The Globe and Mail reports in its Thursday edition that the recent expiry of a decades-long U.S. patent held by Vanguard Group may disrupt Canada's $650-billion ETF industry. The Globe's Clare O'Hara writes that this patent enabled Vanguard to launch ETF share classes of its mutual funds, offering investors enhanced tax efficiency and cost savings. The patent prevented U.S. mutual fund companies from creating ETFs based on their mutual funds, allowing Vanguard to launch both types of funds at a lower cost and with less effort, giving them a big advantage. Since the patent expired in 2023, about 80 U.S. mutual fund companies, including major players like Fidelity, Invesco and JPMorgan, have applied to adopt the dual class structure. This will allow many U.S. ETFs to charge significantly lower management fees than those in Canada due to economies of scale. Canadians cannot legally buy U.S. mutual funds, but the rise of ETFs on public exchanges poses a risk for Canadian fund companies. Canadian ETF Association director Eli Yufest says they fear investors may sell their Canadian holdings to purchase cheaper U.S. fund versions. In Canada, there are 45 providers who manage $650-billion in assets across about 1,400 funds.