Securities regulators have given permission to change the manager of the Ethical Mutual Funds to a new joint venture limited partnership, without getting approval from unitholders.

Ethical Funds Inc. (EFI), the manager of the Ethical Mutual Funds, sought an exemption from the requirement for approval by unitholders involving the change of manager of the funds from EFI to a limited partnership 50% owned by the Credit Union Centrals and 50% owned by the Fédération des caisses Desjardins du Québec.

The decision, which was made by the British Columbia Securities Commission, was reported in the OSC Bulletin. The decision notes that the Credit Union Centrals and Desjardins want the Ethical Mutual Funds and the Northwest Mutual Funds , which are owned by Desjardins, to gain access to each other’s distribution channel.

“The Credit Union Centrals and Desjardins would also like both families of funds to have the same manager, and to allow the securityholders of such funds to be able to switch between funds in both fund families on a cost free basis,” it explains.

“To accomplish this objective in a tax efficient manner, the Credit Union Centrals and Desjardins will establish a limited partnership, the JVLP, which will replace EFI and NMFI as the manager of the Ethical Mutual Funds and the Northwest Mutual Funds, respectively,” it adds.

The decision says that it is not expected that there will be any impact from the transaction on the funds’ unitholders because both fund families will generally be managed in the same manner as they are managed today. “The Ethical Mutual Funds and the Northwest Mutual Funds will each continue to be managed and operated as a separate distinct family of mutual funds and there is currently no intention to merge the two families of mutual funds,” it notes.

The management of the LP and its general partner will generally be comprised of the same individuals who are the management of the existing firms; and the investment advice to the funds will generally be given by the same individuals who are providing it today and there is currently no intention to change the sub-advisors.