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CIBC Asset Management Inc. - MRRS Decision
Headnote
Mutual Reliance Review System for Exemptive Relief Applications -- Extension of lapse date for mutual fund prospectus for a specified period of time.
Applicable Ontario Statute
Securities Act, R.S.O., 1990, c. S.5, as amended, ss. 62(2) and 62(5).
IN THE MATTER OF
THE SECURITIES LEGISLATION OF
BRITISH COLUMBIA, ALBERTA, SASKATCHEWAN, MANITOBA,
ONTARIO, QUEBEC, NOVA SCOTIA, PRINCE EDWARD ISLAND, AND
NEWFOUNDLAND AND LABRADOR
AND
IN THE MATTER OF
THE MUTUAL RELIANCE REVIEW SYSTEM
FOR EXEMPTIVE RELIEF APPLICATIONS
AND
IN THE MATTER OF
CIBC ASSET MANAGEMENT INC.
AND
FRONTIERS CANADIAN SHORT TERM INCOME POOL
FRONTIERS CANADIAN FIXED INCOME POOL
FRONTIERS CANADIAN EQUITY POOL
FRONTIERS U.S. EQUITY POOL
FRONTIERS U.S. EQUITY RSP POOL
FRONTIERS INTERNATIONAL EQUITY POOL
FRONTIERS INTERNATIONAL EQUITY RSP POOL
FRONTIERS EMERGING MARKETS EQUITY POOL
FRONTIERS GLOBAL BOND POOL
(each a "Pool", collectively the "Pools")
MRRS DECISION DOCUMENT
WHEREAS the local securities regulatory authority or regulator (the "Decision Maker") in each of the provinces of Canada except New Brunswick (the "Jurisdictions") has received an application (the "Application") from CIBC Asset Management Inc. ("CM"), the manager of the Pools, on behalf of each Pool, for a decision (the "Decision") pursuant to the securities legislation of the Jurisdictions (the "Legislation") that the time periods prescribed by the Legislation for filing the final simplified prospectus and annual information form (together, the "Renewal Prospectus") of the Pools be extended to the time periods that would be applicable if the lapse date for the distribution of the units of the Pools was December 26, 2003;
AND WHEREAS pursuant to the Mutual Reliance Review System for Exemptive Relief Applications (the "System"), the Ontario Securities Commission is the principal regulator for this Application;
AND WHEREAS CM has represented to the Decision Makers that:
1. CM is a corporation incorporated under the laws of Canada and is the manager of the Pools.
2. Each of the Pools is an open-ended mutual fund trust established under the laws of Ontario by a Declaration of Trust.
3. Each of the Pools is a reporting issuer in each of the provinces and territories of Canada.
4. Units of the Pools are currently qualified for distribution in each of the Jurisdictions pursuant to a simplified prospectus and annual information form dated November 26, 2002 (the "Current Prospectus"). The MRRS decision document evidencing final receipts of the securities regulatory authorities in each of the Jurisdictions in respect of the Current Prospectus was issued on November 28, 2002. The earliest lapse date under the Legislation for distribution of units of the Pools under the Current Prospectus is November 26, 2003.
5. There have been no material changes in the affairs of the Pools since the date of the Current Prospectus in respect of which an amendment to the Current Prospectus has not been prepared and filed in accordance with the Canadian securities laws.
6. The Pools filed a pro forma prospectus and annual information form on October 22, 2003 under SEDAR project number 582248 in each of the Jurisdictions within the time limits specified by the Legislation.
7. CM is contemplating the possibility of offering a new fund which would be established in early January (the "New Fund").
8. The Pools have been offered under the Frontiers Program which includes an asset allocation service which relates to all of the Pools and a prospectus for all Pools is provided to investors. Accordingly, CM would like to qualify the New Fund for distribution in each of the Jurisdictions by including the New Fund in the final Renewal Prospectus of the Pools to avoid having two sets of disclosure documents.
9. If the New Fund is established in 2003, it will only have until March, 2004 (three months) to qualify as "mutual fund trust" for the purposes of the Income Tax Act (Canada) (the "ITA). It may prove to be difficult to obtain 150 unitholders in the New Fund in that three month period as the minimum investment in the Pools is $25,000 per account. If the New Fund is established in January, 2004, the New Fund will have until March, 2005 (15 months) to qualify as a "mutual fund trust" under the ITA, which is a significantly longer period.
10. Without an extension to the Pools' lapse date, CM will have to file in final form a Renewal Prospectus not later than December 6, 2003 and obtain a receipt for the renewal prospectus by December 16, 2003, which prevents CM from including the New Fund in the final Renewal Prospectus for the reason discussed in paragraph 9, and shortly thereafter CM will have to file a preliminary and amended and restated simplified prospectus and annual information form to incorporate the New Fund and the Pools in one document, paying the costs of preparing, printing and distributing the prospectuses twice.
AND WHEREAS pursuant to the System this MRRS Decision Document evidences the Decision of each Decision Maker;
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;
THE DECISION of the Decision Makers pursuant to the Legislation is that the lapse date for filing the Renewal Prospectus of the Pools be extended to the time period that would be applicable if the lapse date for the distribution of the units of the Pools was December 26, 2003.
December 5, 2003.
"Leslie Byberg"