Securities Law & Instruments

Headnote

Mutual Reliance Review System for Exemptive Relief Applications -- application for mutual fund prospectus lapse date extension -- lapse date coincides with filing deadline for initial management report of fund performance.

Applicable Ontario Provisions:

Securities Act, R.S.O. 1990, c. S.5 as am., s. 62(5).

August 30, 2005

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

(THE JURISDICTIONS)

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEW SYSTEM

FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF

MACKENZIE FINANCIAL CORPORATION

(THE MANAGER)

AND

THE MUTUAL FUNDS SET OUT IN SCHEDULE "A"

(THE FUNDS)

 

MRRS DECISION DOCUMENT

Background

The local securities regulatory authority or regulator (the Decision Maker) in each of the Jurisdictions has received an application from the Manager and the Funds for a decision under the securities legislation of the Jurisdictions (the Legislation) that the time limits for the renewal of the simplified prospectuses of the Funds dated September 30, 2004 (the Prospectus) be extended to those time limits that would be applicable if the lapse date of the Prospectus was October 31, 2005 (the Requested Relief).

Under the Mutual Reliance Review System for Exemptive Relief Applications

(a) the Ontario Securities Commission is the principal regulator for this application, and

(b) this MRRS decision document evidences the decision of each Decision Maker.

Interpretation

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

Representations

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

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

(b) The Funds consist of 38 classes of special shares of Mackenzie Financial Capital Corporation, a corporation incorporated under the laws of Ontario.

(c) The Funds are currently qualified for distribution in all of the provinces and territories of Canada under 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) A substantial amount of work must be done by the Manager in connection with the preparation of the Management Reports of Fund Performance (MRFP Reports) for the Funds as required by National Instrument 81-106 -- Investment Fund Continuous Disclosure (NI 81-106) in time for their due date for filing of October 28, 2005. This is the first occasion that MRFP Reports are being prepared for the Funds pursuant to NI 81-106 and staff of the Manager are being trained and becoming acquainted for the first time with the requirements in this regard. These members of the Manager's staff are also the individuals with the requisite knowledge for the simplified prospectus and annual information form of the Funds and, therefore, would be intimately involved with their preparation. Notwithstanding the extensive numbers of staff members in the affected departments, the Manager has had to hire additional personnel to ensure it can complete the MRFP Reports within the regulatory timeframes. Costs of these additional personnel are charged to the Funds as fund operating expenses.

(f) Notwithstanding the hiring of additional personnel, it is not anticipated that the MRFP Reports will be ready for filing before late October and in any event on a date after October 10, 2005 which is the due date for the filing of the final renewal Prospectus.

(g) Section 7.4 of National Instrument 81-101 -- Mutual Fund Prospectus Disclosure (NI 81-101) provides that Items 8, 11 and 13.1 of Part B of Form 81-101F1 do not apply to a mutual fund that has filed a MRFP Report pursuant to NI 81-106.

(h) Based on the current requirement to file a final prospectus for the Funds by October 10, 2005, and the MRFP Reports by October 28, 2005, the Funds must provide each Fund's principal holdings, past performance and financial highlights in both the Prospectus as well as in the MRFP Reports. Doing so would in many respects be duplicative and there are also differences in the content and manner of presentation of the information in the Prospectus and MRFP Reports.

(i) If the Funds are required to provide disclosure in both the Prospectus and MRFP Reports, it will require that the resources the Manager has available will be spending unnecessary time and incurring additional costs in preparing information for disclosure in the Prospectus which, pursuant to section 7.4 of NI 81-101, will no longer be required once the MRFP Reports have been filed.

(j) Since September 30, 2004, the date of the Prospectus, apart from amendments that have been made to the Prospectus, no undisclosed material change has occurred. Accordingly, the Prospectus, as amended, provides accurate information regarding the Funds. The extension requested will not affect the currency or accuracy of the information contained in the Prospectus, as amended, and accordingly, will not be prejudicial to the public interest.

Decision

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 under the Legislation is that the Requested Relief is granted provided a simplified prospectus is filed no later than 10 days after October 31, 2005 and that a receipt for the simplified prospectus is obtained no later than 20 days after October 31, 2005.

Yours truly,

"Leslie Byberg"
Manager, Investment Funds
Ontario Securities Commission

 

SCHEDULE "A"

List of Funds

Mackenzie Cundill Canadian Security Capital Class
MacKenzie Ivy Canadian Capital Class
Mackenzie Ivy Enterprise Capital Class
Mackenzie Maxxum Canadian Equity Growth Capital Class
Mackenzie Maxxum Canadian Value Capital Class
Mackenzie Maxxum Dividend Capital Class
Mackenzie Select Managers Canada Capital Class
Mackenzie Universal Canadian Growth Capital Class
Mackenzie Universal Future Capital Class
Mackenzie Cundill American Capital Class
Mackenzie Select Managers USA Capital Class
Mackenzie Universal American Growth Capital Class
Mackenzie Universal U.S. Blue Chip Capital Class
Mackenzie Universal U.S. Emerging Growth Capital Class
Mackenzie Universal U.S. Growth Leaders Capital Class
Mackenzie Cundill Value Capital Class
Mackenzie Ivy European Capital Class
Mackenzie Ivy Foreign Equity Capital Class
Mackenzie Select Managers Capital Class
Mackenzie Select Managers Far East Capital Class
Mackenzie Select Managers International Capital Class
Mackenzie Select Managers Japan Capital Class
Mackenzie Universal Emerging Markets Capital Class
Mackenzie Universal European Opportunities Capital Class
Mackenzie Universal Global Future Capital Class
Mackenzie Universal Growth Trends Capital Class
Mackenzie Universal International Stock Capital Class
Mackenzie Universal Sustainable Opportunities Capital Class
Mackenzie Universal Emerging Technologies Capital Class
Mackenzie Universal Financial Services Capital Class{•}
Mackenzie Universal Health Sciences Capital Class
Mackenzie Universal World Precious Metals Capital Class
Mackenzie Universal World Real Estate Capital Class
Mackenzie Universal Resource Capital Class
Mackenzie Universal World Science & Technology Capital Class
Mackenzie Sentinel Canadian Managed Yield Capital Class
Mackenzie Sentinel Managed Return Capital Class
Mackenzie Sentinel U.S. Managed Yield Capital Class

{•} Subject to shareholder approval, Mackenzie Universal Financial Services Capital Class will undergo a name change on August 30, 2005 to Mackenzie Maxxum Global Explorer Capital Class