CSA Provide Status Update On Mutual Fund Fee Structure Consultation

The CSA yesterday released a status report on their mutual fund fee consultation initiative. As we discussed last year, the CSA released a discussion paper in December 2012 identifying investor protection and fairness issues resulting from the Canadian mutual fund fee structure and soliciting feedback on the current structure.

Today's report identifies a number of key themes emanating from the consultation process from the point of view of industry and investors. According to industry stakeholders (i) there is no evidence of investor harm warranting a change of the current fee structure; (ii) a ban on embedded compensation would have unintended consequences, including with respect to reduced access to advice for small retail investors and the creation of an unlevel playing field among competing products; and (iii) the impact of domestic and international reforms should be assessed prior to moving ahead with further proposals.