National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Mutual funds granted relief from filing the annual management report of fund performance.
Applicable Legislative Provisions
National Instrument 81-106 Investment Fund Continuous Disclosure, s. 4.2, 5.1(2)(c).
March 29, 2010
IN THE MATTER OF
THE SECURITIES LEGISLATION OF
QUÉBEC AND ONTARIO
IN THE MATTER OF
THE PROCESS FOR EXEMPTIVE RELIEF
APPLICATIONS IN MULTIPLE JURISDICTIONS
IN THE MATTER OF
O'LEARY FUNDS MANAGEMENT LP
O'LEARY CANADIAN EQUITY YIELD FUND,
O'LEARY CANADIAN BALANCED YIELD FUND,
O'LEARY CANADIAN BOND YIELD FUND,
O'LEARY GLOBAL EQUITY YIELD FUND,
O'LEARY GLOBAL BALANCED YIELD FUND,
O'LEARY GLOBAL BOND YIELD FUND,
O'LEARY GLOBAL INFRASTRUCTURE YIELD FUND
AND O'LEARY MONEY MARKET YIELD FUND
(each a Fund or collectively, the Funds)
The securities regulatory authority or regulator in each of the Jurisdictions (Decision Makers) have received an application from the Manager, on behalf of each of the Funds for a decision under the securities legislation of the Jurisdictions (the Legislation) for an exemption, pursuant to section 17.1 of National Instrument 81-106 -- Investment Fund Continuous Disclosure (NI 81-106), from:
(a) the requirement contained in section 4.2 of NI 81-106 to file a management report of fund performance (MRFP) for the financial year ended December 31, 2009; and
(b) the requirement contained in paragraph 5.1(2)(c) of NI 81-106 to deliver to securityholders the MRFP for the financial year ended December 31, 2009.
(collectively, the Requested Relief).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a dual application):
(a) the Autorité des marchés financiers is the principal regulator for this application,
(b) the Manager has provided notice that paragraph 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in British Columbia, Alberta, Saskatchewan, Manitoba, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland and Labrador; and
(c) the decision is the decision of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.
Terms defined in National Instrument 14-101 -- Definitions MI 11-102 have the same meaning if used in this decision, unless otherwise defined. The following additional terms shall have the following meanings:
Form 81-106F1 means the form in NI 81-106 that prescribes the content disclosure required in an annual or interim management report of fund performance;
NI 81-102 means National Instrument 81-102 Respecting Mutual Funds;
Provinces of Canada means British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Québec, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland and Labrador.
This decision is based on the following facts represented by the Manager:
1. The Manager is a limited partnership formed under the laws of Ontario, with its head office in Montreal, Québec.
2. The Manager is the manager and the trustee of each of the Funds.
3. The Funds are open-ended mutual fund trusts established under the laws of Ontario pursuant to a Declaration of Trust dated December 16, 2009.
4. Each Fund became a reporting issuer under applicable securities legislation of the Provinces of Canada on December 17, 2009, following the issuance of a receipt by the principal regulator for the final simplified prospectus and annual information form of the Funds dated December 16, 2009.
5. None of the Funds or the Manager are in default of securities legislation in any of the Provinces of Canada.
6. As at December 16, 2009, only one series A unit of each Fund was issued for a consideration of $10 to the Manager, as reflected in the audited statements of net assets of the Funds, which have been filed at the time of the filing of the final simplified prospectus and annual information form of the Funds.
7. The initial fiscal year end of each Fund is December 31, 2009.
8. As at December 31, 2009, no units of the Funds were issued to the public because, pursuant to paragraph 3.1(1)(b) of NI 81-102, each Fund is prohibited from issuing units unless subscriptions aggregating not less than $500,000 have been received by such Fund from investors other than the Manager and certain other parties specified in paragraph 3.1(1)(b) of NI 81-102.
9. As at December 31, 2009, the Manager was the sole unitholder in each of the Funds.
10. As at December 31, 2009 each Fund solely held cash in its portfolio.
11. In the absence of the Requested Relief, the Funds would be required to file and deliver an MRFP for the financial year ended December 31, 2009.
12. Given the limited activities of the Funds for the period December 17, 2009 to December 31, 2009 and given that the units of the Funds were not offered to the public as of December 31, 2009, no significant information or financial highlights can be provided for the purposes of the preparation of an MRFP as prescribed Form 81-106F1.
Each of the Decision Makers is satisfied that the decision meets the test set out in the Legislation for the Decision Maker to make the decision.
The decision of the Decision Makers under the Legislation is that the Requested Relief is granted provided that:
i) the Manager will prepare for each Fund an MRFP for the period ending June 30, 2010 in accordance with Form 81-106F1, except that they will include financial highlights as required by Part B, Item 3 of Form 81-106F1.