a Public Top Fund, the requirement to prepare a report in accordance with the requirements of the Legislation of every transaction by a Public Top Fund involving a purchase of securities from, or sale of securities to, any related person or company (the Investment Fund Conflict of Interest Reporting Requirement);
(a) through (e) above, together with the Revocation, the Requested Relief).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission (the OSC) is the principal regulator for the application; and
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11- 102 Passport System (Ml 11-102) is intended to be relied upon in all of the provinces and territories of Canada other than Ontario (together with Ontario, the Jurisdictions).
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Current Relief means the decision in respect of the Filer and the Top Funds dated December 11, 2023.
This decision is based on the following facts represented by the Filer:
The Filer
1. The Filer is a corporation formed by amalgamation under the federal laws of Canada and its head office is located in Toronto, Ontario.
2. The Filer is an indirect, wholly-owned subsidiary of Royal Bank of Canada.
3. The Filer is registered as an adviser in the category of portfolio manager and as a dealer in the category of exempt market dealer under the securities legislation of each Jurisdiction, is registered as an investment fund manager in each of British Columbia, Ontario, Québec and Newfoundland and Labrador and is also registered in Ontario as a commodity trading manager.
4. The Filer is not in default of securities legislation in any of the Jurisdictions.
The Top Funds
5. Each Top Fund is, or will be, a reporting issuer in each of the Jurisdictions.
6. Each Top Fund distributes, or will distribute, its securities under a simplified prospectus or long-form prospectus (each, a Prospectus) prepared in accordance with National Instrument 81-101 Mutual Fund Prospectus Disclosure (NI 81-101) or National Instrument 41-101 General Prospectus Requirements, as applicable (NI 41-101), as the case may be.
7. The securities of each Top Fund are, or will be, qualified for distribution in one or more Jurisdictions.
8. Each Existing Top Fund is not in default of any of the requirements of securities legislation in any of the Jurisdictions.
9. Each Top Fund is, or will be, permitted by NI 81-102 to invest up to 10% of its net assets in illiquid assets, which includes the RBC Private Market Funds. A Top Fund's investment in securities of the RBC Private Market Funds is, or will be, consistent with its investment objectives. The Prospectus of each Top Fund discloses, or will disclose, in its investment strategies that the Top Fund may invest up to 10% of its net assets directly or indirectly in illiquid assets, measured at the time of investment, including in RBC Private Market Funds.
10. Each Top Fund is, or will be, subject to National Instrument 81-107 Independent Review Committee for Investment Funds (NI 81-107) and the Filer has established, or will establish, an independent review committee (IRC) to review conflict of interest matters pertaining to the Top Funds as required by NI 81-107.
11. RBC GAM is the asset management division of Royal Bank of Canada (RBC). RBC GAM provides a comprehensive range of investment management services and solutions to individual, high-net-worth and institutional investors through mutual funds, exchange-traded funds, hedge funds and pooled funds, separate accounts and specialty investment strategies.
12. RBC GAM currently manages two open-ended private funds, namely, RBC Canadian Core Real Estate Fund and RBC Global Infrastructure Fund LP (collectively, the Existing RBC Private Market Funds), each of which offer securities on a private placement basis pursuant to an exemption from the prospectus requirement under applicable Canadian securities laws.
13. The Filer, or an affiliate of the Filer, may act as manager to one or more private funds in the future (each, a Future RBC Private Market Fund and together with the Existing RBC Private Market Funds, the RBC Private Market Funds). Each Future RBC Private Market Fund will offer its securities on a private placement basis pursuant to an exemption from the prospectus requirement under applicable Canadian securities laws.
14. Each RBC Private Market Fund provides, or will provide, exposure to private equity, private real estate, private infrastructure, private credit investments or other private alternative investment strategies
15. The RBC Private Market Funds are not, or will not be, subject to NI 81-102, and have not, and will not, prepare a prospectus in accordance with NI 81-101 or NI 41-101.
16. The RBC Private Market Funds are not, and will not be, reporting issuers in any of the Jurisdictions or listed on any recognized stock exchange.
17. No RBC Private Market Fund is, or will be, an "investment fund" pursuant to the securities legislation of the Jurisdictions.
18. The RBC Private Market Funds are, or will be, sold only to investors who qualify to invest in the RBC Private Market Funds pursuant to an exemption from the prospectus requirement under applicable Canadian securities laws.
19. The Existing RBC Private Market Funds are not in default of the securities legislation of any of the Jurisdictions.
20. The RBC Private Market Funds are, or will be, held by accredited investors who are affiliated with the Filer as well as accredited investors that are not affiliated with the Filer.
21. There is no, and it is not expected that there will be, an established, publicly available secondary market for securities of the RBC Private Market Funds and the redemption rights applicable to investors in the RBC Private Market Funds are, or will be, more limited than those applicable to mutual funds subject to NI 81-102. Accordingly, investors in the RBC Private Market Funds may not be able to readily dispose of their securities in an RBC Private Market Fund and any securities that a Top Fund holds in an RBC Private Market Fund is, or will be, considered an "illiquid asset" under NI 81-102.
22. The value of the portfolio assets of each of the Existing RBC Private Market Funds (held directly or indirectly) is determined by the Filer using appraisals (which are consistent with (a) relevant international standards and principles, namely the International Private Equity and Venture Capital Valuation Guidelines, International Valuation Standards set out by the International Valuation Standards Council, and/or IFRS, (b) Canadian Uniform Standards of Professional Appraisal Practice (CUSPAP) as defined and revised by the Appraisal Institute of Canada) or (c) any other industry standard for valuations, as applicable) by, in the case of RBC Canadian Core Real Estate Fund, the fund's asset manager and in the case of RBC Global Infrastructure Fund LP, using industry-wide recognized valuation methodologies, and in both instances, the valuation of each asset held by the Existing RBC Private Market Fund is externally appraised and/or verified by an independent third-party valuation firm at least once every 12 months.
23. On an annual basis the financial statements of each RBC Private Market Fund, are, or will be, audited by the RBC Private Market Fund's external auditors, being an internationally recognized independent accounting and audit firm (typically PricewaterhouseCoopers LLP (Canada), Ernst & Young LLP, KPMG LLP or Deloitte LLP), as part of their annual independent audit. The applicable audit firm also audits the controls and processes in place to ensure the RBC Private Market Fund's portfolio investments are accurately valued in accordance with the RBC Private Market Fund's valuation policy.
24. The assets of each Future RBC Private Market Fund will be appraised and/or verified by an independent third-party valuation firm at least once every 12 months.
25. Absent the Requested Relief, a Top Fund would be prohibited by subsection 2.2(1)(a) of NI 81-102 from investing in an RBC Private Market Fund beyond the confines of the Control Restriction. Due to the expected size disparity between the Top Funds and the RBC Private Market Funds, with the Top Funds expected be significantly larger than the RBC Private Market Funds, it is likely that a relatively small investment, on a percentage of net asset value basis, by a relatively larger Top Fund in an RBC Private Market Fund could result in such Top Fund holding securities representing more than 10 percent (10%) of (a) the votes attaching to the outstanding voting securities of the RBC Private Market Fund or (b) the outstanding equity securities of the RBC Private Market Fund, contrary to the Control Restriction.
26. A Top Fund will not invest in any RBC Private Market Fund for the purpose of exercising control over, or management of, the RBC Private Market Fund. The securities of each RBC Private Market Fund that would be held by the Top Funds do not, and will not, provide a Top Fund with any right to (a) appoint directors or observers to any board of the applicable RBC Private Market Fund or its manager, (b) restrict management of any RBC Private Market Fund or be involved in the decision-making with respect to the investments made by the applicable RBC Private Market Fund or (c) restrict the transfer of securities of the applicable RBC Private Market Fund by other investors in the RBC Private Market Fund. Any voting rights associated with the securities of the RBC Private Market Funds that would be held by the Top Funds do not, and will not, provide a Top Fund with any right to approve, or otherwise participate in the decision-making process associated with the investments made by the RBC Private Market Funds.
27. The Top Funds will not have any look-through rights with respect to the individual portfolio investments held by any of the RBC Private Market Funds. Further, the Top Funds will not have any rights to, or responsibility for, administering any of the portfolio investments held by any of the RBC Private Market Funds.
28. Each RBC Private Market Fund is expected to have, following the completion of its initial investment period, certain diversification requirements which may include limiting the indirect exposure of the Top Funds to any single underlying portfolio company, asset class, sector or geography, as the case may be.
29. The Filer believes that a meaningful allocation to private markets investments will provide the Top Funds' investors with unique diversification opportunities and represents an appropriate investment tool for the Top Funds that has not been widely available in the past. Private equity, private real estate, private infrastructure, private credit investments and other private alternative investment strategies have historically performed well in down markets; the Filer believes that permitting a Top Fund to increase its allocation to such strategies, offers the potential to improve a Top Fund's risk adjusted returns.
30. The Filer believes that an optimal way to access such investment strategies is through investments in the RBC Private Market Funds. Investing in the RBC Private Market Funds will provide the Top Funds with access to investments in these strategies that the Top Funds would not otherwise have exposure to through portfolios diversified across different strategies, industry sectors and geographies constructed by the Filer's experienced investment professionals.
31. A Top Fund's investment in an RBC Private Market Fund will be disclosed to investors in that Top Fund's quarterly portfolio holding reports, financial statements and fund facts or ETF facts documents, as applicable.
32. Where an investment is made by a Top Fund in an RBC Private Market Fund, the annual and interim management reports of fund performance for the Top Fund will disclose the name of the related person in which an investment is made, being an RBC Private Market Fund.
33. Where an investment is made by a Top Fund in an RBC Private Market Fund, the records of portfolio transactions maintained by the Top Fund will include, separately for every portfolio transaction effected for the Top Fund by the Filer or through any affiliate of the Filer, the name of the related person in which an investment is made, being an RBC Private Market Fund.
34. Investments in the RBC Private Market Funds are considered illiquid investments under NI 81-102 and are therefore included as part of the calculation for the purposes of the illiquid asset restriction in section 2.4 of NI 81-102 for the Top Funds. Furthermore, the Filer has its own liquidity policy and manages, or will manage, the Top Funds' liquidity prudently under these policies.
35. The manager of the Top Funds will request approval from the IRC of the Top Funds to permit the investment of the Top Funds in the RBC Private Market Funds, including by way of standing instructions. No such investments will be made by a Top Fund until the IRC of the Top Fund provides its approvals under section 5.2 of NI 81-107. The manager of the Top Funds will comply with section 5.1 of NI 81-107 and section 5.4 of NI 81-107 for any standing instructions the IRC provides in connection with the investment by a Top Fund in one or more RBC Private Market Funds. If the IRC becomes aware of an instance where the manager of the Top Fund did not comply with the terms of any decision evidencing the Exemption Sought, or a condition imposed by securities legislation or the IRC in its approval, the IRC of the Top Fund will, as soon as practicable, notify in writing the securities regulatory authority or regulator in the Jurisdiction under which the Top Fund is organized.
36. Investments by a Top Fund in the RBC Private Market Funds do not, or will not, qualify for the exemption from the Control Restriction in paragraph 2.2(1.1)(a) of NI 81-102 as the RBC Private Market Funds are not, or will not be, "investment funds" subject to NI 81-102.
37. A partner, director, officer or employee of a portfolio manager of a Top Fund, or a partner, director, officer or employee of an associate or an affiliate of a portfolio manager of a Top Fund, may also be a partner, director or officer of an RBC Private Market Fund. Consequently, as a Top Fund may be a "dealer managed investment fund", the restrictions in subsection 4.1(2) of NI 81-102 may apply to an investment by a Top Fund in an RBC Private Market Fund.
38. Since the RBC Private Market Funds are not reporting issuers subject to NI 81-102 and are not "investment funds" pursuant to the Legislation, the Top Funds are unable to rely on the codified exemptions from the Investment Fund Conflict of Interest Investment Restrictions and Investment Fund Conflict of Interest Reporting Requirement in subsections 2.5(7) and 2.5.1(2) of NI 81-102 for investments by public and private investment funds in securities of other investment funds.
39. Subsection 6.2(3) of NI 81-107 provides an exemption for investment funds (including investment funds that are not reporting issuers) from the Investment Fund Conflict of Interest Investment Restrictions for purchases of related issuer securities if the purchase is made on an exchange. However, the exemption in subsection 6.2(3) of NI 81-107 does not apply to purchases of non-exchange-traded securities and therefore does not apply to purchases of securities of an RBC Private Market Fund by a Top Fund.
40. Each Public Top Fund that is a "dealer managed investment fund" would be prohibited by the Investment Fund Conflict of Interest Investment Restrictions from knowingly making an investment in an RBC Private Market Fund in which any partner, director, officer or employee of the Public Top Fund's management company or an affiliate or associate of the Public Top Fund's management company is a partner, director or officer.
41. The Filer or an affiliate of the Filer acting as portfolio manager of a Top Fund would be prohibited by the Investment Fund Conflict of Interest Investment Restrictions from causing the Top Fund to invest in securities of an RBC Private Market Fund without disclosing this fact and obtaining the written consent of each investor in the Top Fund before the purchase.
42. The Filer, or an affiliate of the Filer acting as the management company (as defined in the Act) of the Public Top Funds would be required by the Investment Fund Conflict of Interest Reporting Requirement to file a report of every transaction of purchase or sale of securities between the Public Top Funds and an RBC Private Market Fund within 30 days after the end of the month in which such purchase or sale occurs.
43. It would be costly and time-consuming for the Public Top Funds to comply with the Investment Fund Conflict of Interest Reporting Requirement.
44. A Top Fund's investment in an RBC Private Market Fund will represent the business judgment of a responsible person uninfluenced by considerations other than the best interests of the Top Fund.
45. The Filer believes that granting the Requested Relief is in the best interests of the Top Funds as it would provide the Top Funds with more flexibility to increase their allocation to the private markets.
46. The Control Relief was previously granted to the Filer, on the terms and conditions provided for in the Current Relief. The Filer wishes to revoke the Current Relief and replace it with this decision in order to (a) expand the definition of Top Funds to include additional investment funds that are, or will be, managed by the Filer or an affiliate, (b) include the additional relief outlined in paragraphs (a), (c), (d) and (e) under the subheading "Background" above and (c) update the conditions relating to the Control Relief to align with the terms and conditions contained in similar relief which has more recently granted by the OSC.
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that:
(a) the Revocation is granted; and
(b) the Requested Relief is granted provided that:
(i) no Top Fund is actively participating or will actively participate in the business or operations of any RBC Private Market Fund;
(ii) the securities of an RBC Private Market Fund purchased and held by a Top Fund will be non-voting and will not to provide the Top Fund with any right to (a) appoint directors or observers to any board of the RBC Private Market Fund or its manager, (b) restrict management of the RBC Private Market Fund or be involved in the decision-making with respect to the investments made by the RBC Private Market Fund or (c) restrict the transfer of securities of the RBC Private Market Fund by other investors in the RBC Private Market Fund;
(iii) no Top Fund will have any (a) look-through rights with respect to the individual portfolio investments held by an RBC Private Market Fund or (b) rights to, or responsibility for, administering any of the portfolio investments held by an RBC Private Market Fund;
(iv) each Top Fund is, or will be, treated as an arm's-length investor in each RBC Private Market Fund in which it invests, on the same terms as all other third-party investors;
(v) where an investment is made by a Top Fund in an RBC Private Market Fund, the records of portfolio transactions maintained by the Top Fund include, separately for every portfolio transaction effected for a Top Fund by the Filer or through any affiliate of the Filer, the name of the related person in which an investment is made, being the RBC Private Market Fund;
(vi) investments in the RBC Private Market Funds are considered illiquid investments under NI 81-102 and therefore are not permitted to exceed, in aggregate, 10% of the net asset value of the Top Fund;
(vii) in respect of an investment by a Top Fund in an RBC Private Market Fund, no sales or redemption fees are, or will be, paid as part of the investment in the RBC Private Market Fund;
(viii) in respect of an investment by a Top Fund in an RBC Private Market Fund, no management fees or incentive fees are, or will be, payable by the Top Fund that, to a reasonable person, would duplicate a fee payable by an RBC Private Market Fund for the same service;
(ix) a Top Fund's investment in an RBC Private Market Fund is, or will be, disclosed to investors in the Top Fund's quarterly portfolio holdings reports, financial statements and fund facts or ETF facts documents, as applicable;
(x) the IRC of each of the Public Top Funds will review and provide its approval, including by way of standing instructions, prior to the purchase of securities of an RBC Private Market Fund, directly or indirectly, by the Public Top Fund, in accordance with subsection 5.2(2) of NI 81-107;
(xi) the manager of each of the Top Funds complies with section 5.1 of NI 81-107 and the manager and the IRC of the Top Funds will comply with section 5.4 of NI 81-107 for any possible standing instructions concerning an investment by a Top Fund in an RBC Private Market Fund;
(xii) if the IRC becomes aware of an instance where the Filer or an affiliate of the Filer, in its capacity as the manager of a Public Top Fund, did not comply with the terms of this decision, or a condition imposed by securities legislation or the IRC in its approval, the IRC of the Public Top Fund will, as soon as practicable, notify in writing the securities regulatory authority or regulator in the Jurisdiction under which the Public Top Fund is organized;
(xiii) where an investment is made by a Top Fund in an RBC Private Market Fund, the annual and interim management reports of fund performance for the Top Fund will disclose the name of the related person in which an investment is made, being an RBC Private Market Fund;
(xiv) a Top Fund will not invest in an RBC Private Market Fund unless the net asset value of the RBC Private Market Fund is based on a valuation of portfolio assets of the RBC Private Market Fund that are (A) appraised and/or verified by an independent third-party at least once every 12 months (the "Alternative Valuation Model") or (B) independently determined or verified by an arm's length third party as at each valuation date, and in both instances, the RBC Private Market Fund produces annual financial statements that are audited by a qualified auditing firm in accordance with generally accepted accounting principles and made available to the Top Fund;
(xv) total capital contributed to an RBC Private Market Fund that determines its net asset value based on the Alternative Valuation Model, by a Top Fund, collectively with related investment funds and affiliates or associates of the Filer, does not represent, as at the time of investment, more than 50% of all contributed capital to the RBC Private Market Fund, if the RBC Private Market Fund is structured as a limited partnership or 50% of all outstanding units or shares of the RBC Private Market Fund if the RBC Private Market Fund is structured as a trust or a corporation, as applicable; and
(xvi) the Prospectus of a Top Fund discloses, or will disclose, in the next renewal or amendment thereto following the date of this decision, the fact that the Top Fund may invest in one or more RBC Private Market Funds, which are investment vehicles managed by the Filer or an affiliate, the potential conflict of interest that arises from these investments and how it is mitigated or avoided, and the approximate or maximum percentage of the net asset value of the Top Fund that is intended to be invested in securities of the RBC Private Market Funds.
Application File #: 2025/0453
SEDAR+ File #:6311541
Mackenzie Financial Corporation et al.
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Relief from conflict-of-interest provisions in section 111 of the Securities Act to permit investments by public investment funds into related underlying investments that are not reporting issuers -- relief also granted from related party transaction reporting requirements in section 117 of the Securities Act -- subject to conditions.
Securities Act, R.S.O. 1990, c. S.5, ss. 111(2)(c), 111(4), and 113 and 117.
November 19, 2025
The principal regulator in the Jurisdiction has received an application from the Filers for a decision under the securities legislation of the Jurisdiction (the Legislation) granting an exemption to certain investment funds which are subject to National Instrument 81-102 Investment Funds (NI 81-102), including the iProfile Canadian Equity Private Pool (the Pool) and any other additional mutual funds and non-redeemable investment funds currently managed by the Filers that are subject to NI 81-102, (together with the Pool, the Existing Investment Funds) and any additional mutual funds and non-redeemable investment funds established in the future of which a Filer is the manager (together with the Existing Investment Funds, the Investment Funds, each, anInvestment Fund), from the following provisions, to invest in the Power Sustainable Funds (defined below):
(a) Paragraph 111(2)(c)(ii) and subsection 111(4) of the Securities Act (Ontario) (the Act), which prohibit an Investment Fund from knowingly making or holding an investment in an issuer in which a substantial security holder of the Investment Fund, its management company, or its distribution company, has a significant interest (the Related Issuer Investment Restriction); and
(b) Subsection 117(1) of the Act, which require a management company to file a report within 30 days after the month end of (i) every transaction of purchase or sale of securities between an Investment Fund and any related person or company, and (ii) every transaction in which an Investment Fund is a joint participant with one or more related persons or companies (the Management Company Reporting Requirement)
(collectively, the Requested Relief).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for the application; and
(b) the Filers have provided notice that subsection 4.7(1)(c) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in British Columbia, Alberta, Saskatchewan, Nova Scotia, New Brunswick, and Newfoundland and Labrador (together with the Jurisdiction, the Jurisdictions).
Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision unless otherwise defined.
This decision is based on the following facts represented by the Filer:
Mackenzie
1. Mackenzie Financial Corporation (Mackenzie) is a corporation formed under the laws of Ontario. It is the trustee, manager, and portfolio adviser of certain Existing Investment Funds.
2. Mackenzie is registered as a portfolio manager, investment fund manager, exempt market dealer and commodity trading manager in Ontario. Mackenzie is registered as a portfolio manager, investment fund manager and exempt market dealer in Quebec and Newfoundland and Labrador. Mackenzie is also registered as a portfolio manager and exempt market dealer in Alberta, British Columbia, Manitoba, New Brunswick, Northwest Territories, Nova Scotia, Nunavut, Prince Edward Island, Saskatchewan, and Yukon.
3. Neither Mackenzie nor any of the Existing Investment Funds of which it is the investment fund manager are in default of any of the requirements of securities legislation of any of the Jurisdictions.
4. Mackenzie is an indirect, wholly owned subsidiary of IGM Financial Inc. (IGM). Power Corporation of Canada (Power) owns approximately 66% of the voting securities of IGM. Power, therefore, is a "substantial security holder" of Mackenzie as defined under the Act.
IGIM
5. I.G. Investment Management Inc. (IGIM) is a corporation continued under the laws of Ontario. It is the trustee, portfolio adviser, and manager of certain Existing Investment Funds, including the Pool.
6. IGIM is registered as a portfolio manager and investment fund manager in Manitoba, Ontario, Quebec, and Newfoundland and Labrador and as a portfolio manager in British Columbia, Alberta, Saskatchewan, New Brunswick, Nova Scotia, Prince Edward Island, the Northwest Territories, Nunavut, and Yukon.
7. Neither IGIM nor any of the Investment Funds are in default of any of the requirements of securities legislation in any of the Jurisdictions.
8. IGIM is an indirect, wholly owned subsidiary of IGM. Power, therefore, is a "substantial security holder" of IGIM under the Act.
9. Information barriers have been implemented between Mackenzie and IGIM and between them, Power and Power's subsidiaries.
The Investment Funds
10. Each of the Investment Funds is, or will be, a mutual fund or non-redeemable investment fund subject to NI 81-102 and is a reporting issuer in each of the Jurisdictions. Any Investment Funds established in the future will be subject to NI 81-102 and will be a reporting issuer in at least one of the Jurisdictions.
11. Each of the Existing Investment Funds currently distributes its securities under a prospectus prepared in accordance with National Instrument 81-101 Mutual Fund Prospectus Disclosure ("NI 81-101") or National Instrument 41-101 General Prospectus Requirements ("NI 41-101"). Any Investment Funds established in the future will distribute securities under a prospectus prepared in accordance with NI 81-101 or NI 41-101.
12. One of the Filers, or an affiliate, will be the manager of any Investment Funds established in the future and will, therefore, be the management company of the Investment Fund under the Act.
Power Sustainable
13. Power Sustainable Manager Inc. (together with its subsidiaries, Power Sustainable) is a subsidiary of Power. Power's direct or indirect ownership interest of its subsidiaries is referred to as the Power Ownership Percentage of the applicable subsidiary in this Decision. As such, Power is deemed to own beneficially an amount equal to the Power Ownership Percentage of any voting securities owned by Power Sustainable pursuant to the Act.
14. Power Sustainable is a sustainability focused multi-platform alternative asset manager, whose platforms invest in private equity, energy infrastructure projects, and infrastructure credit assets. As of June 30, 2025, Power Sustainable had C$4 billion of assets under management, including unfunded commitments.
15. Power maintains formal information barriers among its subsidiaries and affiliates including IGM, and Power and, therefore, Power Sustainable operate independently of IGM.
PSEIF II
16. Power Sustainable Energy Infrastructure Fund II (PSEIF II) will be a closed-end fund consisting of one or more limited partnerships formed under the laws of Quebec (or other jurisdictions) managed by Power Sustainable. PSEIF II's investment objective is to generate capital appreciation and yield primarily through core-plus/value added equity investments in infrastructure projects (development, construction and operating-stage) and businesses in the following sectors: renewables, energy storage, distributed energy solutions, transmission, renewable fuels, EV infrastructure, and other low carbon infrastructure assets and businesses.
17. PSEIF II is not an "investment fund" for purposes of the Act because, among other things, certain investments made by PSEIF II will represent control positions in underlying companies. Furthermore, PSEIF II will be actively involved in the management of the businesses or assets in which it invests.
18. PSEIF II is expected to have a term of 10 years from the date of final closing, plus a one-year extension at Power Sustainable's discretion and an additional one-year extension with the approval of the advisory committee. PSEIF II's initial closing (the Initial Closing Date) is expected to take place during calendar year 2026. PSEIF II is expected to accept subscriptions for new capital commitments within a period of 18 months following the Initial Closing Date, which may be extended up to 6 months at Power Sustainable's discretion (the Final Closing Date).
19. PSEIF II is expected to be able to draw capital from its investors up to the amount of their capital commitment for up to 5 years following the Initial Closing Date, subject to a one-year extension at Power Sustainable's discretion and an additional one-year extension with the approval of the advisory committee.
The Other Power Sustainable Funds
20. In addition to PSEIF II, Power Sustainable manages other private market funds across asset classes including: infrastructure equity (Power Sustainable Private Equity Infrastructure Funds), agri-food and decarbonatization private equity (Power Sustainable Private Equity Funds), and infrastructure private credit (Power Sustainable Private Credit Funds, and, together with the Power Sustainable Private Equity Infrastructure Funds and the Power Sustainable Private Equity Funds, the Power Sustainable Funds).
21. Similar to PSEIF II, the Power Sustainable Funds are not "investment funds" for purposes of the Act. Power Sustainable Private Equity Funds or Power Sustainable Private Equity Infrastructure Funds, like PSEIF II, are not investment funds due to the nature of investment strategy as active investors engaged with management of portfolio company investments and/or infrastructure assets, respectively. The Power Sustainable Private Credit Funds do not invest in a portfolio of securities. Rather, they originate and administer private loans. Once an investment is disposed of by the Power Sustainable Fund, the Power Sustainable Fund typically distributes the proceeds to its investors; however, subject to the Power Sustainable Fund's recycling provisions, such proceeds may in certain instances be re-invested.
Reason for Requested Relief
22. The Pool seeks to invest in PSEIF II consistent with its investment objectives.
23. From time to time, the Investment Funds may, if consistent with their investment objectives and strategies, wish to invest in a Power Sustainable Fund.
24. Power, through one or more affiliates, has not yet made an investment in PSEIF II. However, Power and its affiliates may proceed with an investment in PSEIF II that may lead to the Power Ownership Percentage of PSEIF II exceeding 10% of PSEIF II's aggregate committed capital. This would result in Power and its affiliates, where applicable, having a "significant interest" in PSEIF II under the Act. PSEIF II would also be considered a "related person or company" to the Investment Funds under the Act.
25. Power, through Power Sustainable or other affiliates, may also commit capital to investing in a Power Sustainable Fund. If such investment exceeds 10% of the committed capital of the applicable Power Sustainable Fund, Power would be considered to have a significant interest in the Power Sustainable Fund under the Act.
26. Since Power is a substantial security holder of each of the Filers, then absent the Requested Relief, the Related Issuer Investment Restriction would prohibit the Pool from investing in PSEIF II, or continuing to invest in PSEIF II, and the Investment Funds would be prohibited from investing in the Power Sustainable Funds.
27. Absent the Requested Relief, the Management Company Reporting Requirement would require the Filers to file a report of (i) every transaction of purchase or sale of securities between an Investment Fund and a Power Sustainable Fund, and (ii) every transaction in which an Investment Fund is a joint participant with one or more Power Sustainable Funds, within 30 days of the month end in which the transaction occurred.
Generally
28. An investment by an Investment Fund in a Power Sustainable Fund will be consistent with its investment objectives.
29. An investment by an Investment Fund will be in an amount that constitutes less than 10% of all capital commitments to the Power Sustainable Fund.
30. The aggregate investment by Investment Funds managed by Mackenzie, collectively, in a Power Sustainable Fund will be in an amount that constitutes less than 20% of all capital commitments to that Power Sustainable Fund. Similarly, the aggregate investment by Investment Funds managed by IGIM, collectively, in a Power Sustainable Fund will respectively be in an amount that constitutes less than 20% of all capital commitments to that Power Sustainable Fund.
31. Securities of the Power Sustainable Funds are considered "illiquid assets" under NI 81-102 and, therefore, an Investment Fund will not invest more than the limit on such investment as set forth in NI 81-102, or as may otherwise be permitted through exemptive relief.
32. The Pool's independent review committee (IRC) established under National Instrument 81-107 Independent Review Committee for Investment Funds (NI 81-107) has not yet reviewed the proposed investment by the Pool in PSEIF II pursuant to subsection 5.3(1) of NI 81-107. If the Requested Relief is granted, approval from the IRC pursuant to clause 5.2(1)(b) of NI 81-107 will be sought, including by way of standing instructions, prior to making an investment in PSEIF II.
33. Any proposed investment by an Investment Fund in a Power Sustainable Fund will be reviewed by, and subject to the approval of, the Investment Fund's IRC, including by way of standing instructions, prior to the Investment Fund committing to the investment.
34. The Filers believe that a meaningful allocation to private infrastructure assets provides the Pool's investors with unique diversification opportunities and represents an appropriate investment tool for the Pool that has not been widely available in the past. Private infrastructure investments have historically performed well in down markets; the Filers believe that permitting the Pool to gain exposure to private infrastructure, a subset of alternative investments, offer the potential to improve the Pool's performance while reducing its risk and volatility. Granting the Requested Relief would allow the Pool's investors to benefit from access to a larger allocation to the private asset class, helping the Pool and its investors meet their investment objectives.
35. The Filers believe that an investment in PSEIF II is in the best interests of the Pool. They note that Power Sustainable has a strong team, history and depth of analysis. Power Sustainable is able to source deals and access differentiated opportunity sets in niche areas of the market that are not otherwise available to the Filers. Infrastructure is an attractive asset class, offering stable cash flows, inflation protection, and downside resilience, with investments supported by robust contractual frameworks and strong underlying fundamentals.
36. Pursuant to National Instrument 81-106 Investment Fund Continuous Disclosure (NI 81-106), each Investment Fund prepares and files interim and annual management reports of fund performance (MRFPs) that disclose any transactions involving a related party, including the identity of that related party, the relationship to the Investment Fund, the purpose of the transaction, the measurement basis used to determine the recorded amount, and any ongoing commitments to the related party.
37. It is costly and time consuming for the Filers to also provide the reporting required by the Management Company Reporting Requirement, which is substantially similar to the information required by NI 81-106 to be disclosed in the MRFPs.
38. An investment in a Power Sustainable Fund represents the business judgment of the portfolio manager of the Investment Fund uninfluenced by considerations other than the best interests of the Investment Fund.
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Requested Relief is granted, provided that:
(a) The purchase or holding of a Power Sustainable Fund is consistent with, or necessary to meet, the investment objectives of an Investment Fund;
(b) The investments in the Power Sustainable Funds are made on market terms and conditions that are the same as those offered to other third-party investors, ensuring no preferential treatment or undue influence from the substantial security holder;
(c) The aggregate investment by Investment Funds managed by Mackenzie, collectively, in a Power Sustainable Fund will be in an amount that constitutes less than 20% of all capital commitments to that Power Sustainable Fund. Similarly, the aggregate investment by Investment Funds managed by IGIM, collectively, in a Power Sustainable Fund, will respectively be in an amount that constitutes less than 20% of all capital commitments to that Power Sustainable Fund;
(d) Securities of the Power Sustainable Funds are considered "illiquid assets" under NI 81-102 and, therefore, an Investment Fund will not invest more than the limit on such investment as set forth in NI 81-102, or as may otherwise be permitted through exemptive relief;
(e) At the time of entering into any commitment of capital to a Power Sustainable Fund, the IRC of the Investment Fund has approved the transaction in accordance with subsection 5.2(2) of NI 81-107;
(f) Each Filer, as the investment fund manager of an Investment Fund, complies with section 5.1 of NI 81-107 and the Filer and the IRC comply with section 5.4 of NI 81-107 for any standing instructions the IRC provides in connection with the Investment Fund's transactions in securities of a Power Sustainable Fund; and
(g) No later than the time the Investment Fund files its annual financial statements, and no later than the 90th day after the end of each financial year of the Investment Fund, the Filers file with the securities regulatory authority or regulator the particulars of any investments made in reliance on the Requested Relief.
Ontario Securities Commission
Application File #: 2025/0614
AGF Investments Inc. and The Top Funds
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Relief from conflict of interest investment restrictions and management company reporting requirements in ss.111(2) and 111(4) of the Securities Act (Ontario), the self-dealing restriction in s. 13.5(2)(a) of NI 31-103, and the fund-on-fund investment requirements of paragraphs 2.5(2)(a), (b), and (c) of NI 81-102, to permit investment funds that are reporting issuers to invest in related underlying investment funds and collective investment schemes that are not reporting issuers -- Relief subject to conditions, including that investment by a Top Fund in securities of an underlying investment fund be included as part of the calculation for the purposes of the 10% illiquid asset restriction in s. 2.4 of NI 81-102, and that the independent review committee of a Top Fund review and provide its approval to the purchase of securities of a related underlying investment fund.
Securities Act, R.S.O. 1990, c. S.5, as am., ss. 111(2)(b), 111(2)(c)(i) and (ii), and 111(4).
National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations, ss. 13.5(2)(a) and 15.1.
National Instrument 81-102 Investment Funds, ss. 2.5(2)(a), 2.5(2)(b), and 2.5(2)(c).
December 12, 2025
The principal regulator in the Jurisdiction has received an application (the Application) from AGF Investments Inc. (AGFI) and its affiliates (AGFI, together with its affiliated registered investment fund managers and/or affiliated registered portfolio managers, as applicable, the Filer) on their behalf and on behalf of investment funds managed by the Filer that are reporting issuers subject to National Instrument 81-102 Investment Funds (NI 81-102) and National Instrument 81-107 Independent Review Committee for Investment Funds (NI 81-107) (the Existing Public Top Funds) and investment funds managed by the Filer that are not reporting issuers subject to NI 81-102 and NI 81-107 (the Existing Private Top Funds, together with the Existing Public Top Funds, the Existing Top Funds) and any future investment fund managed by the Filer that is, or will be, a reporting issuer and that is subject to NI 81-102 and NI 81-107 (the Future Public Top Funds, and together with the Existing Public Top Funds, the Public Top Funds) or is not, or will not be, a reporting issuer subject to NI 81-102 and NI 81-107 (the Future Private Top Funds, together with the Existing Private Top Funds, the Private Top Funds, and the Private Top Funds together with the Public Top Funds, the Top Funds) for a decision under the securities legislation of the Jurisdiction (the Legislation), with respect to a Top Fund investing a portion of its assets in AGF NHC Tactical Alpha Fund (the Canadian Feeder Trust), which is an investment fund managed by AGFI:
1. Exempting the Public Top Funds from the following prohibitions in NI 81-102:
(a) section 2.5(2)(a) of NI 81-102, which prohibits an investment fund from purchasing or holding a security of another investment fund unless, if the investment fund is a mutual fund, other than an alternative mutual fund, either of the following applies:
(i) the other investment fund is a mutual fund, other than an alternative mutual fund, that is subject to NI 81-102;
(ii) the other investment fund is an alternative mutual fund or a non-redeemable investment fund that is subject to NI 81-102 and, at the time of the purchase of that security, the investment fund holds no more than 10% of its net asset value (NAV) in securities of alternative mutual funds and non-redeemable investment funds;
(b) section 2.5(2)(b) of NI 81-102, which prohibits an investment fund from purchasing or holding a security of another investment fund unless at the time of the purchase of that security, the other investment fund holds no more than 10% of its NAV in securities of other investment funds;
(c) section 2.5(2)(c) of NI 81-102, which prohibits an investment fund from purchasing or holding a security of another investment fund unless the other investment fund is a reporting issuer in a jurisdiction
(collectively, the NI 81-102 Relief);
2. Exempting the Private Top Funds from the following restriction in the Securities Act (Ontario):
(a) Paragraph 111(2)(b), which prohibits an investment fund from knowingly making an investment in a person or company in which the investment fund, alone or together with one or more related investment funds, is a substantial security holder;
(b) Paragraph 111(2)(c), which prohibits an investment fund from knowingly making an investment in an issuer in which any of the following has a significant interest:
(i) any officer or director of the investment fund, its management company or distribution company or an associate of any of them; or
(ii) any person or company who is a substantial security holder of the investment fund, its management company or its distribution company; and
(c) Paragraph 111(4), which prohibits an investment fund, its management company or its distribution company from knowingly holding an investment described in paragraph (a) or (b) above
(collectively, the Related Issuer Relief); and
3. Exempting the Filer, with respect to the Private Top Funds investing in the Canadian Feeder Trust, from the restriction in paragraph 13.5(2)(a) of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103) that prohibits a registered adviser from knowingly causing an investment portfolio managed by it, including an investment fund for which it acts as adviser, to invest in securities of any issuer in which a responsible person or an associate of a responsible person is a partner, officer or director, unless the fact is disclosed to the client and the written consent of the client to the investment is obtained before the purchase (the Consent Relief).
The NI 81-102 Relief, Related Issuer Relief and Consent Relief are collectively referred to as the Exemption Sought.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for the Application; and
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in Alberta, British Columbia, Manitoba, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, Nunavut, Québec, Prince Edward Island, Saskatchewan and Yukon (together with Ontario, the Jurisdictions).
Terms defined in National Instrument 14-101 Definitions (NI 14-101), MI 11-102, NI 81-102 and NI 81-107 have the same meaning if used in this decision, unless otherwise defined.
The Filer and New Holland Capital LLC (NHC)
1. AGFI is a corporation amalgamated under the laws of the Province of Ontario, with its head office located in Toronto, Ontario. AGFI and its affiliates are each directly or indirectly wholly owned by AGF Management Limited.
2. AGFI is registered in the categories of (a) exempt market dealer in the Provinces of Alberta, British Columbia, Manitoba, Ontario, Quebec and Saskatchewan, (b) portfolio manager in each of the provinces and territories of Canada, (c) investment fund manager in the Provinces of Alberta, British Columbia, Newfoundland and Labrador, Ontario and Quebec, and (d) commodity trading manager in the Province of Ontario.
3. AGFI is the manager of the Existing Top Funds.
4. AGFI or an affiliate of AGFI will be the manager or portfolio manager of any Future Public Top Funds and any Future Private Top Funds (together, the Future Top Funds). To the extent that AGFI or an affiliate of AGFI is the manager or portfolio manager of any Future Top Fund, the representations set out in this decision will apply to the same extent to such Future Top Fund and AGFI or its affiliates.
5. AGFI is the manager and trustee of the Canadian Feeder Trust, a fund that achieves its investment objective by investing substantially all of its investable assets in New Holland Tactical Alpha Offshore Fund Ltd., a Cayman Islands exempted company (the Cayman Feeder Fund), which in turn invests substantially all of its investable assets in New Holland Tactical Alpha Master Fund LP, a Cayman Islands exempted limited partnership (the Cayman Master Fund). The Cayman Master Fund currently invests all of its investable assets in the New Holland Tactical Alpha Fund LP (the Trading Fund), which acts as the main trading vehicle of the underlying fund structure.
6. NHC is a Delaware limited liability company and is the manager of the Cayman Feeder Fund, the Cayman Master Fund, and the Trading Fund.
7. NHC is registered with the U.S. Securities and Exchange Commission as an investment adviser under the U.S. Investment Advisers Act of 1940, as amended.
8. The Filer and its affiliates are not currently affiliates or associates of NHC, but an affiliate of the Filer holds an indirect economic interest in NHC which is convertible into equity securities representing up to a 67% indirect ownership interest in NHC.
9. No officers or directors of the Filer serve as officers or directors of NHC. Ken Tsang and Ashley Lawrence, both of whom are officers of the Filer, currently serve as members of the board of managers of NHC Intermediate Partners LLC, the parent company of NHC. However, neither Mr. Tsang nor Mr. Lawrence holds any voting rights in such capacity, as voting rights are tied to ownership interests, and the Filer's affiliate presently holds no equity interest in NHC Intermediate Partners LLC.
10. AGFI and any of its affiliates who intend to rely on a decision in respect of the Exemption Sought, if granted, are currently registered as investment fund managers and/or portfolio managers for any of the Existing Top Funds and are not in default of securities legislation in any Jurisdiction.
The Public Top Funds
11. A Public Top Fund is or will be an investment fund to which NI 81-102 applies subject to any exemptions therefrom that have been or may be granted by securities regulatory authorities.
12. Each Public Top Fund is, or will be, a reporting issuer under the securities legislation of one or more Jurisdictions.
13. The securities of each of the Public Top Funds are, or will be, qualified for distribution in one or more of the Jurisdictions and distributed to investors pursuant to a prospectus prepared in accordance with National Instrument 81-101 Mutual Fund Prospectus Disclosure.
14. Each Public Top Fund may wish to invest in securities of the Canadian Feeder Trust, provided the investment is consistent with the Public Top Fund's investment objectives and strategies.
15. Each Public Top Fund is, or will be, valued and redeemable daily.
16. Each Public Top Fund is subject to NI 81-107 and the Filer has established an independent review committee (IRC) in order to review conflict of interest matters pertaining to its management of the Public Top Funds as required by NI 81-107.
17. None of the Existing Public Top Funds is in default of securities legislation in any of the Jurisdictions.
The Private Top Funds
18. Each Private Top Fund is an investment fund as defined in securities legislation.
19. None of the Private Top Funds is, or will be, a reporting issuer under the securities legislation of any Jurisdiction, nor generally subject to NI 81-102.
20. The securities of each Private Top Fund are, or will be, distributed solely to investors pursuant to exemptions from the prospectus requirements in accordance with National Instrument 45-106 Prospectus Exemptions (NI 45-106) and the securities legislation of one or more Jurisdictions.
21. Each Private Top Fund has, or will have, an offering memorandum, investment product sheet or statement of investment policies and guidelines, which is provided to investors (the Offering Document).
22. Each Private Top Fund may wish to invest in securities of the Canadian Feeder Trust, provided the investment is consistent with the Private Top Fund's investment objectives and strategies.
23. Each Private Top Fund is, or will be, valued daily or at least weekly, and redeemable daily subject to notice provisions as applicable.
24. None of the Existing Private Top Funds is in default of securities legislation in any of the Jurisdictions.
The Canadian Feeder Trust
25. The Canadian Feeder Trust is an open-ended trust formed under the laws of the Province of Ontario pursuant to and governed by a master declaration of trust dated January 15, 2025, as may be further amended from time to time.
26. The Canadian Feeder Trust has been formed to invest substantially all of its investable assets, directly or indirectly, in the Cayman Feeder Fund managed by NHC.
27. The Canadian Feeder Trust's investment objective is to generate attractive risk-adjusted returns across market regimes while maintaining low beta to traditional asset classes.
28. The Canadian Feeder Trust is a not a reporting issuer in any jurisdiction of Canada.
29. Securities of the Canadian Feeder Trust are distributed solely to investors pursuant to exemptions from the prospectus requirements in accordance with NI 45-106 or the Legislation, as applicable.
30. The Canadian Feeder Trust has an Offering Document which is provided to investors.
31. The Canadian Feeder Trust is an "investment fund" as such term is defined under Canadian securities legislation.
32. Securities of the Canadian Feeder Trust are valued monthly, and redeemable monthly at a redemption price equal to the NAV per unit on the applicable redemption date, although redemptions may be subject to lock-up periods, early redemption penalties, and limitations on redemptions. The Canadian Feeder Trust may redeem fewer units for cash than have been requested to be redeemed from the Canadian Feeder Trust on any redemption date to the extent the Canadian Feeder Trust has received redemption requests aggregating to 6% or more of its NAV. In such case, the affected units will be redeemed at a redemption price per unit equal to 95% of the NAV per unit as at the applicable redemption date and such redemption price shall be paid in redemption notes. Unitholders have the option to instruct the Canadian Feeder Trust not to deliver redemption notes to satisfy the payment of proceeds of redemption by indicating in the redemption notice that such unitholder wishes to retract all or the portion of the redemption notice that would have been satisfied through the issuance of redemption notes. Redemption notes means unsecured subordinated promissory notes in a principal amount equal to 95% of the applicable NAV per unit as at the applicable redemption date, times the number of units subject to any redemption restrictions, bearing interest at a market rate determined by the Filer, having a maturity date to be determined by the Filer up to a maximum of 5 years from the date of issuance of the redemption note, and payable monthly with no restrictions on prepayment. Accordingly, the securities of the Canadian Feeder Trust are generally considered "illiquid assets" within the meaning of NI 81-102 for being restricted securities.
33. The Canadian Feeder Trust is not in default of the securities legislation of any Jurisdiction.
34. No Top Fund will actively participate in the business or operations of the Canadian Feeder Trust.
The Cayman Feeder Fund
35. The Cayman Feeder Fund is an exempted company incorporated under the provisions of the Companies Act (As Revised) of the Cayman Islands on May 19, 2022. The Cayman Feeder Fund is managed by NHC.
36. The Cayman Feeder Fund has been formed to invest substantially all of its investable assets, directly or indirectly, in the Cayman Master Fund, managed by NHC.
37. The investment objective of the Cayman Feeder Fund is to develop and actively manage a leveraged investment portfolio that is intended to produce attractive risk-adjusted returns with low beta to traditional asset classes.
38. The Cayman Feeder Fund is not a reporting issuer in any jurisdiction of Canada.
39. To the extent securities of the Cayman Feeder Fund are sold to Canadian investors, including the Canadian Feeder Trust, securities of the Cayman Feeder Fund will be distributed solely pursuant to exemptions from the prospectus requirements in accordance with NI 45-106 or the Legislation, as applicable.
40. The Cayman Feeder Fund is an "investment fund" as such term is defined under Canadian securities legislation.
41. The Cayman Feeder Fund is not in default of the securities legislation of any Jurisdiction.
42. No Top Fund nor the Canadian Feeder Trust will actively participate in the business or operations of the Cayman Feeder Fund.
The Cayman Master Fund and the Trading Fund
43. The Cayman Master Fund is an exempted limited partnership registered under the Exempted Limited Partnership Act (As Revised) of the Cayman Islands on May 19, 2022. The Cayman Master Fund is managed by NHC.
44. The investment objective of the Cayman Master Fund is to develop and actively manage a leveraged investment portfolio that is intended to produce attractive risk-adjusted returns with low beta to traditional asset classes.
45. The Cayman Master Fund directly or indirectly allocates its assets among a select group of trading advisors or investment managers, which will invest or trade in a wide range of securities and other instruments (including equities and fixed income securities, structured products, currencies, commodities, futures contracts, options and other derivatives, listed or unlisted, rated or unrated), generally through separate managed accounts or similar arrangements, and, where determined by NHC to be in the best interest of the Caymen Master Fund, in commingled pooled investment vehicles advised by trading advisors. Some of such trading advisors and investment managers may be controlled by or under common control with NHC or the Filer.
46. The Cayman Master Fund currently invests all of its investable assets in the Trading Fund. The Trading Fund invests or trades in a wide range of securities and other instruments (including, but not limited to, equities and fixed income securities, structured products, currencies, commodities, futures contracts, options and other derivative instruments which may be listed or unlisted and rated or unrated) generally through separately managed accounts or similar arrangements. The Trading Fund is expected to develop new types of investment strategies, and is expected to seek to capitalize on attractive opportunities as markets change, wherever they might be. Therefore, the full range of instruments, industries, contracts and markets in which the Trading Fund will take positions over time cannot be specified with precision, but may include, without limitation, strategies such as: arbitrage and event; quantitative equity; quantitative macro; commodities; equity long/short; trend following; credit relative value; fixed income relative value; and other special situations. The Trading Fund holds investments directly or through wholly-owned subsidiaries established for tax, regulatory, or risk management purposes.
47. The Trading Fund is a Cayman Islands exempted limited partnership governed by an amended and restated limited partnership agreement dated August 1, 2022.
48. If the Exemption Sought is granted, the Trading Fund will hold no more than 10% of its NAV in securities of other investment funds.
49. The value of the portfolio assets of the Trading Fund is independently determined by a party that is arm's length to the Filer and NHC on a monthly basis and on any day on which the Trading Fund has capital activity, using NHC's valuation policy applied in accordance with US GAAP, including Accounting Standards Codification 820, subject to NHC's final approval of all pricing and valuation determinations.
50. Neither the Cayman Master Fund nor the Trading Fund is a reporting issuer in any jurisdiction of Canada.
51. Securities of the Cayman Master Fund and of the Trading Fund are not generally sold or otherwise made available directly to Canadian retail investors.
52. Each of the Cayman Master Fund and the Trading Fund is an "investment fund" as such term is defined under Canadian securities legislation.
53. Neither the Cayman Master Fund nor the Trading Fund is in default of the securities legislation of any Jurisdiction.
Investments by the Canadian Feeder Trust in the Cayman Feeder Fund, the Cayman Master Fund, and the Trading Fund
54. The Canadian Feeder Trust, the Cayman Feeder Fund, the Cayman Master Fund and the Trading Fund each pursue the same investment objective, with the Canadian Feeder Trust investing substantially all of its investable assets in the Cayman Feeder Fund, which in turn invests substantially all of its investable assets in the Cayman Master Fund, which currently invests all of its investable assets in the Trading Fund. As a result, each of the Canadian Feeder Trust, the Cayman Feeder Fund, and the Cayman Master Fund operate in a manner similar to a "clone fund", each effectively seeking to track the performance of the Trading Fund.
55. An investment by the Canadian Feeder Trust in the Cayman Feeder Fund represents the business judgment of a responsible person uninfluenced by considerations other than the best interests of the Canadian Feeder Trust, and aligns with the investment structure and design described in the Canadian Feeder Trust's Offering Document.
56. The securities of the Cayman Feeder Fund managed by NHC are not currently available to Canadian retail investors, except through the Canadian Feeder Trust.
57. The NAV of the Cayman Feeder Fund, the Cayman Master Fund, and the Trading Fund are calculated in accordance with the valuation principles, policies and procedures, as may be amended from time to time, established by NHC. An independent third-party calculation agent (NAV Calculation Agent) calculates a NAV that is used for purposes of determining the purchase and redemption price of the units of the Cayman Feeder Fund, the Cayman Master Fund and the Trading Fund. The NAV Calculation Agent also independently verifies the valuations of the Cayman Feeder Fund, Cayman Master Fund, and Trading Fund, with NHC's valuation committee having the ability to make the final decision with respect to unresolved differences, if any. The final valuation is reviewed and approved by NHC's accounting team.
58. The NAV of the Canadian Feeder Trust is generally based on the value provided by the Cayman Feeder Fund and in turn the Cayman Master Fund. In addition, when preparing the annual audited financial statements of the Canadian Feeder Trust, the auditor of the Canadian Feeder Trust independently validates the values of the Canadian Feeder Trust's investments.
59. The Filer, the Top Funds and the Canadian Feeder Trust managed by the Filer do not actively participate in the business, operations or valuations of the portfolios of the Cayman Feeder Fund, Cayman Master Fund, or Trading Fund. No officers, directors or employees of the Filer currently participate in the valuation committee appointed by NHC.
60. A summary of the valuation policies and procedures applied by NHC to the Cayman Master Fund and Cayman Feeder Fund is described in the Offering Document of the Canadian Feeder Trust made available to investors in the Canadian Feeder Trust, including the Top Funds.
61. The financial statements of the Canadian Feeder Trust are prepared in accordance with International Financial Reporting Standards and audited by a qualified auditing firm on an annual basis. Such audit includes independent confirmation of the fair value of each portfolio investment. The auditor also audits the value of the portfolio investments to ensure that they are accurately valued in accordance with the Canadian Feeder Trust's valuation policy. Annual audited financial statements will be made accessible by the Filer to unitholders of the Canadian Feeder Trust within 90 days of each fiscal year end.
62. The financial statements of the Cayman Feeder Fund, Cayman Master Fund and Trading Fund are each audited by a qualified auditing firm on an annual basis.
Investments by the Top Funds in the Canadian Feeder Trust
63. Each Top Fund wishes to be able to invest in securities of the Canadian Feeder Trust and, as a result, the Filer is seeking the Exemption Sought in order to permit the Top Funds to make such investments.
64. Each investment by a Top Fund in securities of the Canadian Feeder Trust will be made in accordance with the investment objective of such Top Fund, and will represent the business judgment of responsible persons uninfluenced by considerations other than the best interests of such Top Fund.
65. The Filer believes that investing in the Canadian Feeder Trust will provide the Top Funds with an efficient and cost-effective way to obtain exposure to absolute return investment strategies and gain access to the specialized investment expertise of NHC. The Filer believes that a meaningful allocation to the Canadian Feeder Trust and indirectly to the Cayman Master Fund provides Top Fund investors with unique diversification opportunities and represents an appropriate investment tool for the Top Funds that was not available in the past.
66. Investments by a Top Fund in the Canadian Feeder Trust will be effected at an objective price. The Filer's policies and procedures provide that an objective price, for this purpose, will be the NAV per security of the applicable class or series of the Canadian Feeder Trust.
67. The NAV of the Top Funds is calculated using the fair value of the assets and liabilities of the Top Funds. In respect of the Public Top Funds, the calculation of NAV is done in accordance with Part 14 of National Instrument 81-106 Investment Fund Continuous Disclosure. In respect of the Private Top Funds, the Filer may determine a valuation of a security in the portfolio of the Private Top Funds that is considered to be fair and reasonable in the circumstances.
68. Investments in the Canadian Feeder Trust are considered illiquid investments under NI 81-102 and, therefore, are not permitted to exceed 10% of the NAV of a Public Top Fund. Such investments are included as part of the calculation for the purposes of the illiquid asset restriction in section 2.4 of NI 81-102 for a Public Top Fund. Given the readily available liquidity of the remainder of each Public Top Fund's investment portfolio, the Filer believes that the risk of a Public Top Fund needing to liquidate its investment in these illiquid assets when markets are under stress or in other environments where liquidity may be reduced is remote.
69. A Private Top Fund considers its overall liquidity requirements and the limitations on its redemption rights in making any investment in the Canadian Feeder Trust.
NI 81-102 Relief in Respect of the Public Top Funds
70. The Public Top Funds wish to have the ability to purchase securities of the Canadian Feeder Trust, which is neither a reporting issuer nor subject to NI 81-102, and which will hold more than 10% of its NAV in securities of other investment funds.
71. Absent the NI 81-102 Relief, a Public Top Fund would be prohibited by
(a) sections 2.5(2)(a) and 2.5(2)(c) from purchasing or holding securities of the Canadian Feeder Trust because the Canadian Feeder Trust (i) is not subject to NI 81-102; and (ii) is not a reporting issuer in the Jurisdictions; and
(b) section 2.5(2)(b) from purchasing or holding securities of the Canadian Feeder Trust because the Canadian Feeder Trust itself, similar to a clone fund, invests substantially all of its investable assets in the Cayman Feeder Fund, which invests substantially all of its investable assets in the Cayman Master Fund, which currently invests all of its investable assets in the Trading Fund.
72. The Public Top Funds will otherwise comply with section 2.5 of NI 81-102 with respect to any investment in the Canadian Feeder Trust.
73. The manager of the Public Top Funds will request approval from the IRC of the Public Top Funds to permit the investment of the Public Top Funds in the Canadian Feeder Trust, including by way of standing instructions. No such investments will be made by a Public Top Fund until the IRC provides its approval under section 5.2 of NI 81-107. The manager of the Public Top Funds will comply with section 5.1 of NI 81-107 and the manager of the Public Top Funds and the IRC of the Public Top Funds will comply with section 5.4 of NI 81-107 for any standing instructions the IRC provides in connection with the transactions. If the IRC becomes aware of an instance where the manager of a Public Top Fund did not comply with the terms of any decision evidencing the Exemption Sought, or a condition imposed by securities legislation or the IRC in its approval, the IRC of the Public Top Fund will, as soon as practicable, notify in writing the securities regulatory authority or regulator in the Jurisdiction under which the Public Top Fund is organized.
74. A unit of the Canadian Feeder Trust will be considered an "illiquid asset" within the meaning of NI 81-102. Consequently, if the Exemption Sought is granted, a Public Top Fund will acquire securities of the Canadian Feeder Trust, whether directly or indirectly, subject to the illiquid asset restriction in section 2.4 of NI 81-102. As a result, a Public Top Fund will not purchase units of the Canadian Feeder Trust if immediately after purchase, more than 10% of the NAV of the Public Top Fund would be made up of "illiquid assets".
75. Section 2.5(7) of NI 81-102 provides that the "investment fund conflict of interest investment restrictions" and the "investment fund conflict of interest reporting requirements" (as such terms are defined in NI 81-102) do not apply to an investment fund which purchases or holds securities of another investment fund if the purchase or holding is made in accordance with section 2.5 of NI 81-102. Further to section 3.4(2) of the companion policy to NI 81-102, the Filer understands that, if the NI 81-102 Relief is granted, investments by the Public Top Funds in the Canadian Feeder Fund will be considered to have been made in accordance with section 2.5, provided the Public Top Funds comply with the conditions of the Exemption Sought.
Related Issuer Relief and Consent Relief in respect of the Private Top Funds
76. As the Private Top Funds do not satisfy the requirements in section 2.5.1 of NI 81-102 in respect of their investments in the Canadian Feeder Trust and may not otherwise rely on section 2.5(7) of NI 81-102, the Private Top Funds are subject to the investment fund conflict of interest investment restrictions in section 111 of the Securities Act (Ontario) and section 13.5 of NI 31-103.
77. The amount invested from time to time in the Canadian Feeder Trust by a Private Top Fund, together with one or more Top Funds, may exceed 20% of the outstanding voting securities of the Canadian Feeder Trust. As a result, each Private Top Fund could, together with one or more other Top Funds, become a "substantial security holder" of the Canadian Feeder Trust within the meaning of the Legislation, further to which the Private Top Funds would be prohibited under the Legislation from knowingly purchasing and holding securities of the Canadian Feeder Trust. The Top Funds are, or will be, "related investment funds", as such term is defined in the Legislation by virtue of common management by the Filer or by an affiliate of the Filer.
78. In addition, AGF Management Limited, an affiliate and substantial security holder of the Filer and its affiliates, may from time to time have a "significant interest" in the Canadian Feeder Trust within the meaning of the Legislation as a result of providing seed capital to the Canadian Feeder Trust, which would prohibit the Private Top Funds from investing in the Canadian Feeder Trust.
79. Absent the Related Issuer Relief, each Private Top Fund would be prohibited by section 111 of Securities Act (Ontario) from (i) becoming a substantial security holder of the Canadian Feeder Trust, alone or together with other Top Funds, and (ii) investing in the Canadian Feeder Trust, as an issuer in which an officer or director of the Filer or of an affiliate of the Filer has a significant interest or in which a person or company who is a substantial security holder of the Private Top Fund or the Filer has a significant interest.
80. Paragraph 13.5(2)(a) of NI 31-103 prohibits the Filer or an affiliate that acts as portfolio manager of a Private Top Fund from knowingly causing a Private Top Fund to invest in the Canadian Feeder Trust where the Filer, an affiliate of the Filer, or an associate of the Filer or its affiliate, is also a partner, director or officer of the Canadian Feeder Trust, unless (i) this fact is disclosed to the client and (ii) the written consent of the client to the purchase is obtained before the purchase. It is impractical for the Filer to obtain the prior written consent from each investor in a Private Top Fund, given the widely held nature of the Private Top Funds.
81. The Filer is or will be considered a "responsible person" (as such term is defined in NI 31-103) of a Private Top Fund and the Canadian Feeder Trust since the Filer is or will be the manager of the Private Top Fund and the manager of the Canadian Feeder Trust.
82. Absent the Consent Relief, the Filer or an affiliate of the Filer acting as portfolio manager of a Private Top Fund would be prohibited by paragraph 13.5(2)(a) of NI 31-103 from causing a Private Top Fund to invest in securities of the Canadian Feeder Trust without disclosing this fact and obtaining the written consent of each investor in the Private Top Fund before the purchase.
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted provided that:
(a) securities of the Private Top Funds and the Canadian Feeder Trust are distributed in Canada solely to investors pursuant to exemptions from the prospectus requirements in NI 45-106 or the Legislation, as applicable;
(b) an investment by a Top Fund in the Canadian Feeder Trust is compatible with the investment objective and strategy of the Top Fund, and included as part of the calculation for the purposes of a Public Top Fund's compliance with the illiquid asset restriction in section 2.4 of NI 81-102;
(c) at the time of purchase by a Top Fund of securities of the Canadian Feeder Trust, either (A) the Trading Fund does not hold more than 10% of its NAV in securities of other investment funds, or (B) the Trading Fund:
(i) has adopted a fundamental investment objective to track the performance of another investment fund or similar investment product;
(ii) purchases or holds securities of investment funds that are "money market funds" (as such term is defined in NI 81-102); or
(iii) purchases or holds securities that are "index participation units" (as such term is defined in NI 81-102) issued by an investment fund;
(d) in respect of an investment by a Public Top Fund in the Canadian Feeder Trust, the investment will otherwise comply with section 2.5 of NI 81-102, except to the extent that exemptive relief has been granted from such requirement;
(e) no sales or redemption fees will be paid as part of the investment by a Top Fund in the Canadian Feeder Trust, unless the Top Fund redeems its securities of the Canadian Feeder Trust during a lock-up period, in which case an early redemption fee may be payable by the Top Fund;
(f) no management fees or incentive fees will be payable by the Top Fund that, to a reasonable person, would duplicate a fee payable by the Canadian Feeder Trust for the same service;
(g) the securities of the Canadian Feeder Trust held by a Top Fund will not be voted at any meeting of the security holders of the Canadian Feeder Trust, except that a Top Fund may arrange for the securities of the Canadian Feeder Trust it holds to be voted by the beneficial holders of securities of the Top Fund;
(h) where applicable, a Public Top Fund's investment in the Canadian Feeder Trust will be disclosed to investors in such Public Top Fund's quarterly portfolio holding reports, financial statements and/or fund facts, as applicable;
(i) the prospectus of the Public Top Funds discloses, or will disclose in the next renewal or amendment thereto following the date of a decision evidencing the Exemption Sought, the fact that the Public Top Funds may invest, directly or indirectly, in the Canadian Feeder Trust, which is an investment vehicle managed by an affiliate of the Filer;
(j) the Offering Document of a Private Top Fund will disclose in the next update thereto following the date of the decision granting the Exemption Sought hereby the following information:
(i) that the Private Top Fund may directly or indirectly purchase securities of the Canadian Feeder Trust;
(ii) the fact that the Filer is the investment fund manager or portfolio manager of the Private Top Fund and the manager of the Canadian Feeder Trust; and
(iii) that no fees or sales charges will be incurred, directly or indirectly, by the Private Top Fund with respect to an investment in the Canadian Feeder Trust that, to a reasonable person, would duplicate a fee payable by the Private Top Fund to the Filer or its investors for the same service;
(k) the IRC of the Public Top Funds will review and provide its approval, including by way of standing instructions, prior to the purchase of securities of the Canadian Feeder Trust, directly or indirectly, by a Public Top Fund, in accordance with section 5.2(2) of NI 81-107;
(l) the Filer complies with section 5.1 of NI 81-107 and the Filer and the IRC of the Public Top Fund comply with section 5.4 of NI 81-107 for any standing instructions the IRC provides in connection with the transactions;
(m) if the IRC becomes aware of an instance where the Filer or an affiliate of the Filer, in its capacity as the manager of a Public Top Fund, did not comply with the terms of this decision, or a condition imposed by securities legislation or the IRC in its approval, the IRC of the Public Top Fund will, as soon as practicable, notify in writing the securities regulatory authority or regulator in the Jurisdiction under which the Public Top Fund is organized;
(n) where an investment is made by a Public Top Fund in the Canadian Feeder Trust, the Public Top Fund's annual and interim management reports of fund performance will disclose the name of the related person in which an investment is made, being the Canadian Feeder Trust;
(o) where an investment is made by a Top Fund in the Canadian Feeder Trust, the records of portfolio transactions maintained by the Top Fund include, separately for every portfolio transaction effected by a Top Fund by the Filer, the name of the related person in which an investment is made, being the Canadian Feeder Trust; and
(p) a Top Fund will invest in, and redeem, the Canadian Feeder Trust at the NAV of the applicable securities of the Canadian Feeder Trust calculated based on the valuation of the portfolio assets to which the Canadian Feeder Trust has exposure, including the Cayman Master Fund, that is either independently determined by an arm's length third party or determined in accordance with the respective valuation policies of the Filer and NHC.
Application File #: 2025/0661
SEDAR+ File #: 6356160
Multilateral Instrument 11-102 Passport System and National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- National Instrument 52-107 Acceptable Accounting Principles and Auditing Standards (NI 52-107), s. 5.1 -- the Filer is granted relief from the requirements under section 3.2 of NI 52-107 that financial statements be prepared in accordance with Canadian GAAP applicable to publicly accountable enterprises in order to permit the Filer to prepare its financial statements in accordance with U.S. GAAP.
National Instrument 52-107 Acceptable Accounting Principles and Auditing Standard, ss. 3.2 and 5.1.
December 15, 2025
The principal regulator in the Jurisdiction (the Principal Regulator) has received an application from the Filer for a decision under the securities legislation of the Jurisdiction (the Legislation) for an exemption (the Exemption Sought) from the requirements of section 3.2 of National Instrument 52-107 -- Acceptable Accounting Principles and Auditing Standards (NI 52-107) that financial statements of the Filer (a) be prepared in accordance with Canadian generally accepted accounting principles (Canadian GAAP) applicable to publicly accountable enterprises and (b) disclose an unreserved statement of compliance with International Financial Reporting Standards (IFRS) in the case of annual financial statements and an unreserved statement of compliance with IAS 34 in the case of an interim financial report. The Exemption Sought is similar to the exemption granted by the Ontario Securities Commission (OSC) to the Filer on September 30, 2022, in Re Ontario Power Generation Inc. (the U.S. GAAP Relief). This decision document of the OSC will revoke the U.S. GAAP Relief.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the OSC is the Principal Regulator for this application;
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 -- Passport System (MI 11-102) is intended to be relied upon in British Columbia, Alberta, Saskatchewan, Manitoba, Québec, New Brunswick, Nova Scotia, Prince Edward Island and Newfoundland and Labrador (the Passport Jurisdictions); and
(c) the decision is the decision of the Principal Regulator and automatically results in an equivalent decision in the Passport Jurisdictions.
In this decision:
(a) unless otherwise defined herein, terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 52-107 have the same meaning if used herein; and
(b) "rate-regulated activities" has the meaning ascribed thereto in the Chartered Professional Accountants of Canada Handbook (the Handbook).
This decision is based on the following facts represented by the Filer.
1. The Filer is incorporated under the Business Corporations Act (Ontario). The head office of the Filer is located at 1908 Colonel Sam Drive, Oshawa, ON L1H 8W8.
2. The Filer is a reporting issuer or equivalent in the Jurisdiction and each Passport Jurisdiction and is not in default of securities legislation in any jurisdiction in Canada.
3. The Filer currently prepares its financial statements for annual and interim periods in accordance with U.S. GAAP as permitted by the U.S. GAAP Relief.
4. The Filer is not an SEC issuer.
5. The Filer carries on rate-regulated activities.
6. Were the Filer an SEC issuer, it would be permitted by section 3.7 of NI 52-107 to file financial statements prepared in accordance with U.S. GAAP.
7. The U.S. GAAP Relief provided that it would cease to apply to the Filer on the earliest of: (a) January 1, 2027; (b) if the Filer ceased to have activities subject to rate regulation, the first day of the Filer's financial year that commenced after the Filer ceased to have activities subject to rate regulation; and (c) the effective date prescribed by the International Accounting Standards Board (IASB) for the mandatory application of a standard within IFRS specific to entities with activities subject to rate regulation. Accordingly, in the absence of further relief provided by Canadian securities regulators, the Filer would become subject to Canadian GAAP no later than January 1, 2027. Canadian GAAP includes IFRS as incorporated into the Handbook.
8. The issuance by the IASB of a standard within IFRS for entities with rate-regulated activities (a Mandatory Rate-regulated Standard) would result in the expiry of the U.S. GAAP Relief, giving rise to the obligation of the Filer to commence financial statement preparation and reporting in accordance with IFRS pursuant to NI 52-107.
9. In January 2021, the IASB published the Exposure Draft -- Regulatory Assets and Regulatory Liabilities, which introduces a proposed standard of accounting for regulatory assets and liabilities, applicable to entities with rate-regulated activities. In July 2024, the IASB concluded its redeliberations and confirmed readiness to move forward with new IFRS Accounting Standard to supersede IFRS 14. In October 2025, the IASB published an update on the review and comment process on the proposed standard, including the staff analysis and recommendations on certain issues, and indicated that the drafting and balloting process was continuing.
10. The IASB has publicly stated that it expects to publish the new standard in the second quarter of 2026, although the effective date (now expected to be January 1, 2029) has not been confirmed. The Filer will require sufficient time to: (a) interpret and implement such standard and transition from financial statement preparation and reporting in accordance with U.S. GAAP to IFRS; and (b) interpret and reconcile the implications on the customer rate setting process resulting from the implementation.
The Principal Regulator is satisfied that the decision meets the test set out in the Legislation for the Principal Regulator to make the decision.
The decision of the Principal Regulator under the Legislation is that:
(a) the U.S. GAAP Relief is revoked;
(b) the Exemption Sought is granted to the Filer in respect of the Filer's financial statements required to be filed on or after the date of this order, provided that the Filer prepares such financial statements in accordance with U.S. GAAP; and
(c) the Exemption Sought will terminate in respect of the Filer on the earliest of the following:
(i) January 1, 2032;
(ii) if the Filer ceases to have rate-regulated activities, the first day of the Filer's financial year that commences after the Filer ceases to have rate-regulated activities; and
(iii) the first day of the Filer's financial year that commences on or following the later of:
1. the effective date prescribed by the IASB for the Mandatory Rate-regulated Standard; and
2. four years after the IASB publishes the final version of a Mandatory Rate-regulated Standard.
OSC File #: 2025/0651
Obsiido Alternative Investments Inc. et al.
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- One-time transfer of portfolio securities between two funds, both advised by the same portfolio adviser, to implement a merger between the funds -- Funds have substantially similar investment objectives, strategies, and valuation policies -- Costs of the merger borne by manager -- Sale of securities exempt from the self-dealing prohibition in paragraph s. 13.5(2)(b)(iii), National Instrument 31-103 -- Registration Requirements, Exemptions and Ongoing Registrant Obligations.
National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations, ss. 13.5(2)(b)(iii) and 15.1.
December 11, 2025
The principal regulator in the Jurisdiction has received a passport application from the Filer, who is the portfolio manager of the Terminating Fund and the Continuing Fund (collectively, the Funds) on the Effective Date (as defined below) for a decision under securities legislation of the Jurisdiction (the Legislation) for an exemption from the prohibition contained in subparagraph 13.5(2)(b)(iii) of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103) which prohibits a registered adviser from knowingly causing an investment portfolio managed by it, including an investment fund for which it acts as an adviser, to purchase or sell a security from or to the investment portfolio of an investment fund for which a responsible person acts as an adviser in order to effect the proposed merger (the Merger) of the Terminating Fund into the Continuing Fund (the Exemption Sought).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
a. the Ontario Securities Commission is the principal regulator for this application; and
b. the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in the province of Alberta (together with Ontario, the Jurisdictions).
Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined.
This decision is based on the following facts represented by the Filer:
A. The Filer
1. The Filer is a corporation formed under the laws of the Province of Ontario with its head office in Toronto, Ontario.
2. The Filer is a registered investment fund manager in Ontario, and a portfolio manager and exempt market dealer in British Columbia, Ontario, and Alberta.
3. The Filer is not in default of securities legislation in any jurisdiction of Canada.
B. The Funds
4. The Filer acts as investment fund manager, portfolio manager and trustee for the Funds.
5. Each Fund is an open-ended trust established under the laws of the Province of Ontario and governed by the third amended and restated master declaration of trust dated November 3, 2025 (the Trust Agreement).
6. The Funds are not reporting issuers in any jurisdiction and are not subject to National Instrument 81-102 Investment Funds.
7. Each Fund offers its units in the Jurisdictions pursuant to available prospectus exemptions in accordance with National Instrument 45-106 Prospectus Exemptions.
8. The Funds are not in default of securities legislation in any jurisdiction of Canada.
9. Each Fund is a "mutual fund trust" as defined in the Income Tax Act (Canada) (the Tax Act).
10. The objective of the Terminating Fund is to seek to generate consistent income while preserving capital by investing substantially all of its assets in a diversified portfolio of income-generating alternative investments, including but not limited to real assets, private credit and hedge funds. The Terminating Fund will invest on a global basis.
11. To achieve its objective, the Terminating Fund invests its assets primarily in underlying investment funds or other investment vehicles managed by third-party alternative investment managers.
12. The objective of the Continuing Fund is to seek to generate attractive long-term risk-adjusted returns with consistent income generation by investing substantially all of its assets in a diversified portfolio of alternative investments, including but not limited to private credit, real assets, private equity and hedge funds. The Continuing Fund will invest on a global basis.
13. To achieve its objective, the Continuing Fund invests its assets primarily in underlying investment funds or other investment vehicles managed by third-party alternative investment managers.
C. The Proposed Merger
14. The Filer wishes to merge the Terminating Fund into the Continuing Fund effective as of March 31, 2026 (the Effective Date), subject to receipt of all regulatory approvals. The Filer has decided to effect the Merger because of the similarities in the Funds' investment portfolios.
15. Pursuant to the Trust Agreement, no special meeting of unitholders is required to be called in order to approve the Merger.
16. Unitholders of the Funds will be provided a written notice of the Merger at least 60 days prior to the Effective Date and once the Exemption Sought is granted.
17. The Filer has determined that the Merger is not material to the Continuing Fund.
18. There will be no increase in management fees paid by unitholders of the Terminating Fund and the Continuing Fund as a result of the Merger.
19. No redemption fees, other fees or commissions will be payable by the Funds' unitholders in connection with the Merger. No sales charges will be payable in connection with the acquisition by the Continuing Fund of the Terminating Fund's investment portfolio.
20. The costs of the Merger will be borne by the Filer.
21. It is expected that the Merger will occur on a taxable basis. Unitholders in cash accounts may be subject to taxable gains or losses. The Merger will not give rise to material adverse tax consequences for the Terminating Fund and its unitholders.
22. Unitholders of the Terminating Fund will be able to redeem their units at the Terminating Fund's net asset value at all redemption dates up to and on the Effective Date.
23. The investment objectives and portfolios of the Continuing Fund and the Terminating Fund are similar and there is substantial overlap in the underlying portfolio securities. The portfolio of assets of the Terminating Fund to be acquired by the Continuing Fund arising from the Merger will be consistent with the investment objectives of the Continuing Fund and comply with the Continuing Fund's investment restrictions.
24. The net asset value of each of the Funds is determined using the same valuation principles.
25. The following steps will be carried out to effect the Merger:
i. the value of the Terminating Fund's investment portfolio and other assets will be determined as of the close of business on the Effective Date in accordance with the Trust Agreement;
ii. any securities in the investment portfolio of the Terminating Fund which do not conform to the investment objective, strategies and restrictions of the Continuing Fund will be sold for cash, if needed;
iii. the Continuing Fund will acquire the portfolio assets and other assets of the Terminating Fund in exchange for units of the Continuing Fund;
iv. the Continuing Fund will not assume the liabilities of the Terminating Fund and the Terminating Fund will retain sufficient assets to satisfy its estimated liabilities, if any, as of the date of the Merger;
v. the units of the Continuing Fund received by the Terminating Fund will have an aggregate net asset value equal to the value of the Terminating Fund's portfolio assets and other assets that the Continuing Fund is acquiring, which units will be issued at the applicable net asset value per unit as of the close of business on the Effective Date;
vi. if necessary, the Terminating Fund will distribute a sufficient amount of its income and capital gains, if any, to ensure that the Terminating Fund will not be liable for income tax under Part I of the Tax Act, other than alternative minimum tax, for its current taxation year;
vii. immediately thereafter, the units of the Continuing Fund received by the Terminating Fund will be distributed to unitholders of the Terminating Fund on a dollar-for-dollar basis in exchange for their respective equivalent series of units in the Terminating Fund; and
viii. as soon as reasonably possible following the Merger, the Terminating Fund will be wound up.
26. The assets of the Funds will be valued in accordance with the valuation policies and procedures outlined in the Trust Agreement and, at this value, the assets of the Terminating Fund will subsequently be exchanged for units of the Continuing Fund as described above.
27. The Filer has determined it is in the best interest of the Funds to proceed with the Merger.
28. The transfer of the assets of the Terminating Fund to the Continuing Fund will not adversely impact the liquidity of the Continuing Fund.
29. The board of directors of the Filer has determined that the Merger is in the best interests of the Funds and has approved the Merger, subject to obtaining the Exemption Sought.
30. The Filer believes that the Merger is in the best interest of unitholders of the Funds for the following reasons:
i. the Filer believes it is suitable for unitholders of the Terminating Fund to hold units of the Continuing Fund and be exposed to the Continuing Fund's objective and strategy;
ii. the Merger will result in a more streamlined and simplified product line-up by eliminating similar fund offerings across product line ups, reducing duplication and redundancy;
iii. a greater pool of assets for the Continuing Fund will provide its unitholders with increased diversification; and
iv. the Continuing Fund will benefit from its larger profile in the marketplace.
31. Though the desired end result of the Merger could be achieved by each unitholder redeeming his or her units of the Terminating Fund and using the proceeds to purchase units of the Continuing Fund, this could not be done in a timely manner and would not be beneficial to unitholders of the Terminating Fund. The Terminating Fund would be subject to (i) early redemption penalties associated with the sale of most of the portfolio securities to provide liquidity for the redemptions, and (ii) hard lock-ups associated with a portion of the portfolio securities, which would prohibit the Terminating Fund from liquidating those portfolio securities in a timely manner. Further, executing the trades in this manner would result in negative consequences to the Terminating Fund and the Continuing Fund through the incurrence of unnecessary brokerage charges relating to the sale and repurchase of portfolio securities.
32. The portfolio securities and other assets of the Terminating Fund will be transferred from the Terminating Fund to the Continuing Fund in accordance with the steps described above. Because the transfer of portfolio securities and assets will take place at a value determined by common valuation procedures and the issue of units will be based upon the relative net asset value of the portfolio securities and other assets received by the Continuing Fund and notice and redemption rights will have been provided to unitholders, any potential conflict of interest will have been adequately addressed and as a result, there should be no conflict of interest for the Filer in effecting the Merger.
33. The sale of the assets of the Terminating Fund to the Continuing Fund, and the corresponding purchase of such assets by the Continuing Fund, as a step in the Merger may be considered a purchase or sale of securities, knowingly caused by a registered adviser that manages the investment portfolios of both Funds, from the Terminating Fund to, or by the Continuing Fund from, an investment fund for which a "responsible person" acts as an adviser, contrary to subparagraph 13.5(2)(b)(iii) of NI 31-103.
34. Unless the Exemption Sought is granted, the Filer would be prohibited from knowingly causing the units of the Terminating Fund to be issued to the Continuing Fund in connection with the Merger.
The principal regulator is satisfied that this decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted.
Application File #: 2025/0675
Cumberland Investment Counsel Inc.
Pursuant to National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Relief from the know-your-client, trusted contact person and suitability determination requirements, and the requirements to deliver account statements and investment performance reports, granted to a portfolio manager in respect of investors in a model portfolio service offered through affiliated and unaffiliated mutual fund dealers and investment dealers -- decision should not be viewed as precedent for other filers
Multilateral Instrument 11-102 Passport System, s. 4.7(1)
National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations, ss. 13.2, 13.2.01, 13.3, 14.14, 14.14.1, 14.18 and 15.1(2)
December 3, 2025
The principal regulator in the Jurisdiction has received an application from the Filer for a decision under the securities legislation of the Jurisdiction (the Legislation) exempting the Filer, and the affiliate of the Filer, NCM Asset Management Ltd. (NCM), registered as an adviser in one or more of the Canadian Jurisdictions (as defined below) (with the Filer, each an Adviser and collectively the Advisers), from the following requirements with respect to clients invested in accordance with the Model Portfolios (as defined below):
(a) the requirements (the Know Your Client Requirements) in the Legislation that the Advisers take reasonable steps to:
(i) establish the identity of a client and, if the Adviser has cause for concern, make reasonable inquiries as to the reputation of the client;
(ii) establish whether the client is an insider of a reporting issuer or any other issuer whose securities are publicly traded;
(iii) ensure that the Adviser has sufficient information regarding the client's investment needs and objectives, financial circumstances and risk profile, among other information, to enable the Adviser to meet its suitability determination obligations under the Legislation (as described below); and
(iv) keep the information described above current
(collectively, the Know Your Client Exemption);
(b) the requirement (the Trusted Contact Person Requirement) in the Legislation that the Advisers take reasonable steps to:
(i) obtain from the client the name and contact information of a trusted contact person, and the written consent of the client for the Adviser to contact the trusted contact person to confirm or make inquiries about any of the following:
a. the Adviser's concerns about possible financial exploitation of the client;
b. the Adviser's concerns about the client's mental capacity as it relates to the ability of the client to make decisions involving financial matters;
c. the name and contact information of a legal representative of the client, if any;
d. the client's contact information; and
(ii) keep the information described above current
(collectively, the Trusted Contact Person Exemption);
(c) the requirement (Suitability Determination Requirement) in the Legislation that the Adviser, before it opens an account for a client, purchases, sells, deposits, exchanges or transfers securities for a client's account, takes any other investment action for a client, makes a recommendation or exercises discretion to take any such action, determine, on a reasonable basis, that such action is suitable for the client and puts the client's interest first (the Suitability Determination Exemption); and
(d) the requirement (the Statement Delivery Requirement) in the Legislation that the Adviser deliver account statements and investment performance reports to clients who have invested in accordance with the Model Portfolios
(the Statement Delivery Exemption and, together with the Know Your Client Exemption, Trusted Contact Person Exemption and Suitability Determination Exemption, the Exemption Sought).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application; and
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon by the Advisers in Alberta, British Columbia, Quebec, and Newfoundland & Labrador (each, a Jurisdiction and, together with Ontario, the Canadian Jurisdictions) in respect of the Exemption Sought.
Terms defined in MI 11-102 and National Instrument 14-101 Definitions have the same meaning if used in this decision, unless otherwise defined.
NI 31-103 means National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations.
This decision is based on the following facts represented by the Filer:
The Filer
1. The Filer is a corporation continuing under the laws of Ontario, with its head office located in Toronto, Ontario.
2. The Filer is registered as a portfolio manager in Alberta, British Columbia, Ontario and Québec.
3. NCM is a corporation continuing under the federal laws of Canada with its head office in Calgary, Alberta.
4. NCM is registered as an investment fund manager in Alberta, Newfoundland and Labrador, Ontario and Québec, and a portfolio manager in Alberta and Ontario.
5. The Filer and NCM are not in default of securities legislation in any of the Canadian Jurisdictions.
The Model Portfolio Service
6. An Adviser, in its role as portfolio manager, may create, manage and monitor model portfolios (the Services), comprising of investment funds managed by the affiliate of the Adviser or third-party unaffiliated investment fund managers (collectively, the Funds).
7. Each Fund will be an open-ended investment fund, including an exchange-traded fund (ETF), established under the laws of a Canadian province or territory.
8. Each Fund will be a reporting issuer in one or more of the provinces or territories of Canada and will be subject to the provisions of National Instrument 81-102 Investment Funds.
9. The securities of each Fund that is an ETF will be listed and traded on a recognized exchange.
10. Pursuant to a written agreement (the Model Portfolio Agreement) between the Adviser and the applicable dealer, the Adviser will provide the Services to be made available to clients of investment dealers and mutual fund dealers (the Dealers) that participate in the Dealers' model portfolio programs (each, a Program).
11. Each Dealer will be: (a) registered in the applicable Canadian Jurisdictions as a dealer in the category of mutual fund dealer, and a member of the Canadian Investment Regulatory Organization (CIRO); or (b) registered in the applicable Canadian Jurisdictions as a dealer in the category of investment dealer, and a member of CIRO. The Dealers may include dealers that are affiliated with the Adviser.
12. The Programs will allow Dealers to recommend to clients model portfolios of Funds (each, a Model Portfolio) that are created and maintained by the Adviser pursuant to the Services.
13. As part of the Services, the Adviser will manage each Model Portfolio to ensure it remains in compliance with its stated investment objective(s) and investment guidelines at all times (the Investment Guidelines) and will determine from time to time whether any changes to the composition of the Model Portfolio would be appropriate.
14. The Adviser will develop and monitor the asset allocation for the Model Portfolios, as well as direct trades that reflect changes in the Model Portfolios made from time to time and that will be effected by the Dealers in client accounts. Each Model Portfolio will comprise a selection of Funds and will have its own unique allocation of Funds that are exposed to different asset classes (the Asset Classes).
15. Exposure to the different Asset Classes in a Model Portfolio will be achieved using the Funds. Each Model Portfolio will have a percentage target weight within one or more Asset Classes (the Target Weight), which may, due to changes in the market value of the Funds within the Model Portfolio, increase or decrease within an upper and lower range (the Permitted Range). From time to time, the Adviser may recommend changing the Target Weight within the Permitted Range of a Model Portfolio or may recommend replacing a Fund in the Model Portfolio with one or more alternative Funds (the Model Re-allocation).
16. As part of the Program, provided that the Dealer representative, except in exceptional circumstances, is given at least 60 days' advance written notice (the Written Notice) and the Model Portfolio remains consistent with its stated investment objective at all times, the Filer may also, from time to time, use its discretion to make decisions regarding certain changes to the Permitted Ranges (the Weighting Changes). Where the Adviser updates a Model Portfolio to reflect a Weighting Change, the Dealer will execute appropriate trades (Weighting Change Trades) within a reasonable time to reflect such updates in client accounts.
17. The Written Notice will describe the proposed Weighting Change and will provide sufficient detail for the Dealer representative to determine whether the Model Portfolios, after the implementation of the proposed change, would continue to be appropriate for their clients. The Written Notice will specify that if the Dealer representative does not provide an objection on behalf of their client to the proposed Weighting Change by a specified date, such non-objection will be deemed to be consent for the changes on the effective date.
18. When the Model Portfolio exceeds the Permitted Range, the Adviser will update the Model Portfolio so that it is returned to a relative weight that is within the Permitted Range, and the Adviser will provide to the Dealer recommendations to rebalance the holdings in the Funds in the Model Portfolios within the Permitted Ranges (an Account Rebalance) and disclosure on the performance of the Model Portfolio.
19. Where the Adviser updates a Model Portfolio to reflect a Model Re-Allocation or an Account Rebalance, the Dealer will execute appropriate trades (a Rebalancing Trade) within a reasonable time to reflect such updates in client accounts.
20. When effecting Rebalancing Trades and Weighting Change Trades, the Dealer will confirm receipt of the Filer's instructions and will provide written confirmation to the Filer that the trades have been effected in accordance with the Filer's instructions in the applicable client accounts.
21. The applicable Dealer will collect all of the required know-your-client (KYC), and trusted contact person (TCP) information (including information about the client's personal circumstances, financial circumstances, investment needs and objectives, investment knowledge, risk profile and investment time horizon required for a suitability determination) for each client who wishes to participate in the Program.
22. Prospective clients will meet with a registered dealing representative of the Dealer (the Dealer representative) to determine, using the usual methods (such as via questionnaires or other methods) of the Dealer, which Model Portfolio would be suitable for the client. Based on the Dealer representative's suitability determination, a Model Portfolio recommendation will be made to the prospective client by the Dealer representative.
23. The client will discuss the recommended Model Portfolio and the Funds within the Model Portfolio with their Dealer representative. The Dealer representative will communicate with the client in accordance with the Dealer's usual processes and in accordance with securities legislation, which may include face-to-face meetings (in person or on-line) and/or via telephone or email or other written correspondence. However, the client ultimately chooses the Model Portfolio. The client has no ability to select Funds within a Model Portfolio.
24. A detailed investment policy statement or similar document (the Investment Policy Statement) will be created for the client by the Dealer. The Investment Policy Statement or other similar document will reflect the Investment Guidelines of the Model Portfolio, the composition of the Model Portfolio and the Funds in the Model Portfolio, the Target Weights among the Asset Classes and the Permitted Range(s) of the Model Portfolio.
25. Once the client confirms the final Investment Policy Statement, the client will sign an acknowledgement form or similar document that describes the fees and provides for the payment of the fees to the Dealer, who will in turn pay fees to the Adviser for the Services, and the terms of the Program (the Client Agreement), approving the final Investment Policy Statement and the Model Portfolio, and authorizing the Adviser and the Dealer to implement and maintain the Model Portfolio.
26. In the Client Agreement, the client will authorize the Dealer (or an affiliate of the Dealer or another dealer registered in a category that permits the trade) to undertake trades in accordance with the Model Portfolios and as directed by the Adviser.
27. The Dealer will make trades in the Funds to invest the client in accordance with their chosen Model Portfolio.
28. A client may, from time to time, contribute additional funds to the client's account with a Dealer for investment in the selected Model Portfolio through the Services. Such additional funds will be applied towards the purchase of additional securities of the Funds in accordance with the Permitted Ranges (the Additional Investment Trades). All Additional Investment Trades will be effected by the relevant Dealer.
29. Clients will have no direct contact with the Adviser in connection with the Adviser's management of the Model Portfolios. Clients will interact solely with the applicable Dealer and Dealer representative in connection with the Adviser's management of the Model Portfolios and the Dealer's administration of the clients' accounts.
30. Each Dealer and their representatives will not market the Programs as managed account programs to their clients -- their recommendation will be limited to recommending that a client participate in a Program, through which the client will invest in accordance with a Model Portfolio. Although the Adviser develops the Model Portfolios, each Dealer and each Dealer representative must determine whether or not investing in the constituent Funds included in the Model Portfolio is suitable for that client and puts the client's interest first. The Adviser is responsible for developing the Model Portfolios and managing them, but does not refer to any specific client's circumstances in doing so.
31. Each Dealer has the option of imposing a minimum investment amount for clients to participate in the Program, and the minimum investment amounts for different Dealers may vary.
32. A client may terminate their participation in a Program at any time by contacting their Dealer.
33. Where the Dealer determines that a Model Portfolio is no longer suitable for a client or no longer puts the client's interest first or that a different Model Portfolio would be more appropriate for the client, this will be communicated to the client by the Dealer, and the Dealer will take appropriate action. A change to a different Model Portfolio will not be made without the client entering into a new Client Agreement, or amendment or new schedule to an existing Client Agreement, in respect of the new Model Portfolio.
Fees and Expenses
34. Each client that participates in the Program will pay a Dealer fee in return for the administration of the Program (the Program Fee).
35. The Program Fee will include the fee payable by the Dealer to the Adviser in return for the Services and any Outside Management Fees (as defined below).
36. The Model Portfolios comprise institutional series or, where reasonably available to the Adviser, other lower management fee series units of Funds that are conventional mutual funds, and, if applicable, units of ETFs. Any applicable management fees for institutional series units of Funds (the Outside Management Fees) that are conventional investment funds may be charged outside the Funds and negotiated by the Dealer with the applicable investment fund manager of the Fund. Certain institutional series of Funds that are conventional investment funds have operating expenses, and may have a management fee or a performance fee, that will be charged within the Funds. The management fees and operating expenses for ETFs will be charged within the ETFs.
37. There will be no duplication of any fees or charges for the same services as a result of a client's decision to participate in the Program. No sales charges, redemption fees, switch fees or early trading fees will be charged in connection with any of the trades effected by the Dealer in connection with the Service.
38. All fees and expenses charged in respect of the Program, including the Program Fee (which includes any Outside Management Fees), will be described in the Client Agreement. The fees and expenses related to the Funds, including those managed by the Filer or NCM, will be described in the Fund prospectus and Fund Facts or ETF Facts, as applicable.
Client Agreement and Client Reporting
39. If the prospective client decides to proceed with participating in a Program and investing in accordance with a Model Portfolio, the Client Acknowledgment Form Agreement is entered into between the client and the Dealer, which will set out, among other matters, the following:
(a) Model Portfolio --- The client will acknowledge the Adviser's role in managing the Model Portfolios on a discretionary basis with a view to ensuring that the Model Portfolios are managed in accordance with the Investment Guidelines indicated in the Agreement, which may be adjusted in the discretion of the Adviser, and that the Adviser is not responsible for taking into consideration the client's circumstances in the management of the Model Portfolios;
(b) No changes to another Model Portfolio --- In the event that a Dealer determines that an investment in a particular Model Portfolio is no longer suitable for a client or no longer puts the client's interest first, and that a different Model Portfolio would be more appropriate for the client, this will be communicated to the client by the Dealer, and the Dealer representative will undertake the analysis described in paragraphs 19, 20 and 21 above and enter into a new Client Agreement, or amendment or new schedule to an existing Client Agreement, before the client's investments are changed to reflect the new Model Portfolio;
(c) KYC, TCP and suitability --- The client will acknowledge that the Know Your Client Requirements, the Trusted Contact Person Requirement, and the Suitability Determination Requirement are not the responsibility of the Adviser, but instead will be that of the Dealer who will gather and periodically update the KYC and TCP information concerning the client and determine, on at least an annual basis, that the selected Model Portfolio continues to be suitable for the client and put the client's interest first;
(d) Weighting Change Trades -- Subject to the notice requirements set out in paragraph 16 above, the client will acknowledge that the Adviser may use its discretion, from time to time, to make decisions regarding Weighting Changes for a Model Portfolio, and will authorize the Dealer to purchase and redeem securities of the Funds in the client's account to reflect such Weighting Changes to the Model Portfolio;
(e) Rebalancing Trades --- The client will acknowledge that the Adviser may from time to time use its discretion to direct an Account Rebalance or a Model Re-allocation, which will be effected through the Dealer (or another appropriately registered Dealer) as Rebalancing Trades;
(f) Fee Redemption Trades --- The client will authorize the Dealer (or another appropriately registered Dealer) to redeem units of the Funds to pay fees owed by the client to the Dealer pursuant to the Client Agreement (the Fee Redemption Trades);
(g) The Adviser will agree, in its Model Portfolio Agreement with each Dealer, to be responsible for ensuring that the Model Portfolios are managed in accordance with the Investment Guidelines agreed to with the Dealer and acknowledged by the client; and
(h) No discretionary authority for the Dealers --- The client will acknowledge that the Dealer will not have discretionary authority to participate in the management of the Model Portfolio or to direct Rebalancing Trades.
40. In addition to the Client Agreement, the client will also be provided by the Dealer:
(a) with the final Investment Policy Statement prior to or concurrently with the execution of the Client Agreement which sets out the Investment Guidelines of the Model Portfolio, the composition of the Model Portfolio and the Funds in the Model Portfolio, the Target Weights, the Permitted Range(s), as well as the fees payable to the Dealer, who will in turn pay fees to the Adviser; and
(b) within two days of trades being implemented for the Model Portfolio, with the Fund Facts and ETF Facts, as applicable, as may be required by applicable securities laws, subject to any applicable exemption available to the Dealer, in respect of the Funds included in the Model Portfolio for a client. In the event that, as part of the Rebalancing Trades, a new replacement Fund is incorporated as part of the Model Portfolio, the client will similarly be provided with the Fund Facts or ETF Facts, as applicable, for the replacement Fund, as may be required by applicable securities laws, subject to any applicable exemption available to the Dealer.
41. The Dealer is responsible for arranging for the execution of the Client Agreement and related materials by the client.
42. Each Dealer will be responsible for providing clients in the Program with account statements, performance reports and any other reports or statements in accordance with the requirements under the Legislation. Such statements of account will identify the assets participating in the Program and invested in accordance with the Model Portfolios.
43. Account opening documents relating to the Program will explain the different responsibilities of the Dealer and the Adviser with respect to the client and the Model Portfolio. This will include disclosure that the Adviser is responsible for managing the Model Portfolio without reference to the client's circumstances and only in accordance with the Model Portfolio selected by the client, and that the Dealer alone will have the responsibility to determine that the selected Model Portfolio is and remains suitable for the client and puts the client's interest first.
44. The Funds that will comprise each Model Portfolio will be held directly by each client in their own account with the Dealer and if the client has not already opened an account with the Dealer, the client will complete an account application.
45. Each Dealer will reflect all Weighting Change Trades, Rebalancing Trades or Fee Redemption Trades in the client's account.
46. Trade confirmations for every transaction in a client's account will be provided to the client by the Dealer in accordance with the requirements under the Legislation.
47. Clients will be able to access their accounts in the manner each Dealer makes its accounts available for its clients.
48. An investment performance report will be sent to each client in the Program by the applicable Dealer on an annual basis.
49. The Dealer will also provide the client with an annual tax reporting package, as applicable.
Oversight and Monitoring
50. The following monitoring and oversight procedures will be carried out in connection with each client's account in the Program:
(a) An annual portfolio review will be conducted by the relevant Dealer representative to determine whether there have been any changes to the client's circumstances, including the client's personal and financial circumstances, investment needs and objectives, risk profile and investment time horizon, that would warrant the selection of another Model Portfolio; and
(b) There will be ongoing oversight of each Model Portfolio by the Adviser's advising representatives to determine whether the composition of the Model Portfolio remains in compliance with its Investment Guidelines and the Adviser's advising representatives will determine from time to time whether any changes to the composition of the Model Portfolio, such as changes to the Funds or Target Weights, would be appropriate.
Exemption Sought
51. Through an Adviser's provision of the Services, and pursuant to, together, the Model Portfolio Consulting Agreement between the Adviser and the applicable Dealer and the Client Agreement between the Dealer and the client, (i) clients that participate in a Program have investment exposure to portfolio management decisions made by the Adviser, and (ii) the Adviser and the Dealer each deliver distinct ongoing registrable services for the benefit of the client, which together comprise the Program.
52. In the absence of the Exemption Sought, an Adviser would therefore be required:
(a) to gather and update the information contemplated by the Know Your Client Requirements and the Trusted Contact Person Requirement for each client in the Program;
(b) to make a suitability determination for each client in the Program in respect of the applicable Model Portfolio(s) and ensure that each trade is suitable for each client in the Program and puts the client's interest first in accordance with the Suitability Determination Requirement, rather than invested in accordance with the Investment Guidelines for the Model Portfolios; and
(c) to deliver account statements and investment performance reports to clients who have invested in accordance with the Model Portfolios in as required by the Statement Delivery Requirement.
53. The Dealers do not require an exemption from the adviser registration requirement under the Legislation as a result of their involvement with the Program, as they will not be engaged in providing discretionary management advice to clients in connection with the management of the Model Portfolios and will be effecting the trades without exercising any discretion.
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted provided that:
(a) the Adviser is, at the time of any client investment in the Program, Rebalancing Trade and Weighting Change Trade, registered under the Legislation as an adviser in the category of portfolio manager;
(b) each Rebalancing Trade and Weighting Change Trade is made in accordance with the Investment Guidelines of the selected Model Portfolio;
(c) each client in a Program is informed in writing:
(i) of the roles, duties and responsibilities of the Adviser and the Dealer, including that:
a. the Adviser will manage the Model Portfolios without reference to the client's circumstances and only in accordance with the terms of each Model Portfolio that is created and maintained by the Adviser pursuant to the Services;
b. the Dealer will be solely responsible for gathering and periodically updating KYC and TCP information concerning the client and confirming, on at least an annual basis, that the selected Model Portfolio continues to be suitable for the client and puts the client's interest first;
(ii) that the client will receive account statements and performance reports from the Dealer, and will not receive account statements and performance reports from the Adviser;
(d) the Adviser will adopt, maintain and apply oversight policies and procedures designed to provide reasonable assurance that each Dealer complies with its KYC, TCP and suitability determination obligations with respect to each client in a Program, including requiring that:
(i) the Dealer not market and sell the Model Portfolios through an order-execution-only, suitability-exempt channel;
(ii) the Dealer notify the Adviser of each instance where a Model Portfolio is sold to a client on the basis of a client-directed trade as contemplated in section 13.3 of NI 31-103 and similar provisions under CIRO rules;
(iii) the Dealer be responsible for gathering and periodically updating KYC and TCP information concerning the client and confirming, on at least an annual basis, that the selected Model Portfolio continues to be suitable for the client and puts the client's interest first;
(iv) the Dealer, on an annual basis, no later than 30 days after the end of the calendar year, provide a certificate to the Adviser that the Dealer has complied with its KYC, TCP and suitability determination obligations with respect to each client in the Program.
(e) the Adviser will adopt, maintain and apply oversight policies and procedures designed to provide reasonable assurance that each Dealer complies with its client reporting obligations in respect of clients in a Program, including requiring that the Dealer, on an annual basis, no later than 30 days after the end of the calendar year, provide a certificate to the Adviser that:
(i) the Dealer has complied with its client reporting obligations under the rules of CIRO, and
(ii) the Dealer has undertaken steps in accordance with its policies and procedures to provide reasonable assurance that account statements and investment performance reports delivered to clients are complete, accurate and delivered on a timely basis in a format that is compliant with the rules of CIRO.
(f) the Adviser will adopt, maintain and apply oversight policies and procedures designed to provide reasonable assurance that each Dealer complies with its obligations in respect of all trading for clients in a Program, including requiring that the Dealer, on an annual basis, no later than 30 days after the end of the calendar year, provide a certificate to the Adviser that the Dealer has effected all trades for clients in a Program in accordance with the selected Model Portfolios as directed by the Adviser; and
(g) the Adviser has a written agreement in place with each Dealer concerning their respective roles, duties and responsibilities to clients in respect of a Program and the Services.
OSC File #: 2025/0394
Assante Capital Management Ltd. and Assante Financial Management Ltd.
Multilateral Instrument 11-102 Passport System, National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions and National Instrument 33-109 Registration Information (NI 33-109) -- relief from certain filing requirements in relation to the bulk transfer of business locations and registered individuals in accordance with section 3.4 of Companion Policy 33-109CP to NI 33-109, as a result of an amalgamation.
December 15, 2025
The principal regulator in the Jurisdiction has received an application from the Filers for a decision under the securities legislation of the Jurisdiction (the Legislation) providing exemptions from the requirements contained in sections 2.2, 2.3, 2.5, 3.2 and 4.2 of National Instrument 33-109 Registration Information (NI 33-109) pursuant to section 7.1 of NI 33-109 to allow the bulk transfer (the Bulk Transfer) of registered individuals (the AFM Individuals) and all business locations (the Locations) of Assante Financial Management Ltd. (AFM) from AFM to Assante Capital Management Ltd. (ACM) on or about January 1, 2026 (the Amalgamation Date), in accordance with section 3.4 of the Companion Policy to NI 33-109 (the Exemption Sought).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission (OSC) is the principal regulator for this application; and
(b) the Filers have provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (collectively, with Ontario, the Jurisdictions).
Terms defined in National Instrument 14-101 Definitions and in MI 11-102 have the same meaning if used in this decision, unless otherwise defined.
This decision is based on the following facts represented by the Filers:
ACM
1. ACM is a wholly-owned subsidiary of Assante Wealth Management (Canada) Ltd. (Assante Wealth), which is wholly-owned by CI Financial Corp.
2. ACM is registered as a mutual fund dealer and investment dealer in each of the Jurisdictions. ACM is a member of the Canadian Investment Regulatory Organization (CIRO) and has its head office in Toronto, Ontario.
3. ACM has approximately 640 registered and permitted individuals.
4. ACM is not in default of securities legislation in any of the Jurisdictions.
AFM
5. AFM is a wholly-owned subsidiary of Assante Wealth.
6. AFM is registered as a mutual fund dealer and exempt market dealer in each of the Jurisdictions. AFM is a member of CIRO and has its head office in Toronto, Ontario.
7. AFM has approximately 550 registered and permitted individuals.
8. AFM is not in default of securities legislation in any of the Jurisdictions.
Amalgamation
9. For various business reasons, on the Amalgamation Date, the Filers intend to amalgamate (the Amalgamation). The Amalgamation will be effected under the Business Corporations Act (Ontario) as a horizontal short form amalgamation. As such, after the Amalgamation, the Filers will continue as a single legal entity with the name "CI Assante Wealth Management Ltd." (the Amalgamated Corporation). There will be no change to the ultimate parent ownership by CI Financial Corp.
10. Both ACM and AFM are registered as a mutual fund dealer in each of the Jurisdictions. ACM is also registered as an investment dealer in each of the Jurisdictions. AFM is registered as an exempt market dealer in each of the Jurisdictions. The Amalgamated Corporation will be registered as an investment dealer, mutual fund dealer and exempt market dealer in each of the Jurisdictions. The Amalgamation will allow the Amalgamated Corporation to integrate all registrations and operate as a single platform.
11. The clients of both ACM and AFM were provided with notification of the Amalgamation with their third-quarter account statements.
12. The head office of the Amalgamated Corporation will be the same as the current head office location of the Filers.
13. The principal regulator of the Amalgamated Corporation will be the OSC.
14. The Filers do not anticipate any other material changes in their primary business activities, target markets or products and services as a result of the Amalgamation.
15. The Amalgamated Corporation will carry on under the registration of ACM. Accordingly, the registrations of all AFM Individuals must be transferred to the Amalgamated Corporation effective on the Amalgamation Date. Additionally, the Locations of AFM must be transferred to the Amalgamated Corporation effective on the Amalgamation Date.
Submissions in support of the exemption
16. Effective as of the Amalgamation Date, all activities currently conducted by the Filers will be under the responsibility of the Amalgamated Corporation. The Amalgamated Corporation will conduct the same business operations, in substantially the same manner and with essentially the same personnel as the Filers did before the Amalgamation.
17. The Amalgamated Corporation will have the necessary resources to ensure compliance with Canadian securities law.
18. Subject to obtaining the Exemption Sought, no disruption in the services provided by the AFM Individuals to clients of AFM is anticipated as a result of the Bulk Transfer.
19. The Exemption Sought will not be prejudicial to the public interest and will not have any negative consequences on the ability of the Filers or the Amalgamated Corporation to comply with any applicable regulatory requirements or their ability to satisfy any of their obligations in respect of their clients.
20. Given the number of AFM Individuals and Locations to be transferred from AFM to the Amalgamated Corporation on the Amalgamation Date, it would be unduly time-consuming and difficult to transfer each of the AFM Individuals and Locations through the National Registration Database in accordance with the requirements of NI 33-109 if the Exemption Sought is not granted.
21. The Amalgamated Corporation's registration categories will encompass the registration categories and Jurisdictions of each of the Filers immediately prior to the Amalgamation, which will provide the opportunity to seamlessly transfer the AFM Individuals and Locations to the Amalgamated Corporation by way of Bulk Transfer.
22. Allowing the Bulk Transfer of the AFM Individuals to occur on the Amalgamation Date will benefit (and have no detrimental impact on) the clients of the Filers by facilitating seamless service on the part of the AFM Individuals, the Filers and the Amalgamated Corporation.
23. The Exemption Sought provides the information and satisfies the conditions for a bulk transfer as set out in Section 3.4 of the Companion Policy to NI 33-109 and Appendix D thereto.
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted.
Application File #: 2025/0181
Multilateral Instrument 11-102 Passport System and National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Issuer bid -- Modified Dutch auction -- Application for relief from the requirement to take-up and pay for shares on a pro rata basis and the related disclosure requirements for the issuer bid circular (section 2.26 of National Instrument 62-104 Take-Over Bids and Issuer Bids and item 8 of Form 62-104F2) -- Application for relief from the requirement to take-up all securities deposited under the issuer bid and not withdrawn if all the terms and conditions of the Offer have been complied with or waived and the Offer is under subscribed (subsection 2.32(4) of National Instrument 62-104 Take-Over Bids and Issuer Bids) -- requested relief granted, subject to conditions.
National Instrument 62-104 Take-Over Bids and Issuer Bids, ss. 2.26, 2.32(4) and 6.1 and item 8 of Form 62 104F2.
December 12, 2025
The principal regulator in the Jurisdiction has received an application from the Filer for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation), in connection with the proposed purchase by the Filer of a portion of its outstanding common shares (the Shares) pursuant to an issuer bid (the Offer), for an exemption, subject to the conditions set forth herein, from the following requirements (the Exemption Sought):
(a) the requirement in Section 2.26 of National Instrument 62-104 -- Take-Over Bids and Issuer Bids (NI 62-104) to take up and pay for Shares deposited pursuant to the Offer proportionately according to the number of Shares deposited by each holder (each, a Shareholder, and collectively, the Shareholders) of Shares (the Proportionate Take Up Requirement);
(b) the requirement in Item 8 of Form 62-104F2 -- Issuer Bid Circular (Form 62-104F2) to provide disclosure of the proportionate take up and payment of Shares under the Offer in the Filer's issuer bid circular (such circular collectively with the offer to purchase in respect of the Offer, the Circular) (the Proportionate Take Up Disclosure Requirement); and
(c) the requirement in Section 2.32(4) of NI 62-104 that an issuer bid not be extended if all the terms and conditions of the issuer bid have been complied with or waived unless the issuer first takes up all securities deposited under the issuer bid and not withdrawn (collectively, the Extension Take Up Requirement).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application; and
(b) the Filer has provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 -- Passport System (MI 11-102) is intended to be relied upon in British Columbia, Alberta, Québec, Saskatchewan, Manitoba, New Brunswick, Nova Scotia, Newfoundland and Labrador, Prince Edward Island, the Northwest Territories, Yukon and Nunavut.
Terms defined in National Instrument 14-101 -- Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined herein.
This decision is based on the following facts represented by the Filer:
1. The Filer is a corporation validly existing under the Business Corporations Act (Ontario) and is in good standing.
2. The head office and registered office of the Filer is located at 33 Yonge Street, Suite 500, Toronto, Ontario, M5E 1G4.
3. The Filer is a reporting issuer in each of the jurisdictions of Canada and the Shares are listed for trading on the Toronto Stock Exchange (the TSX) under the symbol "AIF". The Filer is not in default of any requirement of the securities legislation in any jurisdiction in which it is a reporting issuer.
4. The Filer's authorized share capital consists of (a) an unlimited number of Shares, and (b) an unlimited number of preferred shares, issuable in series. As of November 25, 2025, 43,222,129 Shares (net of 79,328 escrowed Shares), and no preferred shares, were issued and outstanding.
5. On November 20, 2025, the Filer announced via press release its intention to make the Offer, and indicated that it expects to commence the Offer on or about November 26, 2025.
6. On November 19, 2025, the last trading day prior to the Filer's announcement of its intention to make the Offer, the closing price of the Shares on the TSX was C$49.80. On the basis of this closing price, on such date the Shares had an aggregate market value of approximately C$2,150,214,251.40 (on a non-diluted basis).
7. The Filer commenced the Offer on November 26, 2025. Pursuant to the Offer, the Filer offers to purchase that number of Shares having an aggregate maximum purchase price of C$350,000,000 (the Specified Maximum Dollar Amount).
8. On November 25, 2025, the board of directors of the Filer (the Board) determined that the Offer is in the best interests of the Filer and Shareholders given, among other things, its significant level of cash on hand, stable financial profile, and the current market price of the Shares, which the Board believes does not currently reflect the fundamental value of the Filer. The Offer allows the Filer to return up to C$350,000,000 of capital to Shareholders who elect to tender their Shares, while at the same time increasing the proportionate equity ownership of Shareholders who elect not to tender.
9. The purchase price per Share (the Purchase Price) will be determined by the Filer through a modified "Dutch auction" procedure in the manner described below, but will not be less than C$50.00 and not more than C$57.00 per Share (the Price Range).
10. The Offer is made only for Shares and is not made for any convertible, exercisable or exchangeable securities. Pursuant to subsection 2.8(b) of NI 62-104, the Filer also made the Offer to each holder of convertible, exercisable or exchangeable securities that, before the expiry of the deposit period of the Offer, are convertible into, exercisable for or exchangeable for Shares. Such convertible, exercisable or exchangeable securities may, at the option of the holder, be converted, exercised or exchanged for Shares in accordance with the terms of such securities prior to the expiry of the deposit period of the Offer. Shares issued upon the conversion, exercise or exchange of the convertible, exercisable or exchangeable securities may be tendered to the Offer in accordance with the terms of the Offer.
11. Both the Specified Maximum Dollar Amount and the Price Range are specified in the Circular dated November 26, 2025.
12. The Filer will fund the purchase of Shares pursuant to the Offer, together with the fees and expenses of the Offer, using available cash on hand. The Offer is not conditional upon the receipt of financing.
13. A Shareholder wishing to tender to the Offer will be able to do so in the following ways:
(a) by making an auction tender (an Auction Tender) pursuant to which it agrees to tender to the Filer, at a specified price per Share (an Auction Price), a specified number of Shares, within the Price Range in increments of C$0.25 per Share;
(b) by making a purchase price tender (a Purchase Price Tender) pursuant to which it does not specify a price per Share, but rather agrees to have a specified number of Shares purchased by the Filer at the Purchase Price; or
(c) by making a proportionate tender (a Proportionate Tender) in which the tendering Shareholder tenders all of the Shares held by such Shareholder, at the Purchase Price to be determined pursuant to the Offer, on the basis that the Filer will only purchase such number of Shares so tendered that will result in the Shareholder maintaining its proportionate Share ownership in the Filer following the completion of the Offer.
14. A Shareholder may make both an Auction Tender and a Purchase Price Tender, but not in respect of the same Shares. A Shareholder who tenders Shares in an Auction Tender and/or a Purchase Price Tender cannot tender Shares in a Proportionate Tender. Shareholders may also make multiple Auction Tenders at different Auction Prices, but not in respect of the same Shares (i.e., Shareholders may tender different Shares at different prices, but cannot tender the same Shares at different prices). Shareholders making Auction Tenders or Purchase Price Tenders may tender less than all of their Shares to the Offer. Shareholders who tender Shares in a Proportionate Tender may not tender Shares in an Auction Tender or a Purchase Price Tender.
15. A registered Shareholder who makes a Proportionate Tender must deposit all of its Shares. A non-registered Shareholder who wishes its nominee to make a Proportionate Tender must deposit all of its Shares.
16. A Shareholder who properly tenders Shares without specifying the method in which it is tendering its Shares, or who makes an invalid Proportionate Tender, will be deemed to have made a Purchase Price Tender.
17. Any Shareholder who owns fewer than 100 Shares and tenders all of such Shareholder's Shares pursuant to an Auction Tender at or below the Purchase Price or pursuant to a Purchase Price Tender will be considered to have made an Odd Lot Tender.
18. Promptly after the expiry of the Offer, the Filer will determine the Purchase Price based on the Auction Prices and the number of Shares deposited pursuant to valid Auction Tenders and Purchase Price Tenders (considered for purposes of determining the Purchase Price to have been tendered at the minimum Purchase Price within the Price Range). The Purchase Price will be the lowest price per Share that enables the Filer to purchase all of the Shares collectively tendered pursuant to Auction Tenders at Auction Prices less than or equal to that price and Purchase Price Tenders, having an aggregate Purchase Price that does not exceed the Auction Tender Limit Amount (as defined below); provided that if the aggregate purchase price for Shares collectively tendered pursuant to Auction Tenders at Auction Prices equal to the minimum Purchase Price within the Price Range and Purchase Price Tenders exceeds the Auction Tender Limit Amount, the Purchase Price will be the minimum Purchase Price within the Price Range. The term Auction Tender Limit Amount means the amount equal to: (a) the Specified Maximum Dollar Amount, less (b) the product of: (i) the Specified Maximum Dollar Amount; and (ii) a fraction, the numerator of which is the aggregate number of Shares owned by Shareholders making valid Proportionate Tenders, and the denominator of which is the aggregate number of Shares outstanding at the time of expiry of the Offer.
19. If the aggregate purchase price (the Auction Tender Purchase Amount) for Shares validly tendered and not properly withdrawn pursuant to, collectively, Auction Tenders at Auction Prices at or below the Purchase Price and Purchase Price Tenders is less than or equal to the Auction Tender Limit Amount, the Filer will purchase, at the Purchase Price, all Shares so tendered pursuant to Purchase Price Tenders and Auction Tenders at or below the Purchase Price.
20. If the Auction Tender Purchase Amount is greater than the Auction Tender Limit Amount, the Filer will purchase a portion of the Shares so tendered pursuant to Purchase Price Tenders and Auction Tenders at or below the Purchase Price, as follows: (a) first, the Filer will purchase all Shares tendered at or below the Purchase Price pursuant to Odd Lot Tenders, at the Purchase Price; and (b) second, the Filer will purchase at the Purchase Price, on a pro rata basis, that portion of the Shares tendered pursuant to Purchase Price Tenders and Auction Tenders at or below the Purchase Price having an aggregate purchase price, based on the Purchase Price, equal to: (i) the Auction Tender Limit Amount, less (ii) the aggregate amount paid by the Filer for Shares tendered pursuant to Odd Lot Tenders, in each case as set forth in clauses (a) and (b) above.
21. The Filer will purchase at the Purchase Price that portion of the Shares deposited by Shareholders making valid Proportionate Tenders that results in each tendering Shareholder maintaining their proportionate Share ownership following completion of the Offer.
22. The number of Shares that the Filer will purchase pursuant to the Offer and the aggregate purchase price will vary depending on whether the Auction Tender Purchase Amount is equal to or less than the Auction Tender Limit Amount. If the Auction Tender Purchase Amount is less than the Auction Tender Limit Amount, the Filer will purchase proportionately fewer Shares in the aggregate and, accordingly, there will be a proportionately lower aggregate purchase price.
23. If the Purchase Price is determined to be C$50.00 (being the minimum Purchase Price under the Offer), the maximum number of Shares that may be purchased by the Filer under the Offer is 7,000,000 Shares representing approximately 16.20% of the total number of issued and outstanding Shares as of November 25, 2025. If the Purchase Price is determined to be C$57.00 (being the maximum Purchase Price under the Offer), the maximum number of Shares that may be purchased by the Filer under the Offer is 6,140,350 Shares representing approximately 14.21% of the total number of issued and outstanding Shares as of November 25, 2025.
24. All Shares purchased by the Filer pursuant to the Offer (including Shares tendered at Auction Prices at or below the Purchase Price) will be purchased at the Purchase Price. Shareholders will receive the Purchase Price in cash. All Auction Tenders, Purchase Price Tenders and Proportionate Tenders will be subject to adjustment to avoid the purchase of fractional Shares (rounding down to the nearest whole number of Shares). All payments to Shareholders will be subject to deduction of applicable withholding taxes.
25. Shares validly deposited by a Shareholder pursuant to an Auction Tender will not be purchased by the Filer pursuant to the Offer if the Auction Price per Share specified by the Shareholder is greater than the Purchase Price. After the expiry of the deposit period of the Offer, the Filer will not extend the Offer if all terms and conditions of the Offer have been complied with or waived by the Filer and the aggregate Purchase Price is equal to or greater than the Specified Maximum Dollar Amount.
26. All Shares tendered to the Offer and not taken up will be returned to the appropriate Shareholders.
27. All deposited Shares not purchased under the Offer (including Shares deposited pursuant to Auction Tenders at prices in excess of the Purchase Price, Shares not purchased because of proration and Shares not accepted for purchase), or properly withdrawn before the Expiration Date (as defined below), will be returned or replaced (in the case of tenders where only a partial number of the tendered Shares are purchased) promptly after the Expiration Date or termination of the Offer or the date of proper withdrawal of the Shares, without expense to the Shareholder. In the case of Shares tendered through book-entry transfer, such Shares will be credited to the appropriate account, without expense to the Shareholder.
28. Until expiry of the Offer, all information about the number of Shares tendered and the prices at which the Shares are tendered will be required to be kept confidential by the depositary and the Filer until the Purchase Price has been determined.
29. Shareholders who do not accept the Offer will continue to hold the number of Shares owned before the Offer and their proportionate Share ownership will increase following completion of the Offer.
30. To the knowledge of the Filer, Jarislowsky Fraser Global Investment Management, a division of 1832 Asset Management L.P. (Jarislowsky) beneficially owns, controls or exercises control or direction over 5,701,547 Shares (representing approximately 13.19% of the issued and outstanding Shares as of November 25, 2025).
31. Jarislowsky has advised the Filer that it intends to tender all of its Shares to the Offer in the form of a Proportionate Tender, such that following the completion of the Offer, Jarislowsky's proportionate ownership of the Shares will remain the same as it was prior to completion of the Offer. The number of Shares that Jarislowsky is expected to own following completion of the Offer will be such number of Shares as is equivalent to approximately 13.19% of the Shares outstanding following completion of the Offer.
32. To the knowledge of the Filer, after reasonable inquiry, no person or company other than Jarislowsky beneficially owns, or exercises control or direction over, more than 10% of the voting rights attached to all of the issued and outstanding Shares.
33. As of November 26, 2025, to the knowledge of the Filer and its directors and officers after reasonable inquiry, no director or officer of the Filer, no insider of the Filer other than a director or officer of the Filer (other than Jarislowsky), no associate or affiliate of the Filer or of an insider of the Filer, and no person or company acting jointly or in concert with the Filer, has indicated any present intention to deposit any of such person's or company's Shares pursuant to the Offer.
34. The Offer is scheduled to expire at 5:00 p.m. (Toronto time) on January 8, 2026 (the Expiration Date).
35. If all of the terms and conditions of the Offer have been complied with or waived by the Filer by the Expiration Date, but the Auction Tender Purchase Amount is less than the Auction Tender Limit Amount (which amount shall never exceed the Specified Maximum Dollar Amount for Shares validly tendered pursuant to any method under the Offer), the Filer may wish to extend the Offer without first taking up all the Shares deposited and not withdrawn under the Offer. Under the Extension Take Up Requirement, an issuer may not extend an issuer bid if all the terms and conditions of the issuer bid have been complied with or waived unless the issuer first takes up all the securities deposited and not withdrawn under the issuer bid.
36. As the determination of the Purchase Price requires that all Auction Prices and the number of Shares deposited pursuant to both Auction Tenders and Purchase Price Tenders be known and taken into account, the Filer will be unable to take up the Shares deposited and not withdrawn under the Offer as of the Expiration Date prior to extending the Offer because the Purchase Price will not and cannot be known as additional Auction Tenders and Purchase Price Tenders may be made during the extension period that will impact the calculation of the Purchase Price. Accordingly, relief from the Extension Take Up Requirement is required in connection with an extension of the Offer to enable the Filer to make a final determination regarding the Purchase Price, taking into account all Shares tendered prior to the Expiration Date and those tendered during any extension period.
37. Shares deposited pursuant to the Offer, including those deposited prior to the Expiration Date, may be withdrawn by the Shareholder at any time prior to the expiration of any extension period in respect of the Offer.
38. The Filer is relying on the exemption from the formal valuation requirements applicable to issuer bids under Multilateral Instrument 61-101 -- Protection of Minority Security Holders in Special Transactions (MI 61-101) set out in subsection 3.4(b) of MI 61-101 (the Liquid Market Exemption).
39. There was a "liquid market" for the Shares, as such term is defined in MI 61-101, as of the date of the commencement of the Offer because, in accordance with paragraph 1.2(1)(a) of MI 61-101:
(a) there was a published market for the Shares (being the TSX);
(b) during the 12 months before November 19, 2025 (the last full trading day before announcement of the intention to make the Offer):
(i) the number of issued and outstanding Shares was at all times at least 5,000,000 (excluding Shares beneficially owned, or over which control or direction was exercised, by related parties and securities that were not freely tradable), all of which Shares were freely tradable;
(ii) the aggregate trading volume of Shares on the TSX (the exchange on which the Shares were principally traded) was at least 1,000,000 Shares;
(iii) there were at least 1,000 trades in the Shares in the TSX; and
(iv) the aggregate of the value of the trades on the TSX was at least C$15,000,000; and
(c) the market value of the Shares on the TSX, as determined in accordance with MI 61-101, was at least $75,000,000 for October 2025 (the calendar month preceding the calendar month in which the Offer was announced).
40. ln addition, an opinion was voluntarily sought by the Filer and obtained from RBC Dominion Securities Inc. confirming that a liquid market existed for the Shares as of November 24, 2025 and that it is reasonable to conclude that, following the completion of the Offer, there will be a market for Shareholders who do not tender to the Offer that is not materially less liquid than the market that existed at the time of the making of the Offer (the Liquidity Opinion). A copy of the Liquidity Opinion is attached to the Circular.
41. Based on the maximum number of Shares that may be purchased under the Offer and the Liquidity Opinion, the Board has determined that it is reasonable to conclude that, following the completion of the Offer in accordance with its terms, there will be a market for holders of the Shares who do not tender to the Offer that is not materially less "liquid", as such term is defined in MI 61-101, than the market that existed on the date of the commencement of the Offer.
42. The Circular:
(a) discloses the mechanics for the take up of and payment for Shares as described herein;
(b) explains that, by tendering Shares at the lowest price in the Price Range under an Auction Tender or by tendering Shares under a Purchase Price Tender or Proportionate Tender, a Shareholder can reasonably expect that the Shares so tendered will be purchased at the Purchase Price, subject to proration and other terms of the Offer as specified therein;
(c) explains the manner in which the Purchase Price will be determined pursuant to the Offer and the process for which Shares will either be taken up or returned to Shareholders in accordance with the terms of the Offer;
(d) discloses that the Filer has applied for, or has then obtained, as the case may be, the Exemption Sought (or any aspect thereof);
(e) sets out the manner in which an extension of the Offer will be communicated to Shareholders;
(f) discloses that Shares deposited pursuant to the Offer may be withdrawn at any time prior to the expiry of the Offer;
(g) discloses, to the extent known after reasonable inquiry, the name of every person named in Item 11 of Form 62-104F2 who has accepted or intends to accept the Offer and the number of Shares in respect of which the person has accepted or intends to accept the Offer;
(h) discloses the facts supporting the Filer's reliance on the Liquid Market Exemption and attaches a copy of the Liquidity Opinion; and
(i) except to the extent exemptive relief is granted further to the Exemption Sought from the Proportionate Take Up Disclosure Requirement, contains the disclosure prescribed by applicable securities laws for issuer bids.
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted provided that:
(a) the Filer takes up Shares deposited pursuant to the Offer and not withdrawn and pays for such Shares, in each case, in the manner described herein and as set out in the Circular;
(b) the Filer is eligible to rely on the Liquid Market Exemption;
(c) the Filer complies with the applicable requirements of Regulation 14E promulgated under the 1934 Act in respect of the Offer; and
(d) the Filer will issue and file a press release announcing receipt of the Exemption Sought promptly, and in any case, no later than one (1) business day following receipt of the Exemption Sought.
OSC File #: 2025/00697
Pursuant to National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103) -- relief from the requirements in section 11.2 of NI 31-103 to designate one individual as ultimate designated person (UDP), such that the Filer may instead be permitted to designate two individuals as UDPs in respect of each Filer's distinct operating divisions.
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions, s. 5.4.
Multilateral Instrument 11-102 Passport System, s. 4.7(1).
National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations, ss. 11.2 and 15.1.
[Original text in French]
December 1, 2025
The securities regulatory authority or regulator in each of the Jurisdictions ("Decision Maker") has received an application from the Filer for a decision under the securities legislation of the Jurisdictions (the "Legislation") for relief, pursuant to section 15.1 of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations ("NI 31-103"), from the requirement contained in section 11.2 of NI 31-103 to designate an individual to be the ultimate designated person ("UDP"), in order to permit the Filer to designate and register two individuals as UPDs in respect of two distinct business units of the Filer (the "Exemption Sought").
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a dual application):
(a) the Autorité des marchés financiers is the principal regulator for this application;
(b) the Filer has provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 Passport System ("MI 11-102") is intended to be relied upon in all of the provinces and territories of Canada other than Québec and Ontario; and
(c) the decision is the decision of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.
Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined.
"Institutional Client" in this decision has the meaning ascribed to it in Rule 1201 of the Canadian Investment Regulatory Organization ("CIRO") Investment Dealer and Partially Consolidated ("IDPC") Rules, which includes a Hedger who requests and consents to being classified as an Institutional Client for accounts with qualifying hedging activities and positions.
"Retail Client" in this decision has the meaning ascribed to it in Rule 1201 of the CIRO IDPC Rules, which refers to client that is not an Institutional Client
This decision is based on the following facts represented by the Filer:
1. The Filer is a corporation incorporated under the laws of Canada with its head office located in Montréal, Québec.
2. The Filer is registered as (i) an investment dealer in all provinces and territories of Canada and (ii) a mutual fund dealer in all provinces and territories of Canada; and (iii) a derivatives dealer in Québec. The Filer is a dealer member of the CIRO.
3. The Filer is not in default of any of the requirements of the securities legislation in any jurisdiction of Canada.
Operational Structure
4. The Filer operates two distinct operating business units based on the nature of services provided with one a retail division ("Retail Division") and the other a capital markets division ("Capital Markets Division") (together the "Divisions"). Each Division offers services to distinct clients for distinct reasons, as set out below.
The Filer
(a) iA Private Wealth has a Retail Division of registered Portfolio Managers ("PMs") and Registered Representatives ("RRs") and it offers comprehensive, tailored wealth management solutions for Retail Clients, as defined in CIRO IDPC Rule 1201. Investments that can be made through the Filer's Retail Division include stocks, bonds, mutual funds, ETFs and alternative investments (where suitable) serviced through a PM or RR.
iA Private Wealth has a Capital Markets Division, which currently offers three main lines of business:
i. Equity Capital Markets offers investment banking services including advisory and underwriting of equity, debt, and structured products securities; the distribution of equity, debt, and structured products securities; and equity, exchange traded funds, and options trading services and provides support to the Filer's RRs and PMs to help them service their own clients.
ii. The Bond Desk manages its proprietary inventory of bonds and offers fixed income trading services as well as offering tailored fixed income portfolio construction solutions to the Filer's RRs and PMs to help them service their own clients.
iii. The FX Desk offers FX risk management and hedging solutions, FX derivatives trading, and FX spot trading services to Institutional Clients and accredited investors that are corporations.
(b) The Capital Markets Division has a dedicated team of 29 employees. Of the 29 employees, 13 are RRs in the following categories (please note some RRs are registered in multiple categories): eight Securities -- Institutional, three Securities -- Retail, two Traders, five Options and one Portfolio Manager Securities -- Retail. The Capital Markets Division does not promote its services to Retail Clients as part of its business model. The 'Retail' registrations are necessary for the FX Desk to service accredited investors that are corporations that do not meet the Institutional Client definition as well as a few remaining legacy accounts for Institutional Client executives.
5. Each Division functions independently within the Filer and has separate and distinct senior management.
6. Currently, the Divisions share the same UDP. The Filer's UDP, who is the President and CEO, has ultimate responsibility and oversight of the Retail Division and Capital Markets Division, and reports to the Executive Vice President of iA Wealth.
7. The Senior Vice President & Head, Investment Products & Solutions and Capital Markets, iA Wealth/Directrice Générale principale & Chef, Solutions d'investissement & produits et Marchés des capitaux, iA Gestion de patrimoine ("SVP"), appointed in January 2025, is now ultimately responsible for oversight of Capital Markets Division. The SVP, like the Filer's CEO, reports directly to the Executive Vice President of iA Wealth.
8. If the Exemption Sought is granted, the Filer intends to have two UDPs. Each Division will have an internal corporate governance structure that is led by the most senior officer of their Division (each a "Division Head"). Each Division Head will be designated and registered as UDP for their respective Division.
9. The Division Heads, regardless of their title from time to time, will each have the role that is the functional equivalent of a chief executive officer in respect of the Division for which they are responsible and will be the most senior and final decision maker for their Division. This means that each UDP fulfills the following roles for their respective Division:
(a) supervises, oversees and otherwise is responsible for running the Division;
(b) provides clear leadership and promotes a culture of compliance within the Division;
(c) implements the objectives, strategy and plans for the Division;
(d) is accountable for the operations and financial performance of the Division;
(e) is the individual that the executive management within the Division report to;
(f) is accountable for reporting at least annually to the Board of Directors of the Filer (the "Board") with respect to the Division;
(g) promotes compliance with industry rules and applicable securities laws;
(h) supervises the activities of the Filer directed toward ensuring compliance with industry rules and applicable securities law requirements;
(i) is responsible for the overall conduct of and supervision of its employees;
(j) ensures that supervisory policies and procedures are developed and implemented and adequately reflect the regulatory requirements, and;
(k) has ultimate authority over compliance-related matters for the Division.
10. There will be no line of reporting between the Division Heads. Each Division Head will have direct access to the Board and will report independently to the Board in respect of the Division for which they are responsible.
11. No other executive officer of the Filer will have the authority to overrule a decision of the applicable Division Head or control either of the Division Head's access to the Board. For clarity, neither Division Head will have the authority to overrule a decision of the other Division Head in connection with the Division over which that person is not the division head.
12. The Filer's compliance team will continue to be led by the current CCO, who will have direct access to each UDP and the Board. The CCO will have sufficient time and resources to oversee compliance for each Division and already supervise the activities of both iAPW divisions.
13. Under section 11.2 of NI 31-103, and CIRO Rule 2507, a registered firm is required to designate and have registered an individual to be the UDP ("UDP Requirement"). The UDP must be:
(a) the chief executive officer of the registered firm or, if the firm does not have a chief executive officer, an individual acting in a capacity similar to a chief executive officer;
(b) the sole proprietor of the registered firm; or
(c) an officer in charge of a division of the registered firm, if the activity that requires the firm to register occurs only in the division and the firm has significant other business activities.
Applications to designate and register UDPs must be submitted pursuant to the process set out in National Instrument 33-109 Registration Information.
14. Granting the Exemption Sought would be consistent with the policy objectives that the UDP Requirement is intended to achieve because:
(a) the Divisions are independent operations that are distinct from each other; and
(b) the Division Heads shall be the most senior executive members of their respective Divisions.
15. Granting the Exemption Sought will allow the Filer to operate with enhanced compliance effectiveness, since one UDP would not be required to divide their time between the compliance oversight of two Divisions, including one Division over which they are not the ultimate decision maker. Granting the Exemption Sought will also increase the UDP's ability to respond quickly to address the Filer's compliance needs.
16. Accordingly, the Filer submits that aligning the UDPs and the compliance structure with the Filer's business model would be effective in fulfilling the policy objectives of the UDP Requirement and will facilitate maintaining an effective compliance program.
Each of the Decision Makers is satisfied that the decision meets the test set out in the Legislation for the Decision Makers to make the decision.
The decision of the Decision Makers under the Legislation is that the Exemption Sought is granted provided that:
(a) Each Division will have its own UDP, who will be the most senior executive officer of the Division for which he or she is appointed as UDP;
(b) Only one individual will be the UDP of each Division;
(c) Each UDP has direct access to the Board; and
(d) Each UDP fulfills the responsibilities set out in section 5.1 of NI 31-103, or any successor provision thereto, in respect of the Division for which he or she is designated as UDP.
OSC File #: 2025/0081
Temporary, Permanent & Rescinding Issuer Cease Trading Orders
Company Name |
Date of Temporary Order |
Date of Hearing |
Date of Permanent Order |
Date of Lapse/Revoke |
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THERE IS NOTHING TO REPORT THIS WEEK. |
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Company Name |
Date of Order |
Date of Revocation |
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Dye & Durham Limited |
December 15, 2025 |
__________ |
Temporary, Permanent & Rescinding Management Cease Trading Orders
Company Name |
Date of Order |
Date of Lapse |
|
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Dye & Durham Limited |
September 30, 2025 |
December 15, 2025 |
Outstanding Management & Insider Cease Trading Orders
Company Name |
Date of Order or Temporary Order |
Date of Hearing |
Date of Permanent Order |
Date of Lapse/Expire |
Date of Issuer Temporary Order |
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Performance Sports Group Ltd. |
19 October 2016 |
31 October 2016 |
31 October 2016 |
__________ |
__________ |
Company Name |
Date of Order |
Date of Lapse |
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Agrios Global Holdings Ltd. |
September 17, 2020 |
__________ |
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Sproutly Canada, Inc. |
June 30, 2022 |
__________ |
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iMining Technologies Inc. |
September 30, 2022 |
__________ |
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Alkaline Fuel Cell Power Corp. |
April 4, 2023 |
__________ |
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mCloud Technologies Corp. |
April 5, 2023 |
__________ |
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FenixOro Gold Corp. |
July 5, 2023 |
__________ |
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HAVN Life Sciences Inc. |
August 30, 2023 |
__________ |
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Perk Labs Inc. |
April 4, 2024 |
__________ |
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Dye & Durham Limited |
September 30, 2025 |
December 15, 2025 |
Issuer Name:
Type and Date:
Offering Price and Description:
Underwriter(s) or Distributor(s):
Promoter(s):
Filing #06374613
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Issuer Name:
Type and Date:
Offering Price and Description:
Underwriter(s) or Distributor(s):
Promoter(s):
Filing #06373403
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Issuer Name:
Type and Date:
Offering Price and Description:
Underwriter(s) or Distributor(s):
Promoter(s):
Filing #06350465
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Issuer Name:
Type and Date:
Offering Price and Description:
Underwriter(s) or Distributor(s):
Promoter(s):
Filing #06373457
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Issuer Name:
Type and Date:
Offering Price and Description:
Underwriter(s) or Distributor(s):
Promoter(s):
Filing #06271214
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Issuer Name:
Type and Date:
Offering Price and Description:
Underwriter(s) or Distributor(s):
Promoter(s):
Filing #06374868
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Issuer Name:
Type and Date:
Offering Price and Description:
Underwriter(s) or Distributor(s):
Promoter(s):
Filing #06374852
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Issuer Name:
Type and Date:
Offering Price and Description:
Underwriter(s) or Distributor(s):
Promoter(s):
Filing #06373544
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Issuer Name:
Type and Date:
Offering Price and Description:
Underwriter(s) or Distributor(s):
Promoter(s):
Filing #06351638
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Issuer Name:
Principal Regulator -- Ontario
Type and Date:
Offering Price and Description:
Filing # 06373620
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Issuer Name:
Principal Regulator -- Ontario
Type and Date:
Offering Price and Description:
Filing # 06370760
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Issuer Name:
Principal Regulator -- Ontario
Type and Date:
Offering Price and Description:
Filing # 06336024
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Issuer Name:
Principal Regulator -- Ontario
Type and Date:
Offering Price and Description:
Filing # 06373240
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Issuer Name:
Principal Regulator -- Alberta
Type and Date:
Offering Price and Description:
Filing # 06370768
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Issuer Name:
Principal Regulator -- British Columbia
Type and Date:
Offering Price and Description:
Filing # 06371529
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Issuer Name:
Principal Regulator -- Ontario
Type and Date:
Offering Price and Description:
Filing # 06373158
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Issuer Name:
Principal Regulator -- Ontario
Type and Date:
Offering Price and Description:
Filing # 06373525
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Issuer Name:
Principal Regulator -- Ontario
Type and Date:
Offering Price and Description:
Filing # 06368851
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Issuer Name:
Principal Regulator -- Alberta
Type and Date:
Offering Price and Description:
Filing # 06337472
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Issuer Name:
Principal Regulator -- British Columbia
Type and Date:
Offering Price and Description:
Filing # 06192983
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Type |
Company |
Category of Registration |
Effective Date |
|
|||
Voluntary Surrender |
CONSTELLATION INVESTIMENTOS E PARTICIPAÇÕES LTDA. |
Portfolio Manager |
December 10, 2025 |
|
|||
Consent to Suspension (Pending Surrender) |
Glidepath Portfolio Services Inc. |
Portfolio Manager |
December 11, 2025 |
|
|||
Consent to Suspension (Pending Surrender) |
EQUILIBRIUM CAPITAL MANAGEMENT INC. / GESTION DE CAPITAL EQUILIBRIUM |
Investment Fund Manager, Portfolio Manager and Exempt Market Dealer |
December 12, 2025 |
|
|||
Consent to Suspension (Pending Surrender) |
Welch Capital Partners Corporate Finance Inc. |
Exempt Market Dealer |
December 12, 2025 |
|
|||
Consent to Suspension (Pending Surrender) |
Hosper Capital Corp. |
Exempt Market Dealer |
December 12, 2025 |
|
|||
Consent to Suspension (Pending Surrender) |
GREYCOURT & CO., INC. |
Portfolio Manager |
December 12, 2025 |
|
|||
Voluntary Surrender |
Matson Money, Inc. |
Portfolio Manager |
December 12, 2025 |
|
|||
Consent to Suspension (Pending Surrender) |
Farber Securities Inc. |
Exempt Market Dealer |
December 12, 2025 |
|
|||
Consent to Suspension (Pending Surrender) |
Fisgard Asset Management Corporation |
Exempt Market Dealer |
December 12, 2025 |
|
|||
Consent to Suspension (Pending Surrender) |
Guiker Financial Services Inc. |
Exempt Market Dealer |
December 15, 2025 |
|
|||
Voluntary Surrender |
Strand Securities Corporation |
Exempt Market Dealer |
December 15, 2025 |
Canadian Investment Regulatory Organization (CIRO) -- Amendments to UMIR Respecting Trading Increments -- Notice of Commission Approval
The Ontario Securities Commission has approved CIRO's proposed amendments to the Universal Market Integrity Rules (UMIR) respecting trading increments (Amendments) to align Canadian trading increments with those in the United States for certain U.S. inter-listed securities.
Specifically, the Amendments:
• distinguish between the applicable trading increment for a "U.S. inter-listed security" and a security that is not a "U.S. inter-listed security", and
• establish that the applicable trading increment for a "U.S. inter-listed security" will be designated by CIRO from time to time.
CIRO published the Amendments for comment on December 12, 2024. Five comment letters were received. A summary of comments received and CIRO's responses was provided in the CIRO Approval Bulletin and no changes were made to the Amendments.
A copy of the CIRO Approval Bulletin, including text of the Amendments, can be found at www.osc.ca.
The Amendments will be effective on November 2, 2026, in alignment with the revised compliance date for the Rule 612 Amendments established by the exemptive order issued by the SEC on October 31, 2025.
In addition, the Alberta Securities Commission; the Autorité des marchés financiers; the British Columbia Securities Commission; the Manitoba Securities Commission; the Financial and Consumer Services Commission of New Brunswick; the Office of the Superintendent of Securities, Digital Government and Service Newfoundland and Labrador; the Office of the Superintendent of Securities, Northwest Territories; the Nova Scotia Securities Commission; the Office of the Superintendent of Securities, Nunavut; the Prince Edward Island Office of the Superintendent of Securities; the Financial and Consumer Affairs Authority of Saskatchewan; and the Office of the Yukon Superintendent of Securities have either not objected to or have approved the Amendments.