Industry


Prospectus Offerings


If an investment fund wants to distribute securities to the public, it must begin by filing a preliminary prospectus.

The OSC reviews, provides comments and may ask for changes on the preliminary prospectus. The investment fund must then amend the prospectus to the satisfaction of the OSC. Once this is done, a final prospectus is submitted to the OSC.

If a receipt is issued for a final prospectus, the prospectus can then be used to offer securities. In addition, the investment fund becomes a reporting issuer in Ontario and is subject to certain ongoing disclosure requirements. For more information on these requirements, see Ongoing Disclosure

If an investment fund wants to sell securities in other provinces or territories in Canada, it must also comply with the laws of those jurisdictions. More details on the filing and review process for prospectuses filed in multiple jurisdictions can be found in National Policy 11-202 Process for Prospectus Reviews in Multiple Jurisdictions.

Types of Prospectuses

The type of prospectus that an investment fund must prepare depends on the type of investment fund that is offering securities and whether the investment fund is making an initial offering or a subsequent offering.  

A conventional mutual fund must prepare a simplified prospectus. All other investment funds (which we refer to as “non-conventional investment funds”) must prepare a long form prospectus.  

A non-conventional investment fund that has previously offered securities under a long form prospectus may be eligible to use a short form prospectus if it meets certain criteria.  

Simplified Prospectus for Conventional Mutual Funds

Generally, a conventional mutual fund is an investment fund that offers securities that are redeemable on demand by investors for a proportionate interest of the mutual fund’s net assets. These securities are offered continuously and are not listed on a stock exchange. Conventional mutual funds include most mutual funds offered by banks and mutual fund companies.  

In order to sell securities to the public, National Instrument 81-101 Mutual Fund Prospectus Disclosure (NI 81-101) requires a conventional mutual fund to prepare and file:  

  • a simplified prospectus,
  • an annual information form (AIF), and
  • a Fund Facts document for every class or series of a mutual fund.

Information on the disclosure required in a simplified prospectus, AIF, and Fund Facts document is set out in Form 81-101F1 Contents of Simplified Prospectus, Form 81-101F2 Contents of Annual Information Form, and Form 81-101F3 Content of Fund Facts Document.

A mutual fund manager that manages multiple mutual funds may consolidate the simplified prospectuses of its mutual funds into a multiple simplified prospectus. If the simplified prospectuses of a group of mutual funds are consolidated, the AIFs for those mutual funds must also be consolidated into a multiple AIF.  

NI 81-101 also sets out other requirements for mutual fund prospectuses, including requirements regarding the filing of prospectus amendments, the incorporation by reference of specified documents, audit and review requirements for financial statements incorporated by reference and document delivery to investors.  

The review period for a simplified prospectus is generally 10 working days. For more information on the review procedures for prospectuses, see National Policy 11-202 Process for Prospectus Reviews in Multiple Jurisdictions.  

A mutual fund can distribute its securities under its simplified prospectus for 12 months. After 12 months, the simplified prospectus lapses. A mutual fund that is distributing securities under a simplified prospectus may continue to distribute its securities after the lapse date if it meets certain conditions, including filing a pro forma simplified prospectus within a specified time limit. For additional information, see NI 81-101 and section 62 of the Securities Act (Ontario).  

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Long Form Prospectus for Non-Conventional Investment Funds

A non-conventional investment fund must prepare a long form prospectus for its initial public offering. Such investment funds include closed end funds, commodity pools, labour sponsored investment funds, mutual funds that trade on an exchange and scholarship plans.

A non-conventional investment fund must prepare a long form prospectus in accordance with National Instrument 41-101 General Prospectus Requirements (NI 41-101) to undertake an initial offering to the public.

NI 41-101 sets out the requirements for a long form prospectus, including requirements regarding the filing of prospectus amendments, the appointment of a custodian and the audit and review of financial statements included in (or incorporated by reference into) a prospectus. For additional information, see NI 41-101.

The review period for a long form prospectus is generally 10 working days. For more information on the review procedures for prospectuses, see National Policy 11-202 Process for Prospectus Reviews in Multiple Jurisdiction.

An investment fund that is distributing securities continuously under a long form prospectus may do so for 12 months. After 12 months, the long form prospectus lapses. The investment fund may continue to distribute its securities after the lapse date if it meets certain conditions, including filing a pro forma prospectus within a specified time limit. For additional information, see NI 41-101 and section 62 of the Securities Act (Ontario).

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Short Form Prospectus

If a non-conventional investment fund is already a reporting issuer in a Canadian jurisdiction, it may be eligible to use a short form prospectus. This type of prospectus allows existing reporting issuers to incorporate by reference certain information into the prospectus. For example, an eligible investment fund would be able to use its continuous disclosure as the basis for disclosure incorporated by reference into the short form prospectus.

National Instrument 44-101 Short Form Prospectus Distributions sets out the eligibility criteria and disclosure requirements for using a short form prospectus. Note that a conventional mutual fund cannot use a short form prospectus.

The review period for a short form prospectus is generally three working days. For more information on the review procedures for prospectuses, see National Policy 11-202 Process for Prospectus Reviews in Multiple Jurisdictions.

For more information: