IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO
August 5, 2025
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 Manulife Investment Management Limited (the Filer)
AND
Manulife Real Asset Pooled Fund (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), exempting the Fund from:
(a) the requirement in section 2.2 of National Instrument 81-106 Investment Fund Continuous Disclosure (NI 81-106) that the Fund file its audited annual financial statements and auditor’s report (the Annual Financial Statements) on or before the 90th day after the Fund’s most recently completed financial year (the Annual Filing Deadline);
(b) the requirement in paragraph 5.1(2)(a) of NI 81-106 that the Fund deliver to securityholders its Annual Financial Statements by the Annual Filing Deadline (the Annual Delivery Requirement);
(c) the requirement in section 2.4 of NI 81-106 that the Fund file its unaudited interim financial statements (the Interim Financial Statements) on or before the 60th day after the Fund’s most recently completed interim period (the Interim Filing Deadline); and
(d) the requirement in paragraph 5.1(2)(b) of NI 81-106 that the Fund deliver to securityholders its Interim Financial Statements by the Interim Filing Deadline (the Interim Delivery Requirement);
(collectively, the Exemption Sought).
Under National Policy 11-203 - Process for Exemptive Relief Applications in Multiple Jurisdictions:
(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 British Columbia, Alberta, Saskatchewan, Manitoba, Québec, New Brunswick, Newfoundland and Labrador, Nova Scotia, Prince Edward Island, Northwest Territories, Nunavut and Yukon (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 - Definitions, NI 81-102 or in MI 11-102 have the same meaning if used in this decision, unless otherwise defined herein.
Representations
The decision is based on the following facts represented by the Filer:
The Filer
The Filer is a corporation existing under the laws of Canada, with its registered head office located in Toronto, Ontario.
The Filer is registered as a portfolio manager in each province and territory of Canada. The Filer is also registered as an investment fund manager in Ontario, Québec and Newfoundland and Labrador, as a commodity trading manager in Ontario and a derivatives portfolio manager in Québec.
The Filer is the general partner, investment fund manager and portfolio advisor of the Fund.
The Filer is not in default of securities legislation in any Jurisdiction.
The Fund
The Fund is a limited partnership formed under the laws of the Province of Ontario.
The Fund is an “investment fund” for purposes of the Legislation.
Units of the Fund will be offered for sale on a continuous basis to qualified investors in all provinces and territories of Canada pursuant to exemptions from the prospectus requirements under National Instrument 45-106 - Prospectus Exemptions (NI 45-106) or equivalent exemptions. Currently, it is anticipated that investors will be limited to segregated funds affiliated with the Filer.
Each investor in the Fund is, or will be, responsible for making its own investment decisions regarding its purchases and/or redemptions of securities of the Fund.
The Fund is not a reporting issuer in any province or territory of Canada.
The Fund is not in default of securities legislation in any Jurisdiction.
The Fund has a financial year-end of December 31.
The Fund’s investment objective is to seek total return, consisting of income and long-term capital growth, by primarily investing in, or gaining exposure to, a diversified portfolio of investment funds and other issuers that invest directly and indirectly in private real assets and other private market assets globally as well as publicly traded securities.
The Fund will seek to achieve its investment objective by investing primarily in public and private real asset funds (collectively, the Underlying Funds). The Fund’s exposure to private real assets is expected to be made primarily through investment in Manulife Real Asset Fund (MRAF). MRAF invests in affiliated and unaffiliated underlying funds providing direct exposure to real estate, timberland and farmland, infrastructure, private debt and other private market asset classes.
Generally, it is anticipated that the Fund will seek to have approximately 80% exposure to private real assets (predominantly expected to be through an investment in MRAF) and approximately 20% exposure to publicly traded securities and other marketable assets.
The Filer believes that investing in MRAF offers benefits not available through a direct investment in the companies, other issuers or assets held by MRAF.
The Fund is able to manage its own liquidity requirements taking into consideration the frequency at which the securities of MRAF and other Underlying Funds may be redeemed. In addition, as noted, the Fund will generally seek to maintain approximately 20% of its portfolio in more liquid securities.
The net asset value of the Fund will be calculated on each day, except if that day falls on a Saturday, Sunday, a statutory holiday in Toronto, Ontario or another day on which the Toronto Stock Exchange is not open for trading. The net asset value of the Fund will be disseminated on a daily basis.
The holdings by the Fund of securities of MRAF will be disclosed in the financial statements of the Fund.
The limited partnership agreement of the Fund will permit the Annual Financial Statements and Interim Financial Statements of the Fund to be filed and delivered in accordance with the Exemption Sought.
Underlying Fund Investment – MRAF
MRAF is a limited partnership formed under the laws of the Province of Ontario and is also managed by the Filer.
MRAF’s investment objective is to achieve long term growth of capital. MRAF seeks positive returns over the Canadian Consumer Price Index (CPI) by investing in direct real assets and liquid assets globally. MRAF’s exposure to real assets (such as real estate, infrastructure and private debt) is obtained by investing in securities of underlying direct real asset funds (the MRAF Underlying Funds).
Units of MRAF are redeemable on a daily basis. However, redemptions of units with a net asset value of under $100 million require that written notice must be delivered at least 12 months prior to the redemption day. Redemptions of units with a net asset value of $100 million or more require that written notice must be delivered at least 24 months prior to the redemption day.
All of the MRAF Underlying Funds currently invested in by MRAF have financial reporting periods that end on December 31 of each year.
The Filer believes that investments by MRAF in the MRAF Underlying Funds offer benefits not available through a direct investment in the companies, other issuers or assets held by the MRAF Underlying Funds.
The Filer engages in an extensive due diligence process when selecting MRAF Underlying Funds for MRAF.
Securities of the MRAF Underlying Funds are typically redeemable at various intervals. As MRAF has a long-term investment horizon, MRAF is able to manage its own liquidity requirements taking into consideration the frequency at which the securities of the MRAF Underlying Funds may be redeemed.
The net asset value of MRAF is calculated on each day, except if that day falls on a Saturday, Sunday, a statutory holiday in Toronto, Ontario or another day on which the Toronto Stock Exchange is not open for trading. The net asset value of MRAF is made available to investors on a daily basis and investors are provided with quarterly statements.
The holdings by MRAF of securities of the MRAF Underlying Funds are disclosed in the financial statements of MRAF.
Nine of the MRAF Underlying Funds currently invested in by MRAF are managed by entities unrelated to the Filer. The delivery requirements for the annual financial statements and the interim financial statements for all nine of these third-party managed MRAF Underlying Funds (the MRAF Misaligned Third-Party Underlying Funds) do not comply with the Annual Delivery Requirement and the Interim Delivery Requirement, as applicable.
Approximately 41% of MRAF’s assets are currently invested in MRAF Misaligned Third-Party Underlying Funds.
MRAF is not able to obtain the financial statements of the MRAF Misaligned Third-Party Underlying Funds sooner than the deadline for filing the financial statements of the MRAF Misaligned Third-Party Underlying Funds and, in all cases, no sooner than other unitholders of the MRAF Misaligned Third-Party Underlying Funds receive the financial statements of the MRAF Misaligned Third-Party Underlying Funds.
As a result, and subject to the terms and conditions contained therein, MRAF obtained exemptive relief which allows MRAF to extend its: (i) Annual Filing Deadline and Annual Delivery Requirement by 90 days; and (ii) Interim Filing Deadline and Interim Delivery Requirement by 60 days (the MRAF Financial Statement Relief).
Financial Statement Filing and Delivery Requirements
Section 2.2 and paragraph 5.1(2)(a) of NI 81-106 require the Fund to file and deliver its Annual Financial Statements by the Annual Filing Deadline. As the Fund’s financial year-end is December 31, the Annual Filing Deadline for the Annual Financial Statements would be March 31.
Section 2.4 and paragraph 5.1(2)(b) of NI 81-106 require the Fund to file and deliver its Interim Financial Statements by the Interim Filing Deadline. As the Fund’s interim period-end is June 30, the Interim Filing Deadline for the Interim Financial Statements would be August 29.
Section 2.11 of NI 81-106 provides an exemption from the filing requirements of the Annual Financial Statements and the Interim Financial Statements if, among other things, the Fund delivers its Annual Financial Statements and Interim Financial Statements in accordance with Part 5 of NI 81-106 by the Annual Filing Deadline and Interim Filing Deadline, as applicable.
In order to formulate an opinion on the financial statements of the Fund, the Fund’s auditor requires audited financial statements of MRAF as at the date of the financial year-end of the Fund in order to audit the information contained in the Fund’s financial statements.
The auditor of the Fund has advised the Filer that they may be unable to complete the audit of the Fund’s Annual Financial Statements until the audited financial statements of MRAF are completed and available to the Fund.
As a result of the MRAF Financial Statement Relief, the delivery requirements for the annual financial statements and the interim financial statements for MRAF do not comply with the Annual Delivery Requirement and the Interim Delivery Requirement, as applicable.
Owing to MRAF’s investment in the MRAF Misaligned Third-Party Underlying Funds, and MRAF’s reliance on the MRAF Financial Statement Relief, the Fund will not be able to obtain the financial statements of MRAF sooner than the deadline for filing the financial statements of MRAF and, in all cases, no sooner than other unitholders of MRAF receive the financial statements of MRAF.
The limited partnership agreement and, if applicable, the offering memorandum that will be provided to investors in the Fund will disclose that:
(a) Annual Financial Statements for the Fund would be delivered to each investor within 180 days of the Fund’s financial year end; and
(b) Interim Financial Statements for the Fund would be delivered to each investor within 120 days following the end of each interim period of the Fund.
The Filer will notify its securityholders that it has received and intends to rely on relief from the Annual Filing Deadline, Annual Delivery Requirement, Interim Filing Deadline, and Interim Delivery Requirement.
MRAF is a suitable and desirable investment for the Fund. As noted, MRAF (owing to the MRAF Financial Statement Relief) has financial reporting deadlines that are not aligned with the filing and delivery deadlines contemplated by NI 81-106 and that are applicable to the Fund. Given the expected investment profile of the Fund, the Filer expects such timing discrepancies to occur year after year for the foreseeable future.
The Fund therefore seeks an extension of the Annual Filing Deadline and Annual Delivery Requirement to permit delivery within 180 days of the Fund’s year end, to enable the Fund’s auditors to first receive the audited financial statements of MRAF, so as to be able to prepare its opinion with respect to the Fund’s annual audited financial statements.
Owing to its investments in MRAF, apart from the timing challenges imposed by producing financial statements/financial reports in accordance with the Annual Filing Deadline and the Interim Filing Deadline, the delivery of any financial statements/reports prepared within the applicable time frames could be detrimental to investors, as such statements would necessarily be based on estimates which are subject to change and therefore could be materially inaccurate. Such rationale is equally applicable to the annual financial statements, as it is to the interim financial reports. In the Filer’s view, investors are better served by having financial statements/financial reports free of material inaccuracies delivered: (i) in the case of annual financial statements, within 180 days following the Fund’s year-end rather than the Annual Filing Deadline; and (ii) in the case of interim financial reports, within 120 days following the Fund’s most recent interim period rather than the Interim Filing Deadline.
In order to ensure all financial statements of the Fund are free of material inaccuracies, the Filer therefore also seeks an extension of the Interim Filing Deadline and Interim Delivery Requirement to permit delivery within 120 days of the Fund’s most recent interim period.
The Fund’s independent, third-party auditor has advised the Filer that a potential audit issue may arise if audited financial statements from MRAF are unavailable at the time of the Fund’s preparation of its annual financial statements, as, in their absence, it is challenging and costly for the Fund to establish sufficient and appropriate evidence of the fair value of these privately held investments.
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 to the Fund provided that:
(a) The Fund has a financial year ended December 31.
(b) The Fund’s investment strategy is to primarily invest the Fund’s investable assets directly or indirectly in securities of one or more Underlying Funds whose investment objectives are compatible with the Fund’s investment objectives.
(c) No less than 25% of the total assets of the Fund as at its financial year-end of December 31 are invested in MRAF, which has a financial year-end that corresponds to the Fund and has obtained exemptive relief that permits:
(i) annual financial statements to be made available within 180 days of its financial year end; and
(ii) interim financial statements to be made available within 120 days of its most recent interim periods.
(d) The limited partnership agreement and, if applicable, the offering memorandum provided to prospective investors regarding the Fund discloses that, subject to regulatory approval:
(i) the Annual Financial Statements of the Fund will delivered on or before the 180th day after the Fund’s most recently completed financial year; and
(ii) the Interim Financial Statements of the Fund will be delivered on or before the 120th day after the Fund’s most recently completed interim period.
(e) The Fund notifies its securityholders that the Fund has received and intends to rely on relief from the filing and delivery requirements under section 2.2, section 2.4, paragraph 5.1(2)(a) and paragraph 5.1(2)(b) of NI 81-106.
(f) The Fund is not a reporting issuer in any Jurisdiction, and the Filer has the necessary registrations to carry out its operations in each Jurisdiction in which it operates.
(g) The conditions in section 2.11 of NI 81-106 will be met, except for subsection 2.11(b), and:
(i) the Annual Financial Statements will be delivered to securityholders of the Fund in accordance with Part 5 of NI 81-106 on or before the 180th day after the Fund’s most recently completed financial year; and
(ii) the Interim Financial Statements will be delivered to securityholders of the Fund in accordance with Part 5 of NI 81-106 on or before the 120th day after the Fund’s most recently completed interim period.
(h) This decision terminates within one year of the coming into force of any amendment to NI 81-106 or other rule that modifies how the Annual Filing Deadline, the Interim Filing Deadline, the Annual Delivery Requirement or the Interim Delivery Requirement applies in connection with investment funds that are not reporting issuers.
“Darren McKall”
Darren McKall Associate Vice President, Investment Management Division Ontario Securities Commission
Application #2025/0422 SEDAR+ File #6308594