Exemption from the requirement to deliver comparative annual financial statements for the year-ending September 30, 2003, to registered securityholders of certain mutual funds.
Securities Act (Ontario), R.S.O. 1990 c. S.5, as am., ss. 79 and 80(b)(iii).
IN THE MATTER OF
THE SECURITIES LEGISLATION OF
ALBERTA, ONTARIO, NOVA SCOTIA,
IN THE MATTER OF
THE MUTUAL RELIANCE REVIEW SYSTEM
FOR EXEMPTIVE RELIEF APPLICATIONS
IN THE MATTER OF
THE FUNDS LISTED IN SCHEDULE "A"
MRRS DECISION DOCUMENT
WHEREAS the local securities regulatory authority or regulator (the "Decision Maker") in each of Alberta, Ontario, Nova Scotia, Newfoundland and Labrador (the "Jurisdictions") has received an application (the "Application") from the Funds and AGF Funds Inc. ("AGF"), the manager of the Funds and funds to be established by AGF in the future (the "Future Funds"), for a decision pursuant to the securities legislation of the Jurisdictions (the "Legislation") that the requirement to deliver comparative annual financial statements of the Funds to certain securityholders of the Funds shall not apply unless they have requested to receive them.
AND WHEREAS under the Mutual Reliance Review System for Exemptive Relief Applications (the "System"), the Ontario Securities Commission is the principal regulator for this application;
AND WHEREAS, unless otherwise defined, the terms herein have the meaning set out in National Instrument 14-101 Definitions;
AND WHEREAS AGF has represented to the Decision Makers that:
(a) The Funds are either open-ended mutual fund trusts, separate classes of mutual fund corporations, or mutual fund corporations governed by the laws of Ontario.
(b) AGF acts as manager of the Funds set out in Schedule "A" and, in the case of its Funds which are trusts, it is the trustee of such Funds.
(c) The Funds are reporting issuers in each of the Jurisdictions and are not in default of any requirements of the Legislation.
(d) Securities of the Funds, except AGF Managed Futures Fund, are presently offered for sale on a continuous basis in provinces and territories of Canada pursuant to a simplified prospectus. Securities of AGF Managed Futures Fund are presently offered for sale on a continuous basis in provinces and territories of Canada pursuant to a long form prospectus.
(e) Each of the Funds is required to deliver annually, within 140 days of its financial year-end, to each holder of its securities ("Securityholders"), comparative financial statements in the prescribed form pursuant to the Legislation.
(f) AGF will send to Securityholders who hold securities of the Funds in client name (whether or not AGF is the dealer) (the "Direct Securityholders") in each year, a notice advising them that they will not receive the annual financial statements of the Funds for the year then ended unless they request same, and providing them with a request form to send back, by fax or prepaid mail, if they wish to receive the annual financial statements. The notice will advise the Direct Securityholders where annual financial statements can be found on the Internet (including on the SEDAR website) and downloaded. AGF would send such financial statements to any Direct Securityholder who requests them in response to such notice or who subsequently requests them.
(g) Securityholders who hold their securities in the Funds through a nominee will be dealt with pursuant to National Instrument 54-101.
(h) Securityholders will be able to access annual financial statements of the Funds either on the SEDAR website or on the website of AGF or by calling AGF's toll-free phone line. Top ten holdings which are updated on a monthly basis will also be accessible to Securityholders on AGF's website or by calling AGF's toll-free phone line.
(i) There would be substantial cost savings if the Funds are not required to print and mail annual financial statements to those Direct Securityholders who do not want them.
(j) The Canadian Securities Administrators ("CSA") have published for comment proposed National Instrument 81-106 ("NI 81-106") which, among other things, would permit a Fund not to deliver annual financial statements to those of its Securityholders who do not request them, if the Funds provide each Securityholder with a request form under which the Securityholder may request, at no cost to the Securityholder, to receive the mutual fund's annual financial statements for that financial year.
(k) NI 81-106 would also require a Fund to have a toll-free telephone number for, or accept collect calls from, persons or companies that want to receive a copy of, among other things, the annual financial statements of the Fund.
AND WHEREAS under the System this MRRS Decision Document evidences the decision of each Decision Maker (collectively, the "Decision");
AND WHEREAS each of the Decision Makers is satisfied that the test contained in the Legislation that provides the Decision Maker with the jurisdiction to make the Decision has been met;
AND WHEREAS the Decision Makers are satisfied that making the Decision will not adversely affect the rule-making process with respect to proposed National Instrument 81-106 and is consistent with National Instrument 54-101;
THE DECISION of the Decision Makers pursuant to the Legislation is that:
(i) the Funds; and
(ii) the Future Funds
shall not be required to deliver their comparative annual financial statements for the year ended September 30, 2003 to their Direct Securityholders other than those Direct Securityholders who have requested to receive them provided that:
(a) AGF shall file on SEDAR, under the annual financial statements category, confirmation of mailing of the request forms that have been sent to the Direct Securityholders as described in clause (f) of the representations within 90 days of mailing the request forms;
(b) AGF shall file on SEDAR, under the annual financial statements category, information regarding the number and percentage of requests for annual financial statements made by the return of the request forms, on a province-by-province basis within 30 days after the end of each quarterly period beginning from the date of mailing the request forms and ending 12 months from the date of mailing;
(c) AGF shall record the number and summary of complaints received from Direct Securityholders about not receiving the annual financial statements and shall file on SEDAR, under the annual financial statements category, this information within 30 days after the end of each quarterly period beginning from the date of mailing the request forms and ending 12 months from the date of mailing;
(d) AGF shall, if possible, measure the number of "hits" on the annual financial statements of the Funds on AGF's website and shall file on SEDAR, under the annual financial statements category, this information within 30 days after the end of each quarterly period beginning from the date of mailing the request forms and ending 12 months from the date of mailing; and
(e) AGF shall file on SEDAR, under the annual financial statements category, estimates of the cost savings resulting from the granting of this Decision within 90 days of mailing the request forms.
April 17, 2003.
"Paul M. Moore"
"Robert L. Shirriff"
AGF Canadian AggressiveTM All-Cap Fund
AGF Canadian Dividend Fund
AGF Canadian Growth Equity Fund Limited
AGF Canadian Small Cap Fund
AGF Canadian Stock Fund
AGF Canadian Value Fund
AGF AggressiveTM Global Stock Fund
AGF AggressiveTM Growth Fund
AGF AggressiveTM Japan Class
AGF American Growth Class
AGF Asian Growth Class
AGF Canada Class
AGF China Focus Class
AGF Emerging Markets Value Fund
AGF European Equity Class
AGF Germany Class
AGF Global Equity Class
AGF India Fund
AGF International Stock Class
AGF International Value Class
AGF International Value Fund
AGF Japan Class
AGF Latin America Fund
AGF MultiManagerTM Class
AGF RSP American Growth Fund
AGF RSP European Equity Fund
AGF RSP International Equity Allocation Fund
AGF RSP International Value Fund
AGF RSP Japan Fund
AGF RSP MultiManagerTM Fund
AGF RSP World Companies Fund
AGF RSP World Equity Fund
AGF Special U.S. Class
AGF U.S. Value Class
AGF World Companies Fund
AGF World Equity Fund
AGF World Opportunities Fund
AGF Canadian Resources Fund Limited
AGF Global Financial Services Class
AGF Global Health Sciences Class
AGF Global Real Estate Equity Class
AGF Global Resources Class
AGF Global Technology Class
AGF Precious Metals Fund
Balanced and Asset Allocation Funds
AGF Canadian Balanced Fund
AGF Canadian Tactical Asset Allocation Fund
AGF American Tactical Asset Allocation Fund
AGF RSP American Tactical Asset Allocation Fund
AGF RSP World Balanced Fund
AGF World Balanced Fund
Fixed Income Funds
AGF Canadian Bond Fund
AGF Canadian Conservative Income Fund
(formerly, AGF Canadian High Income Fund)
AGF Canadian Money Market Fund
AGF Canadian Total Return Bond Fund
AGF Global Government Bond Fund
AGF Global Total Return Bond Fund
AGF RSP Global Bond Fund
AGF Short-Term Income Class
AGF U.S. Dollar Money Market Account
AGF Managed Futures Fund
Harmony Investment Pools
Harmony Americas Small Cap Equity Pool
Harmony Canadian Equity Pool
Harmony Canadian Fixed Income Pool
Harmony Money Market Pool
Harmony Overseas Equity Pool
Harmony RSP Americas Small Cap Equity Pool
Harmony RSP Overseas Equity Pool
Harmony RSP U.S. Equity Pool
Harmony U.S. Equity Pool
Class of AGF All World Tax Advantage Group Limited.