Securities Law & Instruments

Headnote

Mutual Reliance Review System for Exemptive Relief Applications - Extension of lapse date for mutual fund prospectus in response to elimination of foreign content restrictions in February 23, 2005 federal budget.

Statutes Cited

Securities Act, R.S.O. 1990 c. S.5, as amended, ss. 62(1), 62(2) and 62(5).

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

BRITISH COLUMBIA, ALBERTA, SASKATCHEWAN,

MANITOBA, ONTARIO, QUEBEC, NEW BRUNSWICK, 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

NATIONAL BANK SECURITIES INC.

AND

THE MUTUAL FUNDS SET OUT IN SCHEDULE "A" (THE "FUNDS")

 

MRRS DECISION DOCUMENT

WHEREAS the Canadian securities regulatory authority or regulator (the "Decision Maker") in each of the provinces of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, Nova Scotia, Prince Edward Island and Newfoundland and Labrador (the "Jurisdictions") has received an application (the "Application") from National Bank Securities Inc. (the "Manager") and the Funds for a decision pursuant to the securities legislation of the Jurisdictions (the "Legislation") that the time limits for the renewal of the simplified prospectus of the Funds dated April 1, 2004 (the "Prospectus") be extended to those time limits that would be applicable if the lapse date of the Prospectus were April 15, 2005 (the "Requested Relief").

AND WHEREAS pursuant to the Mutual Reliance Review System for Exemptive Relief Applications (the "System"), the Authorité des marchés financiers is the principal regulator for this application;

AND WHEREAS it has been represented by the Manager to the Decision Makers that:

(a) The Manager is the manager of the Funds.

(b) The Funds are either open-ended mutual fund trusts established under the laws of Quebec or classes of a mutual fund corporation, as indicated in Appendix "A".

(c) The Funds are currently qualified for distribution in all of the provinces and territories of Canada under a simplified prospectus and annual information form of the Funds dated April 1, 2004 (the "Prospectus").

(d) The Funds are reporting issuers under the Legislation. None of the Funds is in default of any of the requirements of the Legislation.

(e) In each province of Canada other than Quebec, the lapse date for the Funds is April 1, 2005, which allows the Funds until April 11, 2005 to file their final materials such that a receipt for the Prospectus is issued by securities regulatory authorities by April 21, 2005. In Quebec, the lapse date for the Funds is April 2, 2005 and the Funds must file their final materials no later than April 12, 2005 and obtain a receipt no later than April 22, 2005.

(f) On January 24, 2005, a pro forma prospectus and annual information form was filed for the Funds in all of the provinces and territories of Canada under SEDAR Project No. 732058.

(g) On February 15, 2005, a revised draft of the pro forma prospectus and annual information form for the Funds was filed in each province and territory of Canada and the Funds were prepared to file their final prospectus and annual information form, once securities regulators in each jurisdiction had cleared the Funds to do so.

(h) On February 23, 2005, the Budget Plan 2005 was released by the Department of Finance, Canada (the "Federal Budget"). At the present date, the Federal Budget is not fully approved and did not receive Royal Assent.

(i) The Federal Budget contemplates the repeal of the rule that limits the amount of foreign property that may be held in a registered plan, effective as of 2005. The repeal of the foreign property limit will affect a number of the Funds, particularly the RSP funds.

(j) If the requested relief is not granted, a prospectus must be filed in accordance with the existing time limits for the renewal of the Prospectus, and must be receipted by April 21, 2005.

(k) The Manager requires additional time to assess the impact of the Federal Budget on the Funds and to determine any changes that must be made to the Prospectus in response to the Federal Budget.

(l) A prospectus that does not address the initial measures may need to be substantially revised shortly thereafter. This process results in undue financial costs to the Funds (and thereby to investors in the Funds) as the result of preparing, filing and printing a revised prospectus.

(m) Since April 1, 2004, the date of the Prospectus, no undisclosed material change has occurred. Accordingly, the Prospectus provides accurate information regarding the Funds. The extension requested will not affect the currency or accuracy of the information contained in the Prospectus, and, accordingly, will not be prejudicial to the public interest.

AND WHEREAS pursuant to the System this MRRS Decision Document evidences decision of each Decision Maker (collectively, the "Decision");

AND WHEREAS defined terms contained in National Instrument 14-101 Definitions have the same meaning in this decision unless they are defined in this 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.

This decision is based on the following facts represented by the Filer :

The decision of the Decision Makers under the Legislation is that the Requested Relief is granted provided a final simplified prospectus is filed no later than 10 days after April 15, 2005 and that a receipt for the simplified prospectus is obtained no later than 20 days after April 15, 2005.

April 8, 2005.

"Josée Deslauriers"
Director of Capital Markets

 

SCHEDULE "A"

Money Market Funds
National Bank Money Market Fund
National Bank Treasury Bill Plus Fund
National Bank U.S. Money Market Fund
 
Institutional Funds
National Bank Corporate Cash Management Fund
National Bank Treasury Management Fund
 
Income Funds
National Bank Mortgage Fund
National Bank Bond Fund
National Bank Dividend Fund
National Bank Global RSP Bond Fund
National Bank High Yield Bond Fund
National Bank Monthly Income Fund
 
Diversified Funds
National Bank Retirement Balanced Fund
National Bank Secure Diversified Fund
National Bank Conservative Diversified Fund
National Bank Moderate Diversified Fund
National Bank Balanced Diversified Fund
National Bank Growth Diversified Fund
 
Canadian Growth Funds
National Bank Canadian Equity Fund
National Bank Canadian Opportunities Fund
National Bank Canadian Index Fund
National Bank Canadian Index Plus Fund
National Bank Small Capitalization Fund
 
International Growth Funds
National Bank Global Equity Fund
National Bank Global Equity RSP Fund
National Bank International RSP Index Fund
National Bank American RSP Index Fund
National Bank American Index Plus Fund
National Bank European Equity Fund
National Bank European Small Capitalization Fund
National Bank Asia-Pacific Fund
National Bank Emerging Markets Fund
 
Specialized Funds
National Bank Quebec Growth Fund
National Bank Natural Resources Fund
National Bank Future Economy Fund
National Bank Future Economy RSP Fund
National Bank Global Technologies Fund
National Bank Global Technologies RSP Fund
National Bank Strategic Yield Class of National Bank Funds Corporation
 
National Bank/Fidelity Funds
National Bank/Fidelity Canadian Asset Allocation Fund
National Bank/Fidelity True North Fund
National Bank/Fidelity International Portfolio Fund