Mackenzie Financial Corporation

December 22, 2021

Decision

Headnote

National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- approval of investment fund reorganization because the reorganization does not meet all the pre-approval criteria -- relief granted to permit top funds to invest in reorganized and continuing funds that hold securities of a fund established for tax deferral purposes post-reorganization -- subject to conditions.

Applicable Legislative Provisions

National Instrument 81-102 Investment Funds, ss. 2.1(1), 2.5(2)(b), 5.5(1)(b), 5.6(1) and 19.1(2).

December 22, 2021

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 MACKENZIE FINANCIAL CORPORATION (the Filer)

DECISION

Background

The principal regulator in the Jurisdiction has received an application from the Filer for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for:

(i) on behalf of the Reorganizing Funds (as defined below), approval under clause 5.5(1)(b) of National Instrument 81-102 Investment Funds (NI 81-102) for the proposed reorganizations (the Reorganizations) of certain series of the Reorganizing Funds as set out below (the Affected Series) with the applicable Canada Life Funds (as defined below)(the Approval Sought);

(ii) on behalf of the Filer's current and future mutual funds managed by the Filer or an affiliate of the Filer (the Top Funds), an exemption from the prohibition in paragraph 2.5(2)(b) of NI 81-102 to permit the Top Funds to purchase and hold a security of the Reorganizing Funds or the Canada Life Funds that hold more than 10% of its NAV in securities of its corresponding LP Funds and other investment funds in the aggregate (the Three-Tier Relief).

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 section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the provinces and territories of Canada, other than Ontario (together with Ontario, the Canadian Jurisdictions).

Interpretation

Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined. The following additional terms shall have the following meanings:

Canada Life Funds means Canada Life Global Growth Opportunities Fund, Canada Life U.S. Small-Mid Cap Growth Fund, Canada Life Emerging Markets Equity Fund, Canada Life European Equity Fund, and Canada Life Precious Metals Fund;

CLIML means Canada Life Investment Management Ltd., an affiliate of the Filer, subsidiary of The Canada Life Assurance Company and manager and trustee and manager of the Canada Life Funds;

LP Funds means Mackenzie CL Global Growth LP, Mackenzie CL US Small-Mid Cap Growth LP, Mackenzie CL Ivy European LP, and Mackenzie CL Precious Metals LP;

Meeting Materials means the notice of meeting and management information circular in respect of the Meeting dated January 11, 2022;

Reorganizing Funds means Mackenzie Global Growth Fund; Mackenzie US Small-Mid Cap Growth Fund, Mackenzie Emerging Markets Fund II, Mackenzie Ivy European Fund and Mackenzie Precious Metals Fund;

Tax Act means the Income Tax Act (Canada)

Representations

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

The Filer

1. The Filer is a corporation governed by the laws of Ontario and is registered as follows: as an investment fund manager in Ontario, Quebec and Newfoundland and Labrador; as a portfolio manager and exempt market dealer in the Canadian Jurisdictions; as an adviser in Manitoba; and as a commodity trading manager in Ontario.

2. The Filer, with its head office in Toronto, Ontario, is or will be the trustee and manager of the Reorganizing Funds, the LP Funds and the Top Funds that are not managed by its affiliates.

3. Neither the Filer, the Reorganizing Funds, the LP Funds nor the Top Funds are in default of securities legislation in any of the Canadian Jurisdictions.

CLIML

4. CLIML is a corporation governed under the laws of Canada.

5. CLIML is registered as a portfolio manager in each province and territory of Canada, as an investment fund manager in each of Ontario, Quebec and Newfoundland and Labrador, and as a commodity trading manager in Ontario.

6. CLIML will act as manager and trustee for the Canada Life Funds.

The Reorganizing Funds, Canada Life Funds and the LP Funds

7. The Reorganizing Funds are, and the Canada Life Funds are expected to be, a mutual fund established under the laws of Ontario. The Reorganizing Funds are, and the Canada Life Funds are expected to be, reporting issuers under the securities legislation of the Canadian Jurisdictions.

8. Units of the Affected Series of the Reorganizing Funds and Canada Life Funds generally are, or will be, qualified for sale under one or more simplified prospectuses, annual information forms and fund facts documents (collectively, the Offering Documents).

9. Series S units of the Reorganizing Funds and the corresponding Canada Life Funds will be offered only on an exempt distribution basis.

10. Each of the other series of units of each of the Canada Life Funds that correspond to the Affected Series will be newly created and will be qualified for distribution under a prospectus.

11. Each of the LP Funds will be a reporting issuer under the applicable securities legislation of the Province of Ontario.

12. Other than circumstances in which the securities regulatory authority of a province or territory of Canada has expressly exempted the Reorganizing Fund therefrom, each of the Reorganizing Funds follows the standard investment restrictions and practices established under NI 81-102.

13. The NAV for each series of the Funds and the LP Funds is, or will be, calculated on a daily basis in accordance with that fund's valuation policy and as described in the applicable Offering Documents.

The Top Funds

14. Each Top Fund is, or will be, a mutual fund established under the laws of Ontario. Each Top Fund is, or will be, a reporting issuer under the securities legislation of the Canadian Jurisdictions.

15. Each Top Fund distributes, or will distribute, some or all of its securities pursuant to a prospectus, annual information form and fund facts or ETF facts documents (as applicable).

16. Other than circumstances in which the securities regulatory authority of a province or territory of Canada has expressly exempted a Reorganizing Fund therefrom, each Top Fund follows, or will follow the standard investment restrictions and practices established under NI 81-102.

17. Each Top Fund is, or will be, subject to National Instrument 81-107 Independent Review Committee for Investment Funds (NI 81-107).

The Proposed Reorganizations and the Approval Sought

18. Pursuant to the Reorganizations, unitholders of each of the Reorganizing Funds would become unitholders of the Canada Life Fund, as follows:

<<Reorganizing Fund>>

<<Canada Life Fund>>

<<Affected Series>>

<<Nature of Reorganization>>

<<Expected Reorganization>> Date

Mackenzie Global Growth Fund

Canada Life Global Growth Opportunities Fund

Q, L, N, QF, H, QFW, HW, S, CL

Tax Deferred

January 28, 2022

Mackenzie US Small-Mid Cap Growth Fund

Canada Life U.S. Small-Mid Cap Growth Fund

Q, L, N, QF, H, QFW, HW, S, CL

Tax Deferred

January 28, 2022

Mackenzie Emerging Markets Fund II

Canada Life Emerging Markets Equity Fund

Q, L, N, QF, H QFW, HW, S

Tax Deferred

January 28, 2022

Mackenzie Precious Metals Fund

Canada Life Precious Metals Fund

Q, L, N, QF, H, QFW, HW, S

Tax Deferred

March 11, 2022

Mackenzie Ivy European Fund

Canada Life European Equity Fund

Q, L, N, QF, H, QFW, HW

Tax Deferred

March 11, 2022

19. In the opinion of the Filer, the Qualifying Dispositions (as defined below) satisfies all of the criteria for pre-approved reorganizations and transfers set forth in section 5.6 of NI 81-102 except that:

(i) The Qualifying Dispositions are not "qualifying exchanges" within the meaning of section 132.2 of the Tax Act or tax deferred transactions under subsection 85(1), 85.1(1), 86(1) or 87(1) of the Tax Act;

(ii) The Reorganizations do not contemplate the wind-up of the Reorganizing Funds as soon as reasonably possible following the Reorganizations; and

(iii) Unitholders of the Reorganizing Funds will not be provided with a fund facts document prior to the time they are asked to approve the Reorganizations for the reasons described below.

The Qualifying Dispositions

20. The proposed Reorganizations are in connection with a larger set of transactions that were announced on December 31, 2020. Although the Affected Series of the Reorganizing Funds are presently offered under the Filer's Mackenzie Canada Life Mutual Funds simplified prospectus and set out below, except those offered on an exempt distribution basis as described above, the Reorganizing Funds also offer series of units under the Filer's Mackenzie Investments simplified prospectus.

21. Causing the Affected Series unitholders to redeem their units (in cash or in kind) in which they are invested and using the redemption proceeds to subscribe for units of the corresponding Canada Life Funds (each, a Redemption Transaction) would in some instances trigger the realization of significant capital gains by the Affected Series unitholders.

22. The Filer intends to carry out "qualifying dispositions" with respect to the transfer of property from each Reorganizing Fund to a newly created Canada Life Fund under section107.4 of the Tax Act. That provision exempts transfers of property from one trust to another (each a Qualifying Disposition) from being a taxable event for the transferring trust (i.e., a Reorganizing Fund) and its unitholders (essentially allowing for a pro-rata partition of the Reorganizing Fund on a tax deferred basis).

23. Each Canada Life Fund will have the same investment objectives as the Reorganizing Fund and substantially the same investment objectives as the LP Fund.

24. Each Canada Life Fund and corresponding LP Fund will have substantially the same investment strategies and valuation procedures and, in the case of each Canada Life Fund, the same fee structure as its corresponding Reorganizing Fund. No fees or expenses will be charged at the LP Fund level other than expenses that otherwise would have been borne at the Reorganizing Fund level had the Reorganizations not occurred.

25. The chart immediately below paragraph 18 sets out the Affected Series of the Reorganizing Fund.

Details of the Proposed Reorganizations

26. On completion of the Reorganizations, the Filer will become sub-advisor of the Canada Life Funds in accordance with the terms of a sub-advisory agreement between the Filer and CLIML.

27. No sales charges will be payable in connection with the transfer to a Canada Life Fund or LP Fund of the investment portfolio by its applicable Reorganizing Fund.

28. Unitholders of each Affected Series of each Reorganizing Fund will continue to have the right to redeem their units or exchange such units for units of any other mutual fund offered under the applicable Offering Documents at any time up to close of business on the day of the Reorganizations.

29. In accordance with National Instrument 81-106 -- Investment Fund Continuous Disclosure (NI 81-106), press releases in respect to the proposed Reorganizations were issued and filed via SEDAR on November 13, 2021. A material change report and amendment to the Offering Documents with respect to the proposed Reorganizations were filed in accordance with NI 81-106.

30. By way of order dated October 21, 2016, the Filer was granted relief (the Notice-and-Access Relief) from the requirement set out in paragraph 12.2(2)(a) of NI 81-106 to send a printed management information circular to unitholders while proxies are being solicited, and, subject to certain conditions, instead allows a notice-and-access document (as described in the Notice-and-Access Relief) to be sent to such unitholders. Pursuant to the requirements of the Notice-and-Access Relief, the notice-and-access document and a form of proxy in connection with each special meeting of unitholders of the Affected Series of the Reorganizing Fund will be mailed to unitholders of the Affected Series of the Reorganizing Fund commencing on or about December 2, 2021 and will be concurrently filed on SEDAR. The Meeting Materials will also appear on the SEDAR website at www.sedar.com. If approved, unitholders of Affected Series of the Reorganizing Funds will receive fund facts document(s) for the corresponding Canada Life Fund in their first confirmation statement following the Reorganizations.

31. The Meeting Materials describe all relevant facts concerning the Reorganizations, including Qualifying Dispositions, the tax implications and other consequences of the Reorganizations, as well as the view of the Reorganizing Funds' Independent Review Committee (the IRC) that the Reorganizations achieve a fair and reasonable result for the Reorganizing Funds, so that unitholders of the Affected Series of the Reorganizing Funds may consider this information before voting on the Reorganization.

32. All of the series of the Canada Life Funds (other than Series S) and the single series of the LP Funds will be newly created and will be qualified for distribution under a prospectus.

33. In order to effect the Reorganizations, Series S units of the Canada Life Funds will be distributed to the Canada Life Unitholders currently in the corresponding Reorganizing Fund in reliance on the prospectus exemption contained in section 2.11 of National Instrument 45-106 -- Prospectus Exemptions.

34. A current simplified prospectus and fund facts documents are not available in respect of the Canada Life Funds as those funds are new. Instead of delivering these documents, the Filer has included information in respect of the Canada Life Funds and the LP Funds in the Meeting Materials. This will include the fact that the investment objective of each Canada Life Fund and each corresponding LP Fund, will be the same as that of the Reorganizing Fund. The management fees and administration fees of the Canada Life Fund will be the same as those of the Reorganizing Funds. It will also disclose that the investment strategies and valuation procedures of the Canada Life Funds and the LP Funds will be substantially the same as those of the Reorganizing Funds. The fact that the LP Funds will not charge management fees, administration fees or other expenses (other than expenses that otherwise would have been borne at the Reorganizing Fund level had the Reorganizations not occurred) will also be disclosed. The Filer believes that with this information, together with the information contained in the fund facts of the relevant series of the Reorganizing Fund that each unitholder of the Affected Series of the Reorganizing Fund received when their initial investment was made, unitholders in the Reorganizing Fund have access to prospectus-level disclosure with respect to the applicable Canada Life Fund.

35. If the necessary unitholder approval is obtained and the Filer decides to proceed with the Reorganizations, it will occur at or about the close of business on or about January 11, 2022, and March 11, 2022.

36. The Filer and CLIML will pay for the costs of the proposed Reorganizations. No management fees, administration fees or other expenses (other than expenses that would have been borne at the Reorganizing Fund level had the Reorganizations not occurred) will be charged at the LP Fund level. There are no charges payable by unitholders in the Reorganizing Funds who acquire units of the corresponding Canada Life Funds as a result of the Reorganizations.

37. The LP Funds will dispose of their assets as expeditiously as is consistent with prudent portfolio management and it is not anticipated that it will accept new money or assets by way of subscription after the completion of the Reorganizations. With the exception of the Reorganizing Funds and Canada Life Funds no other unitholders will be allowed to invest in the LP Funds.

38. As required by NI 81-107, the IRC has been appointed for the Reorganizing Funds. The Canada Life mutual funds established their own independent review committee and appointed their initial members on December 22, 2020. The IRC of the LP Funds will be comprised of the same members as the IRC of the Reorganizing Funds.

39. The Filer presented the potential conflict of interest matters related to the proposed Reorganizations to the IRC for a recommendation. On November 12,s 2021, the IRC reviewed the potential conflict of interest matters related to the proposed Reorganizations and provided its positive recommendation for each of the Reorganizations, after determining that each proposed Reorganization, if implemented, would achieve a fair and reasonable result for each applicable Reorganizing Fund.

Reasons for the Approval Sought

40. The purpose of the Qualifying Dispositions in respect of each of the Reorganizing Funds is to allow the Affected Series unitholders to be moved to the corresponding Canada Life Fund in the most cost and/or tax-efficient manner.

41. Proceeding by way of Redemption Transactions would cause the realization of significant capital gains by certain taxable investors in the Reorganizing Funds.

42. The Reorganizations are not expected to have any material impact on the unitholders in the Reorganizing Funds other than Affected Series unitholders. The Reorganizations will not negatively affect any unitholder's interest in the assets and liabilities of the relevant Reorganizing Fund and each Reorganizing Fund's investment objectives will be the same as its corresponding Canada Life Fund and substantially the same as its corresponding LP Fund. The Qualifying Dispositions are being structured to be a non-taxable event to the Affected Series unitholders and the remaining unitholders of the Reorganizing Funds.

43. Affected Series unitholders will continue to have the right to redeem units of each Reorganizing Fund for cash at any time up to the close of business on the last business day before the Reorganizations. Units so redeemed will be redeemed at a price equal to their NAV per unit on the redemption date.

Required Relief for the LP Funds

44. One of the requirements to effecting the Reorganizations as Qualifying Dispositions is that each asset (or group of identical assets) of each Reorganizing Fund must be capable of being divided into a precise percentage allocable to each unitholder or class of unitholders (the Transfer Percentage). In recognition of the fact that it may not always be practicable to effect such a division, the Tax Act contains a "safe harbour" exception to this requirement. The "safe harbour" provides that the Canada Life Funds may receive as part of the Qualifying Dispositions, in lieu of a fractional interest in a share that would otherwise be required, a disproportionate amount of money or interest in the share, provided that its value does not exceed the lesser of $200 and the fair market value of the fractional interest. This "safe harbour" only applies in respect of equity securities (and specifically equity securities that do not exceed the specified value threshold) and does not adequately address the difficulties that the precise Transfer Percentage requirement poses more generally.

45. In addition, certain assets (or group of identical assets) may not be readily divisible for other reasons. In order to meet this condition, certain assets (or groups of identical assets) will be transferred on a tax deferred basis by the Reorganizing Funds to the LP Funds in exchange for units of the LP Funds. The units of the LP Funds will then become an asset (or group of identical assets) of the corresponding Reorganizing Funds and a portion of those units will be transferred to the corresponding Canada Life Fund based on the Transfer Percentage.

46. In summary, where it would otherwise be difficult or impossible to effect a transfer in the required precise Transfer Percentage of certain assets of the Reorganizing Funds, those assets will be transferred to the LP Funds, whose units are readily capable of being transferred in the required Transfer Percentage.

The Three-Tier Relief

47. As the LP Funds are being qualified by prospectus, a Reorganizing Fund or a Canada Life Fund may invest up to 100% of their NAV in the LP Fund under section 2.5 of NI 81-102.

48. However, if any of the Reorganizing Funds or Canada Life Funds invests more than 10% of their NAV in other investment funds and the LP Funds in aggregate, it would preclude other investment funds managed by the Filer or its affiliates from investing in that Reorganizing Fund or Canada Life Fund under paragraph 2.5(2)(b) of NI 81-102.

49. Prior to the Reorganizations, the Top Funds would have been permitted to invest in the Reorganizing Funds and Canada Life Funds in accordance with section 2.5 of NI 81-102.

50. The Reorganizations may result in certain of the Reorganizing Funds and/or the Canada Life Funds holding more than 10% of its NAV in other investment funds due to these funds holding securities of the corresponding LP Fund(s).

51. The Three-Tier Relief is required for the Top Funds to continue investing in one or more of the Reorganizing Funds or the Canada Life Funds that invest more than 10% of its NAV in other investment funds, which includes holdings of its corresponding LP Funds that were received as a result of the Reorganizations, in order for the Top Funds to further their investment objectives and investment strategies (the Three-Tier Structure).

52. Except for paragraph 2.5(2)(b) of NI 81-102, a Fund's use of the Three-Tier Relief will be made in accordance with the provisions of section 2.5 of NI 81-102.

53. Each Reorganizing Fund and Canada Life Fund that is part of a Three-Tier Structure will not invest more than 10% of its NAV in other investment funds, excluding investments in (i) one or more money market funds, (ii) one or more index participation units as defined in NI 81-102 (IPUs) and (iii) corresponding LP Fund(s).

54. The LP Funds are being introduced into the structure to further the best interests of unitholders in the Reorganizing Funds.

55. The LP Funds will dispose of their assets as expeditiously as is consistent with prudent portfolio management and it is not anticipated that they will accept new money or assets by way of subscription after the completion of the Reorganizations.

56. There will be no duplication of fees between each tier of the Three-Tier Structure. The prospectus of each Top Fund, Reorganizing Fund and Canada Life Fund will disclose that fees and expenses will not be duplicated as a result of investments in underlying funds.

57. To ensure investors continue to have transparency into the portfolio securities attributable to the Reorganizing Fund and/or Canada Life Fund mandates, the Filer and CLIML intend to disclose the individual LP Fund positions within the quarterly portfolio disclosures, MRFP holdings disclosure and manager website holdings disclosure at the Reorganizing Fund level.

58. Each Top Fund will comply with the requirement under NI 81-106 relating to the top 25 positions portfolio holdings disclosure in its management report of fund performance and the requirements of Form 81-101F3 Contents of Fund Facts Document relating to top 10 position portfolio holdings disclosure in its fund facts documents as if the Top Fund were investing directly in the LP Fund held by the corresponding Reorganizing Fund or Canada Life Fund.

<<Reorganizing Fund>>	<<Canada Life Fund>>	<<Affected Series>>	<<Nature of Reorganization>>	<<Expected Reorganization>> Date

Mackenzie Global Growth Fund	Canada Life Global Growth Opportunities Fund	Q, L, N, QF, H, QFW, HW, S, CL	Tax Deferred	January 28, 2022

Mackenzie US Small-Mid Cap Growth Fund	Canada Life U.S. Small-Mid Cap Growth Fund	Q, L, N, QF, H, QFW, HW, S, CL	Tax Deferred	January 28, 2022

Mackenzie Emerging Markets Fund II	Canada Life Emerging Markets Equity Fund	Q, L, N, QF, H QFW, HW, S	Tax Deferred	January 28, 2022

Mackenzie Precious Metals Fund	Canada Life Precious Metals Fund	Q, L, N, QF, H, QFW, HW, S	Tax Deferred	March 11, 2022

Mackenzie Ivy European Fund	Canada Life European Equity Fund	Q, L, N, QF, H, QFW, HW	Tax Deferred	March 11, 2022

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. The decision of the principal regulator under the Legislation is that:

1. the Approval Sought is granted, provided that the Filer obtains the prior approval of the applicable unitholders of the Reorganizing Funds for the Reorganizations at a special meeting held for that purpose;

2. the Three-Tier Relief is granted, provided that:

a. an investment by a Top Fund in securities of the Reorganizing Fund or the Canada Life Fund is in accordance with the investment objectives of the Top Fund;

b. each Reorganizing Fund and Canada Life Fund which are part of a Three-Tier Structure do not invest more than 10% of NAV in other investment funds, excluding investments in (i) one or more money market funds; (ii) one or more IPUs; and (ii) in its corresponding LP Fund(s);

c. each Reorganizing Fund and Canada Life Fund will not make additional investments in its LP Fund(s) after the Reorganization is completed;

d. the investment of each Top Fund in securities of a Reorganizing Fund or Canada Life Fund is otherwise made in compliance with all other requirements of section 2.5 of NI 81-102, except to the extent that discretionary relief has been granted from any such requirement;

e. each Top Fund complies with the requirements under NI 81-106 relating to top 25 positions portfolio holdings disclosure in its management reports of fund performance and the requirements of Form 81-101F3 Contents of Fund Facts Document relating to top 10 position portfolio holdings disclosure in its fund facts documents as if the Reorganizing Fund or Canada Life Fund was investing directly in the LP Funds; and

f. the prospectus of each Top Fund discloses, or will disclose in the next renewal of its prospectus following the date of this decision, the fact that the Top Fund has obtained the Exemption Sought.

"Darren McKall"

Manager

Investment Funds and Structured Products Ontario Securities Commission

Application File #: 2021/0656

Sedar No. 3297822