National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Relief granted to mutual fund for extension of lapse date of prospectus for 34 days -- Lapse date extended to permit updating of the disclosure across the fund family -- Extension of lapse date will not affect the currency or accuracy of the information contained in the prospectus -- Securities Act (Ontario).
Applicable Legislative Provisions
Securities Act, R.S.O. 1990, c. S.5, as am., s. 62(5).
July 31, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction) AND IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS AND IN THE MATTER OF FIDELITY INVESTMENTS CANADA ULC (the Manager) AND IN THE MATTER OF FIDELITY FLOATING RATE HIGH INCOME FUND (the Fund and, together with the Manager, the Filers)
The principal regulator in the Jurisdiction has received an application from the Filers for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption that the time limits pertaining to filing the renewal prospectus of the Fund be extended as if the lapse date of the simplified prospectus and annual information form dated September 26, 2013 of the Fund (the Renewal Prospectus) is October 30, 2014 (the Requested Relief).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application; and
(b) the Filers have provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in all of the provinces and territories of Canada other than the Jurisdiction (collectively, with the Jurisdiction, the Jurisdictions).
Defined terms contained in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless they are defined in this decision.
This decision is based on the following facts represented by the Filers:
1. The Fund is a reporting issuer (or the equivalent) as defined in the securities legislation of each of the Jurisdictions.
2. The Filers are not in default of securities legislation in any of the Jurisdictions.
3. The Fund currently distributes its securities in the Jurisdictions pursuant to a simplified prospectus dated September 26, 2013 (the Prospectus).
4. Amended fund facts that incorporate the requirements of Form 81-101F3 that came into effect on January 13, 2014 were filed on behalf of the Fund on April 28, 2014 (the Fund Facts).
5. The lapse date of the Prospectus under the Legislation is September 26, 2014. Accordingly, under the Legislation, the distribution of securities of the Fund would have to cease on September 26, 2014 unless: (i) the Fund files a pro-forma simplified prospectus at least 30 days prior to September 26, 2014; (ii) the final simplified prospectus is filed no later than 10 days after September 26, 2014; and (iii) a receipt for the final simplified prospectus is obtained within 20 days of September 26, 2014.
6. The Manager is registered as a portfolio manager and mutual fund dealer in each of the provinces and territories of Canada and is registered under the Commodity Futures Act (Ontario) in the category of commodity trading manager. The Manager is also registered as an investment fund manager in the provinces of Ontario, Newfoundland and Labrador, and Quebec.
7. The Manager is the manager of the Fund and approximately 96 mutual funds (the Affiliated Funds) that currently distribute their securities to the public under a simplified prospectus and annual information form (filed on SEDAR under Project No. 2112406), which has October 30, 2014 as its lapse date under the Legislation.
8. The Affiliated Funds share many common operational and administrative features with the Fund and combining them in the same prospectus booklet will allow investors to more easily compare the features of the Affiliated Funds and the Fund.
9. It would be impractical to alter and modify all the dedicated systems, procedures and resources required to prepare the renewal prospectus, annual information form and fund facts for the Affiliated Funds, and unreasonable to incur the costs and expenses associated therewith, so that the renewal prospectus for the Affiliated Funds can be filed earlier with the renewal prospectus for the Fund.
10. The Manager may make minor changes to the features of the Affiliated Funds as part of the process of renewing the Affiliated Funds' prospectus in October 2014. The ability to file the Renewal Prospectus with those of the Affiliated Funds will ensure that the Manager can make the operational and administrative features of the Fund and the Affiliated Funds consistent with each other.
11. There have been no material changes in the affairs of the Fund since the date of the Prospectus. Accordingly, the Prospectus represents current information regarding the Fund. In addition, the Fund Facts filed on April 28, 2014 provides even more current information to investors regarding the Fund.
12. After June 13, 2014, new investors will receive delivery of the Fund Facts. The Prospectus will still be available upon request.
13. The Requested Relief will not affect the accuracy of the information in the Prospectus or the Fund Facts and therefore will not be prejudicial to the public interest.
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Requested Relief is granted.