Point of Sale Disclosure for Mutual Funds (POS Project)
Effective January 1, 2011, mutual fund companies are required to prepare and file a Fund Facts for each class or series of each of their mutual funds and to post the Fund Facts to their website. They must also deliver the Fund Facts to investors free of charge upon request.
The Fund Facts is a document that is designed to give investors key information about a mutual fund, in language they can easily understand, at a time that is relevant to their investment decision.
Stage 2 of the POS Project is now underway:
- On August 12, 2011, we published for comment proposed amendments to National Instrument 81-101 Mutual Fund Prospectus Disclosure to allow delivery of the Fund Facts instead of the simplified prospectus to satisfy current prospectus delivery requirements. The comment period ended on November 10, 2011.
- On June 21, 2012, we published for second comment changes to the proposed amendments which focus primarily on the presentation of risk in the Fund Facts. The comment period is open until September 6, 2012.
The POS Project is a continuation of the shared vision of securities and insurance regulators to provide investors with more meaningful and effective prospectus disclosure of mutual funds and segregated funds, as described in Framework 81-406 Point of Sale Disclosure for Mutual Funds and Segregated Funds (the Framework) published by the Joint Forum of Financial Market Regulators on October 24, 2008.
The CSA published proposed rule amendments aimed at implementing all of the elements of the point of sale disclosure regime set out in the Framework on June 19, 2009 (the 2009 Proposal).
After considering all of the comments received on the 2009 Proposal, the CSA concluded to proceed with a staged implementation of the Framework, as set out in CSA Staff Notice 81-319 Status Report on the Implementation of Point of Sale Disclosure for Mutual Funds published on June 16, 2010.
Stage 1 of the POS Project was completed on October 6, 2010 when the CSA published amendments to National Instrument 81-101 Mutual Fund Prospectus Disclosure to require the preparation, filing and posting of the Fund Facts.