The Globe and Mail reports in its Thursday edition that the recent expiry of a U.S. patent that was held for decades by investment giant Vanguard is threatening to upend the growth of Canada's $650-billion exchange-traded-funds industry. The Globe's Clare O'Hara writes that more than 20 years ago, Vanguard received a patent that allowed the fund company to easily launch ETF versions of its existing mutual funds. Known as ETF share classes, the funds were able to provide investors greater tax efficiency and cost savings. The patent prohibited other U.S. mutual fund companies from creating their own ETFs based on their existing mutual funds. The ability to launch ETF versions of mutual funds gifted Vanguard a long advantage of easily launching both funds at the same time. But since the patent expired in 2023, around 80 U.S. mutual fund companies -- including Fidelity, Invesco and JPMorgan -- have applied to copy the dual class structure. And because of economy of scale, many of these U.S. ETFs will be able to charge much lower management fees than what is offered in Canada. Daniel Straus at National Bank points out the new ETFs will be actively managed -- likely making them more expensive than plain vanilla index funds.