5.4. Best Practices for Selling Funds

• All sales charges that may be associated with purchasing, retaining, or redeeming the shares must be disclosed to customers.

• Solicitors cannot call a fund “no load” or say it has “no sales charge” if there is a front-end sales charge, a contingent deferred sales charge, or a marketing or service fee that exceeds 0.25% of the average assets of the fund per year (or for a closed-end fund, any underwriting fees or other offering expenses).

• All discounts due to breakpoints need to be disclosed.

• The recommendation of a particular class of investment company shares (A, B, or C shares) must be suitable for the investor.

• Solicitors should not recommend the purchase of multiple investment company funds that have the same investment objective, because the customer will end up paying higher fees for no more diversification.

• Solicitors should not recommend the sale of a customer’s current mutual fund for a new mutual fund with a similar investment objective, unless it is genuinely suitable for the customer (otherwise the customer will incur unnecessary fees).

• Solicitors sho