CI Investments Inc.

Decision

Headnote

National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- relief granted to conventional mutual fund series of exchange-traded funds for continuous distribution of securities -- relief granted to facilitate the offering of conventional mutual fund series and exchange-traded series within same fund structure -- relief granted from the requirement in NI 81-101 to prepare and file a simplified prospectus for mutual fund series provided that a Long Form Prospectus is prepared and filed in accordance with NI 41-101 -- mutual fund series and exchange-traded series referable to same portfolio and have substantially identical disclosure -- relief permitting all series of funds to be disclosed in same prospectus -- disclosure required by NI 81-101 for mutual fund series and not contemplated by NI 41-101 will be disclosed in prospectus under relevant headings -- technical relief granted to funds from Parts 9, 10 and 14 of National Instrument 81-102 to permit funds to treat exchange-traded series in a manner consistent with treatment of other exchange-traded fund securities in continuous distribution in connection with their compliance with Parts 9, 10 and 14 of NI 81-102 -- relief permitting funds to treat mutual fund series in a manner consistent with treatment of other conventional mutual fund securities in connection with their compliance with Parts 9, 10 and 14 of NI 81-102.

Applicable Legislative Provisions

National Instrument 41-101 General Prospectus Requirements, s. 19.1.

National Instrument 81-102 -- Investment Funds, s. 19.1.

December 19, 2019

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 CI INVESTMENTS INC. (the Filer)

DECISION

Background

The principal regulator in the Jurisdiction has received an application from the Filer on behalf of the funds listed in Schedule A (collectively, the Existing Funds), and such other mutual funds as are managed or may be managed by the Filer now, or in the future, and that are structured in the same manner as the Existing Funds (the Future Funds, and together with the Existing Funds, the Funds, and each individually, a Fund), for a decision under the securities legislation of the Jurisdiction (the Legislation) to permit the Filer and each Fund to

(a) file a prospectus for the Mutual Fund Securities (as defined below) of each Fund in accordance with the provisions of National Instrument 41-101 General Prospectus Requirements (NI 41-101) and in the form prescribed by Form 41-101F2 Information Required in an Investment Fund Prospectus (Form 41-101F2) instead of preparing and filing a simplified prospectus and annual information form for the Mutual Fund Securities in accordance with the provisions of National Instrument 81-101 Mutual Fund Prospectus Disclosure (NI 81-101) and the forms prescribed by Form 81-101F1 Contents of Simplified Prospectus (Form 81-101F1) and Form 81-101F2 Contents of Annual Information Form (Form 81-101F2) (the Simplified Prospectus Form Requirements); and

(b) permit the Filer and each Fund to treat the ETF Securities (as defined below) and the Mutual Fund Securities as if such securities were separate funds in connection with their compliance with the provisions of Parts 9, 10 and 14 of National Instrument 81-102 Investment Funds (NI 81-102) (the Sales and Redemption Requirements),

(collectively, the Exemption Sought).

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 Filer has provided notice that subsection 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 Ontario (together with Ontario, the Jurisdictions).

Interpretation

Terms defined in National Instrument 14-101 Definitions, MI 11-102 and National Instrument 81-102 Investment Funds (NI 81-102) have the same meaning if used in this decision, unless otherwise defined.

Affiliate Dealer means a registered dealer that is an affiliate of an Authorized Dealer or Designated Broker and that participates in the re-sale of Creation Units (as defined below) from time to time.

Authorized Dealer means a registered dealer that has entered, or intends to enter, into an agreement with the manager of a Fund authorizing the dealer to subscribe for, purchase and redeem Creation Units from one or more Funds on a continuous basis from time to time.

Basket of Securities means, in relation to a Fund, a group of securities or assets representing the constituents of the Fund.

Designated Broker means a registered dealer that has entered, or intends to enter, into an agreement with the Filer or an affiliate of the Filer to perform certain duties in relation to the ETF Securities, including the posting of a liquid two-way market for the trading of the Fund's ETF Securities on the TSX, the NEO or another Marketplace (as defined below).

ETF Facts means a prescribed summary disclosure document required pursuant to NI 41-101, in respect of one or more classes of ETF Securities being distributed under a prospectus.

ETF Securities means securities of an ETF class of a Fund that are listed or will be listed on the TSX, the NEO or another Marketplace and that will be distributed pursuant to a prospectus prepared in accordance with NI 41-101 and Form 41-101F2.

Fund Facts means a prescribed summary disclosure document required pursuant to NI 81-101, in respect of one or more classes of Mutual Fund Securities being distributed under a prospectus.

Marketplace means a "marketplace" as defined in National Instrument 21-101 Marketplace Operation that is located in Canada.

Mutual Fund Securities means securities of a non-exchange-traded class of a Fund that are or will be distributed pursuant to a simplified prospectus prepared in accordance with NI 41-101 and Form 41-101F2.

NEO means the NEO Exchange Inc.

Prescribed Number of ETF Securities means, in relation to a Fund, the number of ETF Securities of the Fund determined by the Filer from time to time for the purpose of subscription orders, exchanges, redemptions or for other purposes.

Securityholders means beneficial and registered holders of ETF Securities or Mutual Fund Securities, as applicable.

TSX means the Toronto Stock Exchange.

Representations

This decision is based on the following facts represented by the Filer:

The Filer

1. The Filer is a corporation amalgamated under the laws of Canada, with its head office in Toronto, Ontario.

2. The Filer is registered as follows:

(a) under the securities legislation of all provinces and territories as a portfolio manager;

(b) under the securities legislation of Ontario, Quebec and Newfoundland and Labrador as an investment fund manager;

(c) under the securities legislation of all provinces and territories as an exempt market dealer; and

(d) under the Commodity Future Act (Ontario) as a commodity trading counsel and a commodity trading manager.

2. The Filer is or will be the investment fund manager and portfolio manager of the Funds. The Filer has applied, or will apply, to list the ETF Securities on the TSX, the NEO or another Marketplace.

3. The Filer is not in default of securities legislation in any of the Jurisdictions.

The Funds

4. Each Fund is or will be a mutual fund structured as a trust or a corporation or class thereof that is governed by the laws of the Province of Ontario. Each Fund is, or will be, a reporting issuer in the Jurisdiction(s) in which its securities are distributed.

5. Each Fund offers, or will offer, ETF Securities, and may in the future also offer Mutual Fund Securities.

6. Subject to any exemptions that have been, or may be, granted by the applicable securities regulatory authorities, each Fund will be an open-ended mutual fund subject to NI 81-102.

7. The ETF Securities are or will be listed on the TSX, the NEO or another Marketplace. The Filer will not file a final prospectus for any of the Funds in respect of the ETF Securities until the TSX, the NEO or other applicable Marketplace has conditionally approved the listing of the ETF Securities.

8. Mutual Fund Securities will not be listed on the TSX, the NEO, or another Marketplace.

9. The Filer has filed, or will file, a long form prospectus prepared and filed in accordance with NI 41-101 and Form 41-101F2 on behalf of the Funds in respect of the ETF Securities, subject to any exemptions that may be granted by the applicable securities regulatory authorities.

10. ETF Securities and Mutual Fund Securities, if any, are, or will be, distributed on a continuous basis in one or more of the Jurisdictions under a prospectus.

11. ETF Securities may generally only be subscribed for, or purchased directly from, the Funds (Creation Units) by Authorized Dealers or Designated Brokers. Generally, subscriptions or purchases may only be placed for a Prescribed Number of ETF Securities (or a multiple thereof) on any day when there is a trading session on the TSX, the NEO or other Marketplace. Authorized Dealers or Designated Brokers subscribe for Creation Units for the purpose of facilitating investor purchases of ETF Securities on the TSX, the NEO or another Marketplace.

12. In addition to subscribing for and re-selling Creation Units, Authorized Dealers, Designated Brokers and Affiliate Dealers are also generally engaged in purchasing and selling ETF Securities of the same class or series as the Creation Units in the secondary market. Other Dealers may also be engaged in purchasing and selling ETF Securities of the same class or series as the Creation Units in the secondary market despite not being an Authorized Dealer, Designated Broker or Affiliate Dealer.

13. Each Fund has appointed or will appoint, at any given time, a Designated Broker to perform certain other functions, which include standing in the market with a bid and ask price for ETF Securities for the purpose of maintaining liquidity for the ETF Securities.

14. Except for Authorized Dealer and Designated Broker subscriptions for Creation Units, as described above, ETF Securities generally are not able to be purchased directly from a Fund. Investors are generally expected to purchase and sell ETF Securities, directly or indirectly, through dealers executing trades through the facilities of the TSX, the NEO or another Marketplace. ETF Securities may also be issued directly to Securityholders upon a reinvestment of distributions of income or capital gains.

15. Securityholders that are not Designated Brokers or Authorized Dealers that wish to dispose of their ETF Securities may generally do so by selling their ETF Securities on the TSX, the NEO or other Marketplace, through a registered dealer, subject only to customary brokerage commissions. A Securityholder that holds a Prescribed Number of ETF Securities or multiple thereof may exchange such ETF Securities for Baskets of Securities and/or cash in the discretion of the Filer. Securityholders may also redeem ETF Securities for cash at a redemption price equal to 95% of the closing price of the ETF Securities on the TSX, the NEO or other Marketplace on the date of redemption, subject to a maximum redemption price of the applicable net asset value per ETF Security.

16. Mutual Fund Securities may be subscribed for or redeemed directly from a Fund through qualified financial advisors or brokers.

17. The Existing Funds are not in default of securities legislation in any of the Jurisdictions.

Simplified Prospectus Form Requirements

17. Without the Exemption Sought, when the Filer decides to offer Mutual Fund Securities of a Fund that has ETF Securities, it would be required to prepare and file a prospectus pursuant to NI 81-101 in respect of those Mutual Fund Securities. This would be in addition to the prospectus that would need to be filed and prepared pursuant to NI 41-101 in respect of the ETF Securities of the Fund.

18. The Filer believes it is more efficient and expedient to include all of the classes of each Fund, including ETF Securities and Mutual Fund Securities of a Fund, in one prospectus form instead of two different prospectus forms. The Filer also believes that this presentation will assist in providing full, true and plain disclosure of all material facts relating to the securities of the Funds, by permitting disclosure relating to all classes of securities to be included in one prospectus. The Filer has already filed a long form prospectus in respect of the Existing Funds, and proposes to continue to file long form prospectuses in respect of Future Funds.

19. The Filer will ensure that any additional disclosure included in the prospectus relating to the Mutual Fund Securities will not interfere with an investor's ability to differentiate between the Mutual Fund Securities and the ETF Securities and their respective attributes. Accordingly, in order to provide clarity to investors, the Filer will amend the names of the Existing Funds that intend to offer Mutual Fund Securities by replacing the word "ETF" with "Fund". In addition, the existing ETF Securities of the Funds will be redesignated as "ETF Class Units" and Mutual Fund Securities, if any, will be designated as "Mutual Fund Class Units", as applicable.

20. The Funds will file Fund Facts in the form prescribed by Form 81-101F3 Contents of Fund Facts Document in respect of any Mutual Fund Securities, and will continue to file ETF Facts in the form prescribed by Form 41-101F4 in respect of any ETF Securities.

21. The Funds will comply with the provisions of NI 41-101 when filing any amendment or prospectus.

22. The Mutual Fund Securities of each Fund will continue to be subject to the prospectus and Fund Facts delivery obligations set out in NI 81-101.

Sales and Redemption Requirements

23. Parts 9, 10 and 14 of NI 81-102 do not contemplate both Mutual Fund Securities and ETF Securities being offered in a single fund structure. Accordingly, without the Exemption Sought from the Sales and Redemption Requirements, the Filer and the Funds would not be able to technically comply with those parts of the Instrument.

24. The Exemption Sought from the Sales and Redemption Requirements will permit the Filer and the Funds to treat the ETF Securities and the Mutual Fund Securities as if such securities were separate funds in connection with their compliance with Parts 9, 10 and 14 of NI 81-102. The Exemption Sought from the Sales and Redemption Requirements will enable each of the ETF Securities and Mutual Fund Securities to comply with Parts 9, 10 and 14 of NI 81-102, as appropriate, for the type of security being offered.

Decision

The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.

1. The decision of the principal regulator is that the Exemption Sought from the Simplified Prospectus Form Requirements is granted, provided that:

(a) the Fund offers both Mutual Fund Securities and ETF Securities;

(b) the Filer files a long form prospectus in respect of the Mutual Fund Securities in accordance with the requirements of NI 41-101 and Form 41-101F2, other than the requirements pertaining to the filing of an ETF Facts document;

(c) the Filer includes disclosure required pursuant to Form 81-101F1 and Form 81-101F2 (that is not contemplated by NI 41-101F2) in respect of the Mutual Fund Securities in each Fund's prospectus, as applicable; and

(d) the Filer includes disclosure regarding this decision under the heading "Exemptions and Approvals" in each Fund's prospectus.

2. The decision of the principal regulator is that the Exemption Sought from the Sales and Redemption Requirements is granted, provided that:

(a) with respect to its Mutual Fund Securities, each Fund complies with the provisions of Parts 9, 10 and 14 of NI 81-102 that apply to mutual funds that are not exchange-traded mutual funds; and

(b) with respect to its ETF Securities, each Fund complies with the provisions of Parts 9 and 10 of NI 81-102 that apply to exchange-traded mutual funds.

"Darren McKall"
Manager, Investment Funds & Structured Products Branch
Ontario Securities Commission

SCHEDULE A

EXISTING FUNDS

1. CI First Asset 1-5 Year Laddered Government Strip Bond Index ETF

2. CI First Asset Active Canadian Dividend ETF

3. CI First Asset Active Credit ETF

4. CI First Asset Active Utility & Infrastructure ETF

5. CI First Asset Canadian Buyback Index ETF

6. CI First Asset Canadian Convertible Bond ETF

7. CI First Asset Canadian REIT ETF

8. CI First Asset CanBanc Income Class ETF

9. CI First Asset Core Canadian Equity Income Class ETF

10. CI First Asset Energy Giants Covered Call ETF

11. CI First Asset Enhanced Government Bond ETF

12. CI First Asset Enhanced Short Duration Bond ETF

13. CI First Asset European Bank ETF

14. CI First Asset Global Asset Allocation ETF

15. CI First Asset Global Financial Sector ETF

16. CI First Asset Gold+ Giants Covered Call ETF (formerly CI First Asset Can-Materials Covered Call ETF)

17. CI First Asset Health Care Giants Covered Call ETF

18. CI First Asset High Interest Savings ETF

19. CI First Asset Investment Grade Bond ETF

20. CI First Asset Long Duration Fixed Income ETF

21. CI First Asset Morningstar Canada Dividend Target 30 Index ETF

22. CI First Asset Morningstar Canada Momentum Index ETF

23. CI First Asset Morningstar Canada Value Index ETF

24. CI First Asset Morningstar International Momentum Index ETF

25. CI First Asset Morningstar International Value Index ETF

26. CI First Asset Morningstar National Bank Quebec Index ETF

27. CI First Asset Morningstar US Dividend Target 50 Index ETF

28. CI First Asset Morningstar US Momentum Index ETF

29. CI First Asset Morningstar US Value Index ETF

30. CI First Asset MSCI Canada Low Risk Weighted ETF

31. CI First Asset MSCI Canada Quality Index Class ETF

32. CI First Asset MSCI Europe Low Risk Weighted ETF

33. CI First Asset MSCI International Low Risk Weighted ETF

34. CI First Asset MSCI USA Low Risk Weighted ETF

35. CI First Asset MSCI World ESG Impact ETF

36. CI First Asset MSCI World Low Risk Weighted ETF

37. CI First Asset Preferred Share ETF

38. CI First Asset Short Term Government Bond Index Class ETF

39. CI First Asset Tech Giants Covered Call ETF

40. CI First Asset U.S. Buyback Index ETF

41. CI First Asset U.S. Trendleaders Index ETF

42. CI First Asset US & Canada Lifeco Income ETF