What Canadian fund managers must stop charging investors this fall
Mutual fund managers in Canada will be barred from charging investors a fee to redeem fund units, under new OSC rules.
The change comes from an amendment to National Instrument 81-102 Investment Funds, published in the OSC Bulletin on August 20, 2026. It adds a new section, 10.2.1, titled "Prohibition of Fees for Redemptions," which bars a fund manager from charging a securityholder for redeeming units of a mutual fund.
There's one carve-out. Section 10.2.1 won't apply to a fee charged under a fee arrangement that existed before June 1, 2022, and is still in effect. So a fund manager with a redemption-fee arrangement already in place before that date can keep charging it even after the broader ban takes hold. Anything set up on or after June 1, 2022, won't qualify for that protection.
October 1, 2026 is the date to watch. That's when the redemption-fee ban takes effect across the jurisdictions where National Instrument 81-102 applies. Saskatchewan works a little differently: if the instrument is filed with that province's Registrar of Regulations after October 1, 2026, it comes into force there on whatever day it's actually filed.
Fund managers have a clear checklist ahead of the deadline. Go through the fund lineup, flag anything that still carries a redemption fee, and check whether the fee arrangement behind it predates June 1, 2022. Only those legacy arrangements are protected once section 10.2.1 kicks in - any redemption fee tied to something newer has to come off by October 1, or sooner if a manager wants to get ahead of it.
The rule reaches advisors too, just in a more specific way. Because the ban applies at the fund level rather than the account level, what it means for a given client depends on the fee arrangement attached to the particular fund or share class they hold. It's worth advisors checking which client holdings currently carry redemption fees, so they can flag which charges are going away and which might stick around under the transition exception.
Beyond that, the amendment doesn't do much else. Its text is limited to the new section 10.2.1, the June 1, 2022 transition cutoff, and the coming-into-force provisions setting October 1, 2026 as the effective date, with the separate rule for Saskatchewan. There's no new disclosure requirement attached, and no other part of National Instrument 81-102 is touched.
The full text of the Amendments to National Instrument 81-102 Investment Funds is available at https://www.osc.ca/en/securities-law/instruments-rules-policies/8/81-102-81-102cp/amendments-national-instrument-81-102-investment-funds-5.
