We support regulatory measures designed to assist the capital-raising needs of Canadian issuers while strongly emphasizing investor protection. Investor protection in the exempt market is best enhanced by providing clear risk disclosures, taking some steps to verify eligibility to participate in the market, and implementing a best interest standard on all registrants.
Overview of the Council’s Comments:
At a minimum, we would suggest that all of the above-proposed conditions should be required in order for CEDIFs to be exempted from the investment fund manager registration requirements. We would recommend that the limit per beneficial investor be tied to that investor’s net worth or net assets and should be imposed on the purchase of any CEDIF in a calendar year.