Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Mutual funds granted relief from delivering annual financial statements, and preparing, filing, and delivering annual management reports of fund performance – Funds were operating for a short period - Manager is the sole unitholder.
Applicable Legislative Provisions
National Instrument 81-106 Investment Fund Continuous Disclosure, section 4.2 and 5.1(2).
June 29, 2011
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF Fidelity Global Large Cap Fund, Fidelity Global Small Cap Fund and Fidelity Tactical Strategies Fund (collectively, the Funds)
AND
FIDELITY INVESTMENTS CANADA ULC (the Filer)
DECISION
Background
The principal regulator in the Jurisdiction has received an application from the Filer, on behalf of each of the Funds, for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) exempting the Funds from the following requirements of the Legislation:
(a) the requirement in section 4.2 of National Instrument 81-106 Investment Fund Continuous Disclosure (NI 81-106) to file annual management reports of fund performance (MRFPs) for the fiscal year ended March 31, 2011 (the Reporting Period); and
(b) the requirement in paragraph 5.1(2) of NI 81-106 to send to each securityholder the annual financial statements and annual MRFPs for the Reporting Period
(collectively, the Exemption Sought).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions:
(a) the Ontario Securities Commission 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, Quebec, New Brunswick, Nova Scotia, Prince Edward Island and Newfoundland and Labrador, Northwest Territories, Yukon and Nunavut (together with the Jurisdiction, referred to as the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined. The following additional terms shall have the following meanings:
Form 81-106F1 means the form in NI 81-106 that prescribes the content disclosure required in an annual or interim management report of fund performance; and
NI 81-102 means National Instrument 81-102 Respecting Mutual Funds.
Representations
This decision is based on the following facts represented by the Manager:
The Manager is a corporation continued under the laws of Alberta, with its head office in Toronto, Ontario.
The Manager is the manager and the trustee of each of the Funds.
The Funds are open-ended mutual fund trusts established on March 25, 2011 under the laws of Ontario pursuant to a Declaration of Trust.
Each Fund became a reporting issuer under applicable securities legislation of the Jurisdictions on March 30, 2011, following the issuance of a receipt by the principal regulator for the final simplified prospectus and annual information form of the Funds dated March 25, 2011.
None of the Funds or the Manager are in default of securities legislation in any of the Jurisdictions of Canada.
As at March 25, 2011, the only units of each Fund issued were issued to the Filer for $150,000 to satisfy the requirement in paragraph 3.1(1)(a) of NI 81-102, as reflected in the audited statements of net assets of the Funds, which have been filed at the time of the filing of the final simplified prospectus and annual information form of the Funds.
The initial fiscal year end of each Fund is March 31, 2011.
As at March 31, 2011, no units of the Funds were issued to the public, the Manager was the sole unitholder in each of the Funds.
As at March 31, 2011 each Fund held only cash in its portfolio.
In the absence of the Exemption Sought, each of the Funds would be required to deliver audited financial statements, and file and deliver an annual MRFP for the financial year ended March 31, 2011.
Given that there was no investment activity in the Funds for the period from March 25, 2011 to March 31, 2011 and given that the units of the Funds were not offered to the public as of March 31, 2011, no significant information or financial highlights can be provided for the purposes of the preparation of the MRFPs as prescribed under NI 81-106.
Decision
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 the Manager will prepare and file for each Fund an interim MRFP for the period ending September 30, 2011 in accordance with Form 81-106F1, except that the interim MRFP will include financial highlights as required by Part B, Item 3 of Form 81-106F1.
“Darren McKall” Darren McKall Manager, Investment Funds Branch Ontario Securities Commission