September 17, 2021
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 AGF INVESTMENTS INC. (the Filer) and AGFiQ US Market Neutral Anti-Beta CAD-Hedged ETF (the Fund)
DECISION
Background
The principal regulator in the Jurisdiction has received an application from the Filer on behalf of the Fund for a decision under the securities legislation of the Jurisdiction (the Legislation) that the time limits for the renewal of the Fund’s Current Prospectus (defined below and dated October 21, 2020) be extended to the time limits that would apply if the lapse date was January 29, 2022 (the Requested Relief).
Under National Policy 11-203 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 each of the other provinces and territories of Canada (together with Ontario, 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.
Representations
This decision is based on the following facts represented by the Filer:
The Filer is a corporation existing under the laws of the Province of Ontario.
The Filer’s head office is located in Toronto, Ontario.
The Filer is registered as (a) an exempt market dealer in Alberta, British Columbia, Manitoba, Ontario, Quebec and Saskatchewan, (b) a portfolio manager in each of the Jurisdictions, (c) an investment fund manager in Alberta, British Columbia, Newfoundland and Labrador, Ontario and Quebec, (d) a mutual fund dealer in British Columbia, Ontario and Quebec, and (e) a commodity trading manager in Ontario.
The Filer is the trustee and investment fund manager of the Fund.
The Fund is an exchange-traded alternative mutual fund established as a trust under the laws of Ontario and a reporting issuer in the Jurisdictions.
Neither the Filer nor the Fund is in default of securities legislation in any of the Jurisdictions.
The Fund currently distributes its securities in the Jurisdictions pursuant to a stand-alone long-form prospectus prepared and filed in accordance with National Instrument 41-101 General Prospectus Requirements (NI 41-101) dated October 21, 2020 (the Current Prospectus).
The Fund is in continuous distribution and the securities of the Fund are listed on the Toronto Stock Exchange.
The lapse date of the Current Prospectus is October 21, 2021 (the Current Lapse Date).
Accordingly, under the Legislation, if a prospectus for the Fund is not otherwise filed and receipted by the Current Lapse Date, the distribution of securities of the Fund would have to cease on the Current Lapse Date unless: (i) the Fund files a pro forma long-form prospectus at least 30 days prior to the Current Lapse Date; (ii) the final prospectus of the Fund is filed no later than 10 days after the Current Lapse Date; and (iii) a receipt for the final prospectus of the Fund is obtained within 20 days after the Current Lapse Date.
In addition to the Fund, the Filer is also the investment fund manager of 11 exchange-traded mutual funds that are offered under a separate multi-fund long-form prospectus prepared and filed in accordance with NI 41-101 with a lapse date of January 29, 2022 (collectively, the Other Funds).
The Filer wishes to combine the Current Prospectus of the Fund with the prospectus of the Other Funds in order to permit administrative efficiencies and reduce renewal, translation, printing and related costs. Offering the Fund and the Other Funds under one multi-fund prospectus would facilitate the distribution of securities of the Fund and of the Other Funds in the Jurisdictions under the same prospectus, enable the Filer to make operational and administrative features of the Fund and Other Funds consistent with each other, if necessary, and permit the Filer to streamline disclosure across the Filer’s fund platform. As the Fund and the Other Funds are managed by the Filer, offering them under the same prospectus would allow investors to more easily compare the features of the Fund and the Other Funds.
If the Requested Relief is not granted, it will be necessary to renew prospectus documents for the Fund twice within a short period of time in order to consolidate the Current Prospectus with the Other Funds’ prospectus and establish a uniform filing timeline, and it would be unreasonable for the Filer to incur the costs and expenses associated therewith given how close in proximity the lapse date of the Current Prospectus and the lapse date of the prospectus of the Other Funds are to one another and given that investors would not be prejudiced by the Requested Relief.
There have been no material changes in the affairs of the Fund since the date of the Current Prospectus. Accordingly, the Current Prospectus and current ETF Facts of the Fund represent the current information of the Fund.
Given the disclosure obligations of the Filer and the Fund, should any material change in the business, operations or affairs of the Fund occur, the Current Prospectus and the current ETF Facts of the Fund will be amended as required under the Legislation.
New investors in the Fund will receive delivery of the most recently filed ETF Facts of the Fund. The Current Prospectus will still be available upon request.
The Requested Relief will not affect the accuracy of the information contained in the Current Prospectus or the ETF Facts of the Fund and therefore will not be prejudicial to the public interest.
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 Requested Relief is granted.
“Darren McKall”
Darren McKall, Manager, Investment Funds and Structured Products Branch Ontario Securities Commission
Application #2021/0488