2000 Ruling 2000-0008363 - Mutual Fund Large Investor Incentive -- summary under Subsection 104(7.1)

S. 104(7.1) ruling given regarding the discontinuance of the large investor rebate program (under which income of the Trust is first computed and allocated as if there were not reduction in the management fees borne by major investors, then a second round of allocations given major investors the benefit of such reductions) and its replacement by the addition of Class B units which a new class of units that will enable a negotiated management fee reduction payable directly by the Investor, so that the allocations and distributions on the Class B units will reflect such reductions. The CRA summary stated:

The purpose test in 104(7.1) is not met, namely the main purpose of the proposed transactions is to reduce the administrative complexity of the Reduced Management Fee program & to enable the manager to effectively market the units to differing groups of Investors.

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