R.E.G.A.R. Gestion Privée Inc.

Headnote

National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Existing investment funds granted an exemption from paragraphs 2.5(2)(a), 2.5(2)(a.1) and 2.5(2)(c) of National Instrument 81-102 Investment Funds to invest up to 10% of net assets in UCITS Funds governed by the United Kingdom, the Republic of Ireland, Germany and/or Luxembourg -- Underlying foreign funds are subject to similar investment restrictions and disclosure requirements as top funds -- Relief granted subject to conditions.

Applicable Legislative Provisions

National Instrument 81-102 Investment Funds, ss. 2.5(2)(a); (a.1); and (c).

April 11, 2025

IN THE MATTER OF
THE SECURITIES LEGISLATION
OF QUÉBEC AND ONTARIO
(the Jurisdictions)

AND

IN THE MATTER OF
THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS
IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF
R.E.G.A.R. GESTION PRIVÉE INC.
(the Filer)

DECISION

Background

The securities regulatory authority or regulator in each of the Jurisdictions (the Decision Makers) has received an application (the Application) from the Filer whereby the Filer requests, on behalf of the Funds (as defined below), a decision under the securities legislation of the Jurisdictions (as defined below) (the Legislation) for the Funds to obtain exemptive relief from:

a. paragraphs 2.5(2)(a) and (a.1) of National Instrument 81-102 Investment Funds, which in Québec is a regulation (NI 81-102), to permit each Fund to purchase and/or hold securities of UCITS (as defined below) even though the UCITS are not subject to NI 81-102; and

b. paragraph 2.5(2)(c) of NI 81-102 to permit each Fund to purchase and/or hold securities of UCITS even though the UCITS are not reporting issuers in any province or territory of Canada (collectively, the Exemption Sought).

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a dual application):

a. the Autorité des marchés financiers (AMF) is the principal regulator for this Application;

b. the Filer has provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102), which in Québec is a regulation, is intended to be relied upon in each of the other provinces and territories of Canada (together with the Jurisdictions, the Canadian Jurisdictions); and

c. the decision is the decision of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.

Interpretation

Terms defined in National Instrument 14-101Definitions, which in Québec is a regulation, MI 11-102, NI 81-102 and National Instrument 81-106 Investment Fund Continuous Disclosure, which in Québec is a regulation (NI 81-106) have the same meaning if used in this decision, unless otherwise defined.

In addition, in this decision the following terms have the following meanings:

Funds means SectorWise Conservative Portfolio, SectorWise Balanced Portfolio, SectorWise Growth Portfolio, GreenWise Conservative Portfolio, GreenWise Balanced Portfolio, GreenWise Growth Portfolio and RGP Alternative Income Portfolio (each, a "Fund").

KIID means a UCITS's Key Investor Information Document that contains disclosure similar to that required to be included in a fund facts document prepared under NI 81-101.

NI 41-101 means National Instrument 41-101 General Prospectus Requirements, which in Québec is a regulation.

NI 81-101 means National Instrument 81-101Mutual Fund Prospectus Disclosure, which in Québec is a regulation.

UCITS means Undertaking for Collective Investments in Transferable Securities and refers to the investment funds authorized under the UCITS Regulations (as defined below) and subject to the supervision of a national competent authority in the United Kingdom (UK), the Republic of Ireland, Germany and/or Luxembourg.

Representations

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

The Filer

1. The Filer is a corporation established under the laws of Québec, and the head office of the Filer is in Québec, Québec.

2. The Filer is registered as an investment fund manager (IFM) in the provinces of Newfoundland and Labrador, Ontario and Québec, and as portfolio manager in the provinces of Ontario and Québec.

3. The Filer, or an affiliate of the Filer, acts as the IFM of the Funds.

4. The Filer is not in default of the Legislation in any of the Canadian Jurisdictions.

The Funds

5. Each Fund is an investment fund organized and governed by the laws of Canada or one of the Canadian Jurisdictions.

6. Each Fund is a reporting issuer in one or more of the Canadian Jurisdictions.

7. Each Fund is governed by the applicable provisions of NI 81-102, subject to any relief therefrom that have been, or may in the future be, granted by the securities regulatory authorities.

8. The Funds are not in default of the Legislation in any of the Canadian Jurisdictions.

9. Each investment by a Fund in securities of a UCITS will be made in accordance with the investment objectives of the Fund and will represent the business judgment of responsible persons uninfluenced by considerations other than the best interests of the Fund.

10. Subject to compliance with NI 81-102, the investment objectives and strategies of each Fund will permit the Fund to invest in securities of the UCITS.

The UCITS

11. Each UCITS is, or will be, managed by an unrelated third party.

12. Each UCITS (a) has, or will have, a primary purpose to invest money provided by its securityholders and (b) has, or will have, securities that entitle its securityholders to receive on demand, or within a specified period after demand, an amount computed by reference to the value of a proportionate interest in the net assets of such UCITS.

13. Each UCITS is, or will be, an "investment fund" and "mutual fund" within the meaning of the Legislation.

14. No UCITS is, or will be, subject to NI 81-102 and no UCITS distributes, or will distribute, its securities in Canada under a simplified prospectus in accordance with NI 81-101.

15. The UCITS are "investment funds" and "mutual funds" within the meaning of applicable Canadian securities legislation. The UCITS are subject to investment restrictions and practices that are substantially similar to those applicable to the Funds. The UCITS are available for purchase by the public and are generally not considered hedge funds.

16. The UCITS are distributed in certain European countries pursuant to:

a. the European Union Directive 2009/65/EC on the coordination of laws, regulations and administrative provisions relating to UCITS as regards depositary functions, remuneration policies and sanctions as amended and supplemented with further European Union (EU) legislation and as implemented in the EU member state where the UCITS is domiciled or Ireland with regards to Irish-domiciled UCITS, Germany with regards to German-domiciled UCITS and Luxembourg with regards to Luxembourg-domiciled UCITS; or

b. with respect to U.K. UCITS, the EU UCITS Regulations as retained in UK law in accordance with the European Union (Withdrawal) Act 2018 (together with paragraph a), above, the UCITS Regulations). Each U.K. UCITS therefore is, or will be, a UCITS and will comply with the UCITS Regulations.

17. The UCITS are, or will be, distributed in certain European countries pursuant to MiFID II (together with Regulation (EU) No. 600/2014) and globally where permissible, pursuant to applicable local law (including private placement regimes).

18. Each of the UCITS is, or will be, subject to investment restrictions and practices under the laws of the U.K., the Republic of Ireland, Germany and/or Luxembourg that are applicable to mutual funds that are sold to the general public, and is, or will be, subject to the following regulatory requirements and restrictions, which are generally similar to and as rigorous as the requirements and restrictions set forth in NI 81-102:

a. Each UCITS is subject to a robust risk management framework through prescribed rules on governance, risk, regulation of service providers and safekeeping of assets.

b. Each UCITS is restricted to investing a maximum of 10% of its net assets in a single issuer.

c. Each UCITS is subject to investment restrictions designed to limit its holdings of illiquid securities to 10% or less of its net asset value.

d. Each UCITS holds no more than 10% of its net asset value in securities of other investment funds, including other collective investment undertakings.

e. Each UCITS is subject to investment restrictions designed to limit holdings of transferrable securities which are not listed on a stock exchange or regulated market to 10% or less of the UCITS's net asset value.

f. The rules governing the use of derivatives by the UCITS are comparable to the rules regarding the use of derivatives under NI 81-102 with respect to the types of derivatives allowed to be used, issuer-concentration, risk exposure in connection with mark to market value, the disclosure required in offering documents and the monitoring requirements, and with only a slight difference between the two regimes in connection with counterparty credit ratings (A-1 under NI 81-102 versus an effective rating requirement of A-2 for counterparties which are not regulated as credit institutions under the UCITS Regulations).

g. The rules governing securities lending by the UCITS are comparable to the rules regarding securities lending under NI 81-102 including, the inability to pledge non-cash collateral and the right to immediately recall the securities loaned. The differences between NI 81-102 and the rules pertaining to the UCITS relate to the following: (i) the type and amount of collateral; (ii) the person who may be appointed as agent for securities lending; (iii) the types of securities that may be purchased with collateral received; and (iv) the overall securities lending limits.

h. A UCITS may engage in securities lending activities if provided for in its prospectus or prospectus supplement, as applicable of the UCITS.

i. Each UCITS makes, or will make, its net asset value of its holdings available to the public through at least one price information system (e.g. Bloomberg or Reuters) and all prices are published daily on the Filer's or an affiliate's website, as applicable.

j. The manager and/or affiliate of the manager, as applicable, of each UCITS is required to prepare a prospectus that discloses material facts pertaining to each UCITS. The prospectus provides disclosure that is similar to the disclosure required to be included in a simplified prospectus under NI 81-101 and a prospectus under NI 41-101, although some information, such as annual returns, management expense ratios, trading expense ratios, and trading price and volume, is not included in the prospectus and/or prospectus supplement of a UCITS, as applicable.

k. Each UCITS publishes a KIID which contains disclosure similar to that required to be included in a fund facts document prepared under NI 81-101.

l. Each UCITS is subject to continuous disclosure obligations which are similar to the disclosure obligations of the Funds under NI 81-106.

m. Any material change in the investment objective or material change to the investment policy of a UCITS will only be effected either following the written approval of all securityholders of the UCITS or a resolution of a majority of the voting securityholders of that UCITS at a general meeting, or after securityholders are given 30 days notice of the change.

n. All investment management activities of the investment fund manager for each of the UCITS must be conducted at all times in accordance with the UCITS Regulations and the investment policy of the UCITS.

o. The auditors of each UCITS are required to prepare an audited set of accounts for each UCITS at least annually.

Investment by the Funds in the UCITS

19. The investment objective and strategies of each Fund are, or will be, disclosed in each Fund's simplified prospectus and any Fund that invests in a UCITS will be permitted to do so in accordance with its investment objectives and strategies.

20. In particular, the investment strategies of each Fund stipulate, or will stipulate, that the Fund may invest a portion of its assets in other investment funds, domestic or foreign, which will permit each Fund to invest in a UCITS.

21. The simplified prospectus of each Fund provides, or will provide, all disclosure mandated for investment funds investing in other investment funds.

22. There will be no duplication of management fees or incentive fees as a result of an investment by a Fund in a UCITS.

23. The amount of loss that could result from an investment by a Fund in a UCITS will be limited to the amount invested by the Fund in such UCITS.

24. No sales charges or redemption fees will be paid by a Fund relating to a subscription for, or redemption of, securities of a UCITS.

Reasons for the Exemption Sought

25. A Fund is not permitted to invest in securities of a UCITS unless the requirements of section 2.5(2) of NI 81-102 are satisfied.

26. Section 2.5 of NI 81-102 would permit the Funds to invest in the UCITS but for the fact that each UCITS is not subject to NI 81-102 and is not a reporting issuer in any of the Canadian Jurisdictions.

27. Other than the paragraphs of section 2.5 of NI 81-102 from which the Funds seek relief, the Funds will otherwise comply fully with section 2.5 of NI 81-102 when investing in the UCITS.

28. The Filer believes that it is in the best interests of the Funds that they be permitted to invest in the UCITS because such investment would provide an efficient and cost-effective way for the Funds to achieve diversification and obtain unique exposures to the markets in which the UCITS invest.

29. The investment objectives and strategies of the Funds, which contemplate or will contemplate investment in global or international securities, permit or will permit the allocation of assets to global or international securities. As economic conditions change, the Funds may reallocate assets, including on the basis of asset class or geographic region. A Fund will invest in a UCITS to gain exposure to certain unique securities and strategies in global or international markets in circumstances where it would be in the best interests of the Fund to do so through an investment in an investment fund offered elsewhere rather than through investments in individual securities. For example, a Fund will invest in the UCITS in circumstances where certain investment strategies preferred by the Funds are either not available or not cost-effective to be implemented through investments in individual securities.

30. By investing in the UCITS, the Funds will obtain the benefits of diversification, which would be more expensive and difficult to replicate using individual securities. This will reduce single issuer risk.

31. Investment by a Fund in a UCITS meets, or will meet, the investment objectives of such Fund.

32. A Fund's investment in securities of a UCITS is not for the purpose of distributing the UCITS to the Canadian public. The investment by a Fund in a UCITS is proposed not to allow the UCITS to be indirectly distributed in Canada, but to allow a Fund to achieve its investment objectives and investment strategies by investing in professionally managed funds, where the investment style and approach are known to the manager of the Fund.

33. In the absence of the Exemption Sought the investment restriction in:

a. paragraphs 2.5(2)(a) and 2.5(2)(a.1) of NI 81-102 would prohibit a Fund from purchasing and/or holding securities of a UCITS because the UCITS is not subject to NI 81-102; and

b. paragraph 2.5(2)(c) of NI 81-102 would prohibit a Fund from purchasing and/or holding securities of a UCITS because the UCITS is not a reporting issuer in any of the Canadian Jurisdictions.

34. Each investment by a Fund in securities of UCITS will represent the business judgment of responsible persons uninfluenced by considerations other than the best interests of the Fund.

Decision

Each of the Decision Makers is satisfied that the decision meets the test set out in the Legislation for the Decision Maker to make the decision.

The decision of the Decision Makers under the Legislation is that the Exemption Sought is granted provided that:

(a) the investment by a Fund in securities of a UCITS is made in accordance with the fundamental investment objectives of the Fund;

(b) the UCITS qualify as UCITS and are subject to investment restrictions and practices under the laws that are applicable to mutual funds that are sold to the general public and are regulated investment funds authorized as a UCITS by the applicable national competent authority of the U.K., the Republic of Ireland, Germany, and/or Luxembourg;

(c) the investment by a Fund in a UCITS otherwise complies with section 2.5 of NI 81-102, and the prospectus or a simplified prospectus, as applicable, of the Fund provides, or will provide, all applicable disclosure mandated for investment funds investing in other investment funds;

(d) a Fund does not invest in a UCITS if, immediately after the investment, more than 10% of its net assets, taken at market value at the time of the investment, would consist of investments in UCITS;

(e) the prospectus or simplified prospectus, as applicable, of each applicable Fund discloses, or will disclose in the next renewal of its prospectus following the date of this decision, in the investment strategy section, the fact that the Fund has obtained the Exemption Sought to permit investments in UCITS on the terms described in this decision;

(f) in the event that there is a change to the regulatory regime applicable to the UCITS that results in a less restrictive regulatory regime compared to the current regime and that has a material impact on the management or operation of the UCITS in which the Funds are invested, the Funds will not acquire additional securities of such UCITS, and dispose of any securities of such UCITS in an orderly and prudent manner; and

(g) the Exemption Sought will terminate six months after the coming into force of any amendments that would permit a fund to invest in the UCITS subject to the provisions of such amendments.

"Frédéric Belleau"
Senior Director, Investment Products and Sustainable Finance
Autorité des marchés financiers

Application File #: 2025/0090
SEDAR+ File #: 06242006