Overview

The Portfolio Management Association of Canada (PMAC), is pleased to have the opportunity to submit the following comments regarding the CSA Notice and Request for Comment – Proposed Amendments to National Instrument 41-101 General Prospectus Requirements, National Instrument 81-101 Mutual Fund Prospectus Disclosure, and Related Proposed Consequential Amendments and Changes and Consultation Paper on a Base Shelf Prospectus Filing Model for Investment Funds in Continuous Distribution – Modernization of the Prospectus Filing Model for Investment Funds (Consultation).

PMAC represents over 300 investment management firms registered to do business in Canada as portfolio managers (PMs) with the members of the Canadian Securities Administrators (CSA). In addition to this primary registration, 70% of our members are also registered as investment fund managers (IFMs) and/or exempt market dealers (EMDs). Some member firms manage large mutual funds or pooled products, and others manage separately managed accounts on behalf of private clients or institutions such as pension plans and foundations. PMAC’s members encompass both large and small firms and manage total assets in excess of $3 trillion.

Key Recommendations

1. Do not require prospectus amendments to be filed as an amended and restated prospectus. The CSA’s stated purpose for the proposed biennial prospectus renewal cycle is to reduce regulatory burden. The proposed elimination of the “slip sheet” amendment system will remove all burden reduction benefits of the proposed changes and will create significant additional regulatory burden for firms. We strongly urge the CSA not to require an amended and restated prospectus for every prospectus amendment. The costs of doing this far outweigh the benefits of the proposed biennial renewal. The slip sheet system for amendments should be retained.
2. Provide additional detail on the Base Shelf Prospectus proposal for further consultation. The questions included in the Consultation are premature. The proposal does not include sufficient detail as to how the proposed system would work to allow members to provide meaningful comment.

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