In a recent development, the Canadian Securities Administrators (“CSA”) made an announcement on August 31, 2023, pertaining to their decision to repeal National Instrument 81-104 Alternative Mutual Funds (“NI 81-104”). Interestingly, this rule will continue to apply in all jurisdictions excluding Québec. The notable law firm, Stikeman Elliott LLP, has reported on this important regulatory development.
National Instrument 81-104, often referred to as “NI 81-104”, is a regulation specifically focused on alternative mutual funds. The aim behind the implementation of such a rule was to regulate and monitor the activities and operations of entities dealing with alternative mutual funds. This repeal will likely have a significant impact on how such financial instruments are regulated, and will directly influence the operations of firms which work with them.
Although the implications of this development are yet to be thoroughly analysed, one can infer that this shift might lead to modifications in the workings of entities currently operating under the governance of NI 81-104. Given that Québec has chosen to retain the use of National Instrument 81-104, it is expected that any significant impacts will be largely contained within that province.
Further details on the announcement and its potential implications can be accessed here.
This move by CSA clearly demonstrates their intent to evolve the regulations affecting financial entities accordingly with the changing economic environment. It serves as a reminder to all legal professionals, particularly those working in large corporations and law firms with financial dealings, to remain updated with regulatory changes in order to effectively adapt their practices.