New Risk Classification Methodology For Mutual Funds And Etfs — September 1, 2017 With Phased-In Disclosure

Under new rules finalized by the Canadian Securities Administrators (CSA) on December 8, 2016, Canadian fund managers must adopt by September 1, 2017, a new prescribed risk classification methodology to determine the investment risk levels of the publicly offered mutual funds and exchange-traded funds (ETFs) they manage. Disclosure of the applicable investment risk level must be included in a fund's next prospectus filing made after September 1, 2017, although the disclosure can be made, and the methodology can be adopted, earlier.

Final amendments to National Instrument 81-102 Investment Funds, National Instrument 81-101 Mutual Fund Prospectus Disclosure and National Instrument 41-101 General Prospectus Requirements come into force on March 8, 2017, with a phased-in transition period. The rule amendments can be found here and here.¹