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S.I. No. 352/2011 - European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations 2011.

S.I. No. 352/2011 - European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations 2011. Skip to content Disclaimer Feedback Helpdesk Gaeilge Léim go dtí an t-ábhar Séanadh Aiseolas Deasc chabhrach English Gaeilge English Produced by the Office of the Attorney General Táirgthe ag Oifig an Ard-Aighne Home Legislation Acts of the Oireachtas Statutory Instruments Pre-1922 Legislation Constitution External Resources Bills (Houses of the Oireachtas) Iris Oifigiúil / Official Gazette Revised Acts (LRC) Classified List of Legislation (LRC) Translations (acts.

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  3. s)or rangeBliain nó blianta nó raon TypeCineál All Legislation Acts Statutory Instruments Advanced SearchCuardach Casta HomeBaile Statutory InstrumentsIonstraimí Reachtúla 2011 S.I. No. 352/2011 - European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations 2011. S.I. No. 352/2011 - European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations 2011. AmendmentsLeasuithe Download PDF Íoslódáil PDF TA B LE OF CONTENTS PART 1 Preliminary 1. Citation 2. Commencement 3. Interpretation — general PART 2 Scope 4. Scope 5. Restriction of Unit Trusts Act 1990 6. UCITS established in the State PART 3 Authorisation of UCITS 7. Prohibition on UCITS carrying on activities in the State without authorisation 8. Requirements for authorising unit trust, common contractual fund or investment company 9. Application of management company not established in the State 10. Circumstances in which Bank shall not authorise UCITS 11. Time limit within which Bank shall inform management or investment company whether or not it is authorised 12. Approval of Bank necessary for subsequent changes 13. Applications for authorisation 14. Bank shall make law, etc. on UCITS accessible PART 4 Obligations regarding Management Companies Chapter 1 Conditions for taking up business 15. Authorisation of management company 16. Activities of management company 17. Conditions for authorisation of management companies and grounds for withdrawal of authorisation 18. Application for authorisation Chapter 2 Relations with third countries 19. Relations with third countries Chapter 3 Operating conditions 20. Duty of Bank to ensure that management companies comply with Regulations 16 and 17 21. Qualifying holdings 22. Prudential rules 23. Delegations 24. Rules of conduct 25. Investor complaints Chapter 5 Freedom of establishment and freedom to provide services 26. Establishment of branch and provision of services 27. Establishment of branch in another Member State 28. Provision of information 29. Compliance with rules which relate to constitution and functioning of UCITS, etc. 30. Provision of documentation to competent authority 31. Provision of documentation to Bank 32. Provisions applicable to management company authorised in another Member State PART 5 Obligations Regarding trustee 33. Safe-keeping of assets 34. Obligations of trustee 35. Trustee 36. Liability of trustee 37. Prohibition against single company acting as both management company and trustee 38. Trust deed, etc. to lay down conditions for replacement of management company, etc. PART 6 Obligations Regarding Investment Companies Chapter 1 Conditions for taking up business 39. Investment companies with fixed capital 40. Investment companies with variable capital 41. Provisions supplementary to Regulations 39 and 40 42. Authorisation of investment company Chapter 2 Operating conditions 43. Application of Regulations 23 and 24 44. Prudential rules for investment companies 45. Application of segregated liability to investment companies established as UCITS Chapter 3 Obligations regarding trustee 46. Safe-keeping of assets 47. Obligations of trustee 48. Exemption from requirement to have trustee 49. Further exemption 50. Requirement on Bank to inform EC Commission regarding exemptions 51. Application of Regulation 35

(1)to
(3)and
(7)
  1. Liability of trustee
  2. Company shall not act as both investment company and trustee
  3. Articles to lay down conditions for replacement of trustee PART 7 Mergers of UCITS
  4. Interpretation — Part 7
  5. Permitted mergers
  6. Authorisation by Bank of merger
  7. Terms of merger
  8. Verification
  9. Validation of certain matters
  10. Information on merger
  11. Maximum percentage of votes cast to approve merger
  12. Purchase or redemption of units
  13. Legal, advisory and administrative costs of merger
  14. Law applicable to merger
  15. Consequences of different kinds of merger PART 8 Obligations concerning Investment Policies of UCITS
  16. Sub-funds of UCITS to be regarded as separate UCITS
  17. Permitted investments
  18. Risk-management
  19. Investments in one issuer’s securities
  20. Index funds
  21. Securities issued or guaranteed by States, etc
  22. Investments in UCITS and other collective investment undertakings
  23. Acquisitions of shares carrying voting rights
  24. Subscription rights
  25. Derogation for recently authorised UCITS
  26. Breaches of limits PART 9 Master — Feeder Structures Chapter 1 Scope and approval
  27. Meaning of feeder UCITS and master UCITS, etc
  28. Approval by Bank of investment of feeder UCITS
  29. Common provisions for feeder UCITS and master UCITS
  30. Provisions applicable where master UCITS and feeder UCITS have different trustees
  31. Provisions applicable where master UCITS and feeder UCITS have different auditors
  32. Additional information to be contained in prospectus of feeder UCITS
  33. Information to be provided to unit-holders by certain feeder UCITS
  34. Feeder UCITS to monitor master UCITS, etc.
  35. Information to be supplied to Bank by master UCITS authorised by Bank, etc.
  36. Information to be given by Bank in relation to non-compliance, etc. PART 10 Obligations concerning Information to be provided to Investors Chapter 1 Publication of prospectus and periodical reports
  37. Information to be published by investment or management company
  38. Information to be included in prospectus and periodic reports
  39. Provisions supplementary to Regulation 89
  40. Annexation of trust deed, etc. to prospectus, etc.
  41. Prospectus to be kept up to date
  42. Auditing of accounting information
  43. Prospectus, etc. to be sent to Bank, etc.
  44. Provision of prospectus, etc. to investors Chapter 2 Publication of other information
  45. Publication of price of units
  46. Marketing communications to investors Chapter 3 Key investor information
  47. Drawing up of key information for investors
  48. Pre-contractual information, etc
  49. Timing of provision of key investor information
  50. Medium of provision of key investor information
  51. UCITS to send key investor information to Bank, etc. PART 11 General Obligations of UCITS
  52. Borrowing of money by UCITS
  53. Redemption, etc. at request of unit-holder
  54. Creation and cancellation of units of unit trust or common contractual fund
  55. Issue of registered or bearer certificates
  56. Winding up of investment company
  57. Value of assets
  58. Application of income
  59. Issue and redemption or repurchase of units
  60. Loans or guarantees
  61. Uncovered sales of transferable securities, etc.
  62. Umbrella funds
  63. Remuneration and expenditure PART 12 Special Provisions Applicable to UCITS which Market their Units in Member States other than those in which they are established
  64. UCITS authorised in another Member State may market units in the State without imposition of additional requirements, etc.
  65. Provision of facilities in relation to unit-holders
  66. Notification requirements
  67. Information for investors in host Member State
  68. Legal form of designation of UCITS
  69. Power of Bank to prohibit marketing PART 13 Provisions Concerning Authorities Responsible for Authorisation and Supervision
  70. Establishment of Bank as competent authority
  71. Liability of Bank and the State
  72. Powers of Bank
  73. Register of authorised UCITS
  74. Keeping of books and records
  75. Furnishing of information to Bank
  76. Application by Bank to High Court
  77. Replacement of management company or trustee
  78. Revocation of authorisation
  79. Notice of intention to revoke
  80. Directions by Bank
  81. Penalties
  82. Collaboration with competent authorities in other Member States
  83. Reports by auditor of UCITS
  84. Bank to give reasons for decisions, etc.
  85. Exchange of information with other competent authorities
  86. Investigation by competent authority in another Member State of management company authorised by Bank PART 14 Derogations, Transitional and Final Provisions
  87. Transitional provisions applicable to existing investment firms and management companies
  88. Revocations, etc. SCHEDULE 1 Functions included in activity of Collective Portfolio Management SCHEDULE 2 Transferable Securities PART 1 Criteria Applicable to Transferable Securities which fall within paragraph (a), (b) or (c) of definition in regulation 3
(1)of “transferable securities” PART 2 Securities specified for purposes of paragraph (d) of definition in regulation 3
(1)of “Transferable Securities” SCHEDULE 3 Interpretation of references in these regulations to money market instruments SCHEDULE 4 Prudential requirements applicable to Management Companies SCHEDULE 5 Conduct requirements applicable to Management Companies SCHEDULE 6 Particulars of Standard Agreement Between Trustee and Management Company SCHEDULE 7 Detailed content, format and method by which to provide information referred to in regulation 61 SCHEDULE 8 Provision of Key Investor Information SCHEDULE 9 Requirements Applicable to Risk Management SCHEDULE 10 Requirements applicable to Master-Feeder Structures PART 1 Content of Information Sharing Agreement between master ucits and feeder ucits PART 2 Liquidation, Merger or Division of Master UCITS PART 3 Content of Information Sharing Agreement where Master UCITS and Feeder UCITS have different Trustees PART 4 Content of Information Sharing Agreement where Master UCITS and Feeder UCITS have different auditors SCHEDULE 11 Information to be contained in prospectus SCHEDULE 12 Information to be contained in periodic reports SCHEDULE 13 Information to be made accessible by Bank SCHEDULE 14 Notification Requirements SCHEDULE 15 Requirements Applicable to Simplified Prospectus SCHEDULE 16 Table of Cross-References To Specific UCITS Regulations in Legislation PART 1 Unit Trusts Act 1990 (No. 37 of 1990) PART 2 Companies Act 1990 (No. 33 of 1990) PART 3 Investment Funds, Companies and Miscellaneous Provisions Act 2005 (NO. 12 OF 2005) SI. No. 352 of 2011 EUROPEAN COMMUNITIES (UNDERTAKINGS FOR COLLECTIVE INVESTMENT IN TRANSFERABLE SECURITIES) REGULATIONS 2011 Notice of the making of this Statutory Instrument was published in “Iris Oifigiúil” of 8th July, 2011. I, MICHAEL NOONAN, Minister for Finance, in exercise of the powers conferred on me by section 3 (as amended by section 2 of the European Communities Act 2007 (No. 18 of 2007)) of the European Communities Act 1972 (No. 27 of 1972), and for the purpose of giving effect to Directive 2009/65/EC of the European Parliament and of the Council of 13 July 20091 , Commission Directive 2010/43/EU of 1 July 20102 and Commission Directive 2010/44/EU of 1 July 20103 , hereby make the following Regulations: PART 1 Preliminary Citation 1. These Regulations may be cited as the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations 2011. Commencement 2. These Regulations come into operation on 1 July 2011. Interpretation — general 3.
(1)In these Regulations— “articles”, in relation to a company, has the meaning assigned to it by the Companies Act 1963 (No. 33 of 1963); “Bank” means the Central Bank of Ireland; “branch”, in relation to a management company, means, subject to paragraph
(2), a part of the company which has no legal personality and which provides services for which the company has been authorised; “client” means a natural or legal person, or any other undertaking (including a UCITS), to whom a management company provides a service of collective portfolio management or services pursuant to Regulation 16
(2)(a); “close links” means a situation in which 2 or more natural or legal persons are linked by— (
  1. a)participation, being the ownership, direct or by way of control, of 20% or more of the voting rights or capital of an undertaking, or (
  2. b)subject to paragraph
(3), control, being the relationship between a parent undertaking and a subsidiary, as defined in Articles 1 and 2 of the Seventh Council Directive 83/349/EEC of 13 June 19834 based on Article 54
(3)(g) of the Treaty on consolidated accounts and in all the cases referred to in Article 1
(1)and
(2)of Directive 83/349/EEC, or a similar relationship between any natural or legal person and an undertaking; “collective portfolio management” means the management of UCITS and other collective investment undertakings, and includes the functions specified in Schedule 1; “common contractual fund” means a collective investment undertaking, being an unincorporated body established by a management company under which the participants by contractual arrangement participate and share in the property of the undertaking as co-owners; “Community act” means an act adopted by an institution of the European Communities; “competent authority” means the Bank or, in the case of another Member State, the body or bodies designated by that State to act as a competent authority for the purposes of the Directive; “counterparty risk”, in relation to a UCITS, means the risk of loss for the UCITS resulting from the fact that the counterparty to a transaction entered into by the UCITS may default on its obligations prior to the final settlement of the transaction’s cash flow; “court” means the High Court; “credit institution” means a credit institution within the meaning of Directive 2006/48/EC of the European Parliament and of the Council of 14 June 20065 relating to the taking up and pursuit of the business of credit institutions (recast); “cross-border merger” means a merger of UCITS— (
  1. a)at least 2 of which are established in different Member States, or (
  2. b)established in the same Member State into a newly constituted UCITS established in another Member State; “debt securities” has the meaning assigned to it by paragraph (
  3. b)of the definition in this Regulation of “transferable securities”; “Directive” means Directive 2009/65/EC of the European Parliament and of the Council of 13 July 2009 on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (UCITS) (recast), including the associated implementing measures contained in Directive 2010/43 and Directive 2010/44/EU; “Directive 2010/43/EU” means Commission Directive 2010/43/EU of 1 July 2010 implementing Directive 2009/65/EC of the European Parliament and of the Council as regards organisational requirements, conflicts of interest, conduct of business, risk management and content of the agreement between a depositary and a management company; “Directive 2010/44/EU” means Commission Directive 2010/44/EU of 1 July 2010 implementing Directive 2009/65/EC of the European Parliament and of the Council as regards certain provisions concerning fund mergers, master-feeder structures and notification procedure; “directors”, in relation to a management company, investment company or trustee, means those persons who— (
  4. a)under the Companies Acts or the trust deed or the deed of constitution or the memorandum and articles of association, represent the management company, the investment company or the trustee, as the case may be, or (
  5. b)who effectively determine the policy of the management company, the investment company or the trustee, as the case may be, and includes shadow directors within the meaning of the Companies Act 1990 (No. 33 of 1990); “domestic merger” means a merger between UCITS established in the same Member State where at least one of the involved UCITS has been notified pursuant to Regulation 117; “durable medium” means an instrument which enables an investor to store information addressed personally to the investor in a way that is accessible for future reference for a period of time adequate for the purposes of the information and which allows the unchanged reproduction of the information stored; “enactment” means a statute or an instrument made under a power conferred by a statute; “individual portfolio management services” means the services referred to in subparagraph (
  6. a)of paragraph
(2)of Regulation 16, and includes the discretionary portfolio management services referred to in clause (
  1. i)of that subparagraph and the non-core services referred to in clause (
  2. ii)of that subparagraph; “initial capital” means the funds as referred to in Article 57(
  3. a)and (
  4. b)of Directive 2006/48/EC; “investment company” means— (
  5. a)an investment company with fixed capital, or (
  6. b)an investment company with variable capital; “investment company with fixed capital” means a company so referred to in Regulation 4
(6)(b); “investment company with variable capital” means a company so referred to in Regulation 4
(6)(c); “issue” means the issue of units of a UCITS; “KII Regulation” means Commission Regulation (EU) No. 583/2010 of 1 July 20106 implementing Directive 2009/65/EC of the European Parliament and of the Council as regards key investor information and conditions to be met when providing key investor information or the prospectus in a durable medium other than paper or by means of a website; “liquidity risk”, in relation to a UCITS, means the risk that a position in the UCITS portfolio cannot be sold, liquidated or closed at limited cost in an adequately short time frame and that the ability of the UCITS to comply at any time with Regulation 104
(1)is thereby compromised; “management company” means a company the regular business of which is the management of UCITS in the form of unit trusts, common contractual funds or investment companies (or any combination thereof), and includes the functions specified in Schedule 1; “management company’s home Member State” means the Member State in which the management company has its registered office; “management company’s host Member State” means a Member State, other than the management company’s home Member State, within the territory of which the management company has a branch or provides services; “market risk”, in relation to a UCITS, means the risk of loss for the UCITS resulting from fluctuation in the market value of positions in the UCITS portfolio attributable to changes in market variables, such as interest rates, foreign exchange rates, equity and commodity prices or an issuer’s creditworthiness; “Member State” means a Member State of the European Union; “merger” means an operation whereby— (
  1. a)one or more UCITS or sub-funds thereof (“merging UCITS”), on being dissolved without going into liquidation, transfer all of their assets and liabilities to another existing UCITS or a sub-fund thereof (“receiving UCITS”), in exchange for the issue to their unit-holders of units of the receiving UCITS and, if applicable, a cash payment not exceeding 10% of the net asset value of those units, (
  2. b)2 or more UCITS or sub-funds thereof (“merging UCITS”), on being dissolved without going into liquidation, transfer all of their assets and liabilities to a UCITS which they form or a sub-fund thereof (“receiving UCITS”), in exchange for the issue to their unit-holders of units of the receiving UCITS and, if applicable, a cash payment not exceeding 10% of the net asset value of those units, or (
  3. c)one or more UCITS or sub-funds thereof (“merging UCITS”), which continue to exist until the liabilities have been discharged, transfer their net assets to another sub-fund of the same UCITS, to a UCITS which they form or to another existing UCITS or a sub-fund thereof (“receiving UCITS”); “merging UCITS”, in relation to a merger, means a merging UCITS as specified in paragraph (a), (
  4. b)or (
  5. c)of the definition in this Regulation of “merger”; “MIFID” means Directive 2004/39/EC of the European Parliament and of the Council of 21 April 20047 on markets in financial instruments amending Council Directives 85/611/EC and 93/6/EEC and Directive 2000/12/EC of the European Parliament and of the Council and repealing Council Directive 93/22/EC; “MIFID Regulations” means the European Communities (Markets in Financial Instruments) Regulations 2007 ( S.I. No. 60 of 2007 ); “money market instruments” means instruments normally dealt in on the money market which are liquid and have a value which can be accurately determined at any time, as construed in accordance with paragraph
(4)as read with Schedule 3; “operational risk”, in relation to a UCITS, means the risk of loss for the UCITS resulting from inadequate internal processes and failures in relation to people and systems of the management company concerned or from external events, and includes legal and documentation risk and risk resulting from the trading, settlement and valuation procedures operated on behalf of the UCITS; “OTC derivative” means a financial derivative instrument dealt in over-the-counter; “own funds” means, subject to paragraph
(5), own funds as referred to in Title V, Chapter 2, Section 1 of Directive 2006/48/EC; “parent undertaking” means a parent undertaking as defined in Articles 1 and 2 of the Seventh Council Directive 83/349/EEC; “proposed management company” means a person who is seeking authorisation from the Bank to be an authorised management company; “qualifying holding”, in relation to a proposed management company or authorised management company, means, subject to paragraph
(6)— (
  1. a)a direct or indirect holding of shares or other interest in the company which represents 10% or more of the capital of, or the voting rights in, the company, or (
  2. b)a direct or indirect holding of shares or other interest in the company which is less than 10% of the capital of, or the voting rights in, the company which, in the opinion of the Bank, makes it possible to exercise a significant influence over the management of the company in which the holding subsists; “qualifying shareholder” means a person who has or controls a qualifying holding; “rebalancing of the portfolio”, in relation to a UCITS, means a significant modification of the composition of the portfolio of the UCITS; “receiving UCITS”, in relation to a merger, means a receiving UCITS as specified in paragraph (a), (
  3. b)or (
  4. c)of the definition in this Regulation of “merger”; “redemption” means the purchase of units from a holder by a management company or investment company; “relevant person”, in relation to a management company, means— (
  5. a)a director, partner or equivalent, or manager, of the company, (
  6. b)an employee of the company and any other natural person whose services are placed at the disposal and under the control of the company and who is involved in the provision by the company of collective portfolio management, or (
  7. c)a natural person who is directly involved in the provision of services to the company under a delegation arrangement to third parties for the purpose of the provision by the company of collective portfolio management; “repurchase” means the purchase of units from a holder by a management company or investment company; “senior management”, in relation to a management company, means the person or persons who effectively conduct the business of the company in accordance with Regulation 17
(1)(c); “shares” has the meaning assigned to it by paragraph (
  1. a)of the definition in this Regulation of “transferable securities”; “sub-fund” means a separate portfolio of assets maintained by a UCITS in accordance with its trust deed, deed of constitution or articles; “subsidiary” means a subsidiary undertaking within the meaning of Regulation 4 of the European Communities (Companies Group Accounts) Regulations 1992 ( S.I. No. 201 of 1992 ); “supervisory function”, in relation to a management company, means the relevant persons or body or bodies responsible for the supervision of the company’s senior management and for the assessment and periodical review of the adequacy and effectiveness of the risk management process and of the policies, arrangements and procedures put in place to comply with the company’s obligations under these Regulations; “synthetic risk and reward indicators” means synthetic indicators within the meaning of Article 8 of the KII Regulation; “third country” means a country that is not a Member State, and includes a state, province, region or dependent territory of such a country; “transferable securities” means— (
  2. a)shares in companies and other securities equivalent to shares in companies (in these Regulations referred to as “shares”) and which fulfil the criteria specified in Part 1 of Schedule 2 applicable to them, (
  3. b)bonds and other forms of securitised debt (in these Regulations referred to as “debt securities”) and which fulfil the criteria specified in Part 1 of Schedule 2 applicable to them, (
  4. c)other negotiable securities which carry the right to acquire any securities which fall within paragraph (
  5. a)or (
  6. b)by subscription or exchange and which fulfil the criteria specified in Part 1 of Schedule 2 applicable to them, or (
  7. d)securities specified for the purposes of this paragraph in Part 2 of Schedule 2, other than the techniques and instruments referred to in Regulation 69
(2)(a); “trustee”, in relation to a UCITS, means an institution referred to as a depositary in the Directive; “UCITS home Member State” means the Member State in which the UCITS is authorised; “UCITS host Member State” means a Member State, other than the UCITS home Member State, in which the units of the UCITS are marketed; “umbrella fund” means, subject to paragraph
(7), a UCITS which is divided into 2 or more sub-funds; “undertaking for collective investment in transferable securities” or “UCITS” has the meaning assigned to it by Regulation 4
(3); “unit” includes a share and any other instrument granting an entitlement to share in the investments or relevant income of a collective investment undertaking, and whether or not the undertaking is a UCITS to which these Regulations apply; “unit-holder” means a natural or legal person holding one or more units in a UCITS; “unit trust” means a collective investment undertaking constituted as a trust under which the property concerned is held on trust for the participants; “usual time limits” means those time limits which are acceptable market practice in the context of a particular transaction.
(2)For the purposes of these Regulations, all the places of business set up in the same Member State by a management company with its headquarters in another Member State shall be regarded as a single branch of the company.
(3)For the purposes of paragraph (b) of the definition in paragraph
(1)of “close links”— (
  1. a)a subsidiary undertaking of a subsidiary undertaking shall also be considered to be a subsidiary of the parent undertaking which is at the head of those undertakings, and (
  2. b)situations in which 2 or more natural or legal persons are permanently linked to the same person by a control relationship shall also be regarded as constituting a close links between such persons.
(4)Schedule 3 shall apply to the interpretation of references in these Regulations to money market instruments.
(5)Articles 13 to 16 of Directive 2006/49/EC of 14 June 20068 on the capital adequacy of investment firms and credit institutions (recast) shall, with all necessary modifications, apply to the definition in paragraph
(1)of “own funds”.
(6)(a) For the purposes of the definition in paragraph
(1)of “qualifying holding”, the voting rights referred to in Article 7 of Directive 88/627/EEC of 12 December 19889 on the information to be published when a major holding in a listed company is acquired or disposed of shall be taken into account. (b) For the purposes of subparagraph (a), the voting rights referred to in Articles 9 and 10 of Directive 2004/109/EC of the European Parliament and of the Council of 15 December 200410 on the harmonisation of transparency requirements in relation to information about issuers whose securities are admitted to trading on a regulated market and amending Directive 2001/34/EC shall be taken into account.
(7)Part 8 shall apply to each sub-fund of an umbrella fund as if the sub-fund were a separate UCITS.
(8)Unless the contrary intention appears— (
  1. a)a word or expression used in these Regulations and also in the Directive has in these Regulations the same meaning as it has in the Directive, and (
  2. b)a reference to any other enactment, EC Directive or Regulation shall be construed as a reference to the enactment, EC Directive or Regulation, as the case may be, as amended by any other enactment, EC Directive or Regulation. PART 2 Scope Scope 4.
(1)Subject to paragraph
(9), these Regulations apply to UCITS deemed to be established in the State as specified in Regulation 6.
(2)Subject to paragraph
(9), Part 12 applies to UCITS authorised in another Member State which proposes to market units in the State.
(3)Subject to paragraph
(9), for the purposes of these Regulations, UCITS are undertakings— (
  1. a)the sole object of which is the collective investment in either or both— (
  2. i)transferable securities, (
  3. ii)other liquid financial assets referred to in Regulation 68, of capital raised from the public and which operate on the principle of risk-spreading, and (
  4. b)the units of which are, at the request of holders, repurchased or redeemed, directly or indirectly, out of those undertakings’ assets.
(4)Action taken by a UCITS to ensure that the stock exchange value of its units does not vary significantly from their net asset value shall be regarded as equivalent to repurchase or redemption referred to in paragraph
(3)(b).
(5)UCITS may consist of several sub-funds.
(6)UCITS may be constituted as— (
  1. a)unit trusts, (
  2. b)investment companies with fixed capital that are registered as public limited companies, (
  3. c)investment companies with variable capital that are registered as public limited companies and the articles of which provide that— (
  4. i)the amount of the paid-up share capital of the investment company concerned shall at all times be equal to the net asset value of the company, and (
  5. ii)the shares of the investment company concerned shall have no par value, or (
  6. d)common contractual funds.
(7)A UCITS to which these Regulations apply shall not convert itself into a collective investment undertaking which would not be subject to the Directive and any such purported conversion shall be void.
(8)Without prejudice to Part 7, a UCITS to which these Regulations apply and which proposes to convert itself into a collective investment undertaking to which these Regulations apply shall comply with such conditions as the Bank may consider prudent to specify in relation to the conversion, for the purposes and in the interest of the orderly and proper regulation of UCITS in accordance with these Regulations.
(9)These Regulations do not apply to— (
  1. a)investment companies the assets of which are invested through the intermediary of subsidiary companies wholly or mainly otherwise than in transferable securities, (
  2. b)collective investment undertakings of the closed-ended type, (
  3. c)collective investment undertakings which raise capital without promoting the sale of their units to the public within the Community or any part of it, and (
  4. d)collective investment undertakings the units of which, under the fund rules or the instruments of incorporation of the investment company concerned, may be sold only to the public in third countries. Restriction of Unit Trusts Act 1990 5. The Unit Trusts Act 1990 (No. 37 of 1990) shall not apply to UCITS authorised under these Regulations or authorised by a competent authority in another Member State in accordance with the Directive. UCITS established in the State 6. For the purposes of these Regulations, a UCITS which is authorised by the Bank pursuant to these Regulations shall be deemed to be established in the State. PART 3 Authorisation of UCITS Prohibition on UCITS carrying on activities in the State without authorisation 7.
(1)Subject to paragraph
(2)and Regulations 8 and 10, a UCITS to which these Regulations apply shall not carry on activities as such in the State unless it has been authorised under these Regulations by the Bank.
(2)A UCITS which is established in another Member State and which has received authorisation from the competent authority in that State pursuant to the Directive may market its units in the State provided it complies with the requirements of Part 12. Requirements for authorising unit trust, common contractual fund or investment company 8.
(1)A unit trust or common contractual fund shall be authorised only if the Bank— (
  1. a)has approved the application of the management company to manage the unit trust or common contractual fund, (
  2. b)has approved the trust deed or deed of constitution, and (
  3. c)has approved the choice of trustee.
(2)An investment company shall be authorised only if the Bank— (
  1. a)has approved its articles, (
  2. b)has approved the choice of trustee, (
  3. c)where relevant, has approved the application of the designated management company to manage it, and (
  4. d)is satisfied that it complies with the requirements of Part 6. Application of management company not established in the State 9. Without prejudice to Regulation 8, where a management company is not established in the State, the Bank shall decide the application for authorisation of the UCITS in accordance with Regulation 31. Circumstances in which Bank shall not authorise UCITS 10.
(1)The Bank shall not authorise a UCITS which appoints a management company if the management company is not authorised for the management of UCITS in the management company’s home Member State.
(2)The Bank shall not authorise a UCITS if any of the directors of the trustee are not of sufficiently good repute or are not sufficiently experienced.
(3)For the purposes of paragraph
(2), a trustee shall forthwith communicate to the Bank the names of the directors of the trustee and of every person succeeding them in office.
(4)The Bank shall not authorise a UCITS if it is legally prevented from marketing its units in the State, including through a provision in the trust deed, deed of constitution or articles. Time limit within which Bank shall inform management or investment company whether or not it is authorised 11. Without prejudice to Regulation 42
(4)(d), the Bank shall inform a management company or, where applicable, an investment company, within 2 months of the submission of a complete application, whether or not authorisation of the UCITS has been granted. Approval of Bank necessary for subsequent changes
  1. Neither the management company nor the trustee shall be replaced, nor shall the trust deed, the deed of constitution or the investment companys articles be amended, without the approval of the Bank. Applications for authorisation
  2. An application for authorisation shall be made in writing by a management company or the investment company and shall contain such information, including additional information, as the Bank may reasonably specify for the purpose of determining the application. Bank shall make law, etc. on UCITS accessible 14.
(1)The Bank shall ensure that complete information on the laws, regulations and administrative provisions implementing the Directive which relates to the constitution and functioning of the UCITS are easily accessible at a distance or by electronic means.
(2)The Bank shall ensure that such information is available in the English language in a clear and unambiguous manner and kept up to date. PART 4 Obligations regarding Management Companies Chapter 1 Conditions for taking up business Authorisation of management company
  1. Subject to these Regulations, the Bank may grant or refuse to grant to a management company applying to it under these Regulations an authorisation to operate as a management company. The grant of authorisation is subject to the conditions and requirements referred to in Regulations 17 and
  2. Activities of management company 16.
(1)(
  1. a)Save as otherwise provided for in this Regulation, a management company shall not engage in activities other than the management of UCITS authorised according to these Regulations or the Directive and other collective investment undertakings which are not covered by these Regulations and for which the management company is subject to prudential supervision but which cannot be marketed in other Member States under the Directive. (
  2. b)The activity of the management of unit trusts, common contractual funds and investment companies includes, but is not limited to, the activities specified in Schedule 1.
(2)(
  1. a)Subject to subparagraph (b), a management company may be authorised to provide, as well as the management of collective investment undertakings, the following additional services: (
  2. i)the management of portfolios of investments, including those owned by pension funds, in accordance with mandates given by investors on a discretionary, client-by-client basis, where such portfolios include one or more of the investment instruments listed in Section C of the Annex to the MIFID; (
  3. ii)as non-core services: (I) investment advice concerning one or more of the instruments listed in Annex I, Section C to Directive 2004/39/EC; (II) the safekeeping and administration in relation to units of collective investment undertakings. (
  4. b)A management company shall not be authorised— (
  5. i)to provide only the services referred to in clauses (
  6. i)and (
  7. ii)of subparagraph (a), or (
  8. ii)to provide the non-core services referred to in clause (
  9. ii)of subparagraph (
  10. a)without being authorised to provide the services referred to in clause (
  11. i)of subparagraph (a).
(3)The definition in Regulation 3
(1)of “management company”, and Regulations 32, 33, 76 and 99 to 102 of the MIFID Regulations, shall, with all necessary modifications, apply to the provision of the services referred to in clauses (i) and (ii) of subparagraph (a) of paragraph
(2)by a management company.
(4)A management company which provides individual portfolio management services shall comply with the client asset requirements issued by the Bank under the MIFID Regulations.
(5)As part of the provision of collective portfolio management services, a management company authorised pursuant to these Regulations may maintain client asset accounts for processing subscription and salespersons moneys. In such case, the management company shall comply with the client asset requirements issued by the Bank under the MIFID Regulations, as applicable and subject to any conditions which may be imposed by the Bank pursuant to Regulation 123. Conditions for authorisation of management company and grounds for withdrawal of authorisation 17.
(1)Without prejudice to any other legislative provision, a management company shall not be authorised by the Bank unless— (
  1. a)it is a body corporate with its registered office and head office in the State, (
  2. b)it has an initial capital of at least €125,000, and (
  3. c)the persons who effectively conduct the business of the management company are of sufficiently good repute and are sufficiently experienced in relation to the type of UCITS to be managed by the management company.
(2)(
  1. a)Where close links exist between a management company and other natural or legal persons, the Bank shall grant authorisation only if those links do not prevent the effective exercise of its supervisory functions. (
  2. b)The Bank shall refuse authorisation if the laws, regulations or administrative provisions of a third country governing one or more natural or legal persons with whom a management company has close links, or difficulties involved in their enforcement, prevent the effective exercise of the Bank’s supervisory functions. (
  3. c)The Bank shall require a management company to provide it with the information the Bank requires to monitor compliance with the conditions referred to in this paragraph on a continuous basis.
(3)The conduct of a management company’s business shall be decided by at least 2 persons meeting the conditions specified in paragraph
(1)(c).
(4)Subject to paragraphs
(5)to
(7), when the net asset value of the portfolios of the management company exceeds €250,000,000, the company shall provide an additional amount of own funds which shall be equal to 0.02% of the amount by which the value of the portfolios of the company exceeds €250,000,000.
(5)The total of the initial capital and the additional amount required to be held pursuant to paragraph
(4)by a management company shall not be required to exceed €10,000,000.
(6)The own funds of the management company shall never be less than the amount prescribed by the Bank in accordance with the terms of Directive 2006/49/EC.
(7)(a) A management company need not provide up to 50% of the additional amount of own funds referred to in paragraph
(4)if it benefits from a guarantee of the same amount given by a credit institution or an insurance undertaking. (b) Such credit institution or insurance undertaking shall have its registered office in a Member State but may have its registered office in a third country provided that such institution or undertaking is subject to prudential rules considered by the Bank to be equivalent to those laid down in Community law.
(8)For the purpose of paragraph
(4), the following portfolios shall be deemed to be the portfolios of the management company: (
  1. a)unit trusts and common contractual funds, managed by the company, including portfolios for which it has delegated the management function but excluding portfolios that it is managing under delegation; (
  2. b)investment companies for which the company is the designated management company; and (
  3. c)other collective investment undertakings managed by the company including portfolios for which it has delegated the management function but excluding portfolios that it is managing under delegation.
(9)For the purposes of paragraph
(1)(c), a management company shall forthwith communicate to the Bank the names of the persons who effectively conduct the business of the company and of every person succeeding them in office.
(10)A management company may start business as soon as authorisation has been granted.
(11)The Bank shall inform a proposed management company within 6 months of the date of receipt of a complete application whether or not authorisation has been granted. Reasons shall be given where an authorisation is refused.
(12)A proposed management company which has been refused authorisation may apply to the court in accordance with Regulation 135.
(13)A proposed management company shall have the same right to apply to the court as in paragraph
(12)where the Bank fails to take a decision on authorisation within the time prescribed in paragraph
(11).
(14)The Bank may withdraw the authorisation issued to a management company only where the company— (
  1. a)does not make use of the authorisation within 12 months, expressly renounces the authorisation or has ceased the activity covered by these Regulations for more than the previous 6 months, unless the Bank has provided for the authorisation to lapse automatically in such cases, (
  2. b)has obtained the authorisation by making false statements or by any other irregular means, (
  3. c)no longer fulfils the conditions under which authorisation was granted, (
  4. d)no longer complies with Directive 2006/49/EC if its authorisation also covers the discretionary portfolio management service referred to in Regulation 16
(2)(a)(i), or (e) has seriously or systematically infringed the rules or requirements of the Bank imposed pursuant to these Regulations. Application for authorisation 18.
(1)An application for authorisation of a proposed management company shall be in such form and contain such particulars as the Bank shall reasonably specify from time to time and, without prejudice to the generality of the foregoing, shall include such particulars or information as the Bank may request in relation to— (
  1. a)the type of business to be carried on or likely to be carried on by the company, (
  2. b)any person or persons having a qualifying shareholding in, or having ownership of, the company, and (
  3. c)the memorandum of association and articles of association of the company.
(2)A proposed management company shall not be authorised by the Bank unless it satisfies the Bank— (
  1. a)that the company has made arrangements to ensure that its activities will be carried out in such a manner that the requirements of these Regulations are complied with, (
  2. b)that, where applicable, the memorandum of association and articles of association of the company contain sufficient provision so as to enable it to operate in accordance with these Regulations, and in accordance with any condition or requirement, or both, as the Bank may impose, (
  3. c)it has the minimum level of capital which shall be specified by the Bank, (
  4. d)as to the probity and competence of each of its directors and managers, (
  5. e)as to the suitability of each of its qualifying shareholders, (
  6. f)as to the organisational structure and management skills of the company and that adequate levels of staff and expertise will be employed to carry out its proposed activities, (
  7. g)that it has and will follow established procedures to enable the Bank to be supplied with all information necessary for the Bank to carry out its supervisory functions and to enable the public to be supplied with any information which the Bank may specify, (
  8. h)that the organisation of its business structure is such that it and any of its associated or related undertakings, where appropriate and practicable, are capable of being supervised adequately by the Bank, and (
  9. i)as to its conduct of business, its financial resources and any other matters as the Bank considers necessary in the interests of the proper and orderly regulation and supervision of authorised management companies or in the interests of the protection of investors.
(3)The Bank may impose conditions or requirements, from time to time, in respect of the level of capital to be maintained by an authorised management company and shall have regard to the capital requirements set out in these Regulations and the MIFID Regulations.
(4)The Bank may require that an appointment as a director of an authorised management company or proposed management company or to the post of chief executive or manager or post equivalent thereto, on or after the granting of an authorisation under these Regulations, shall be subject to the prior approval in writing of the Bank. Such approval shall not be given unless the authorised management company or proposed management company satisfies the Bank as to the probity and competence of the proposed appointee.
(5)The Bank may direct an authorised management company to alter its memorandum or articles of association in the interest of the proper and orderly regulation and supervision of management companies, or the protection of investors, or both.
(6)An authorisation granted by the Bank under these Regulations shall specify the classes of services which may be provided by an authorised management company.
(7)(
  1. a)The Bank may authorise in writing such and so many persons to be authorised officers for the purposes of these Regulations and may revoke such authorisations. (
  2. b)The Bank may at any time prior to the grant or refusal of an authorisation request further information from the proposed management company or may instruct an authorised officer to make such inquiries or carry out such investigations as may be necessary for the purpose of evaluating properly an application under these Regulations and such inquiries or investigations shall be carried out in accordance with these Regulations.
(8)The Bank shall consult the competent authority of the other Member State involved before authorising a proposed management company which is— (
  1. a)a subsidiary of another management company, an investment firm, a credit institution or an insurance undertaking authorised in another Member State, (
  2. b)a subsidiary of the parent undertaking of another management company, an investment firm, a credit institution or an insurance undertaking authorised in another Member State, or (
  3. c)controlled by the same natural or legal persons as control another management company, an investment firm, a credit institution or an insurance undertaking authorised in another Member State.
(9)(
  1. a)In the case of a management company, the Bank shall apply these Regulations, having regard to the division of responsibilities between the management company’s home Member State and the management company’s host Member State, which are set out in the Directive, and the relevant provisions of these Regulations shall be construed accordingly. (
  2. b)Subject to these Regulations, a management company shall comply with such conditions or requirements, or both, as may be imposed on it by the Bank in the interests of any or all of the following: (
  3. i)the proper and orderly regulation and supervision of a management company; (
  4. ii)the protection of investors or clients or both.
(10)The Bank may impose requirements on a proposed management company or an authorised management company to organise its business or corporate structure or control of any associated undertaking or related undertaking not supervised by the Bank such that the management company when authorised under these Regulations and, where appropriate and practicable, the business of any associated undertaking or related undertaking, either collectively or individually, is capable of being supervised to the satisfaction of the Bank under these Regulations. Chapter 2 Relations with third countries Relations with third countries 19.
(1)The Bank shall inform the Commission of any general difficulties which UCITS encounter in marketing their units in any third country.
(2)The Bank shall cooperate with the Commission on matters relating to third countries pertaining to the Directive. Chapter 3 Operating conditions Duty of Bank to ensure that management companies comply with Regulations 16 and 17 20.
(1)The Bank shall require that an authorised management company complies at all times with the conditions laid down in Regulations 16 and 17
(1)to
(9).
(2)(
  1. a)The own funds of a management company may not fall below the level required by Regulation 17. (
  2. b)Where they do, however, the Bank may, where the circumstances justify it, allow such management company a limited time period in which to rectify the situation or cease its activities. Qualifying holdings 21.
(1)Qualifying holdings in management companies shall be subject to the same rules as set out in Article10 of the MIFID on investment in the securities field.
(2)The relevant provisions shall, with all necessary modifications, apply to qualifying holdings in management companies as they apply to acquiring transactions in investment firms within the meaning of the MIFID Regulations.
(3)Part 15 of the MIFID Regulations shall, to the extent that it relates to the relevant provisions applied as specified in paragraph
(2), apply, with all necessary modifications, to the relevant provisions as so applied.
(4)Part 16 of the MIFID Regulations shall, with all necessary modifications, to the extent that it relates to the relevant provisions applied as specified in paragraph
(2), apply, with all necessary modifications, to the relevant provisions as so applied.
(5)For the purposes of this Regulation— (
  1. a)the expressions “firm/investment firm” and “investment firms” contained in Article 10 of the MIFID, any of the relevant provisions, or Part 15 or 16 of the MIFID Regulations, shall be construed as “management company” and “management companies” respectively, and (
  2. b)the term “the relevant provisions” means— (
  3. i)Regulations 13 and 30 of the MIFID Regulations, and (
  4. ii)Part 14 of the MIFID Regulations. Prudential rules 22.
(1)The Bank shall draw up prudential rules which management companies, with regard to the activity of management of UCITS authorised according to these Regulations, shall observe at all times.
(2)In particular, the Bank having regard also to the nature of the UCITS managed by a management company, shall require that each such company— (
  1. a)has sound administrative and accounting procedures, control and safeguard arrangements for electronic data processing and adequate internal control mechanisms including, in particular, rules for personal transactions by its employees or for the holding or management of investments in financial instruments in order to invest on its own funds and ensuring, inter alia, that each transaction involving the fund may be reconstructed according to its origin, the parties to it, its nature, and the time and place at which it was effected and that the assets of the unit trusts, common contractual funds or of the investment companies managed by the management company are invested according to the fund rules or the instruments of incorporation and the legal provisions in force, and (
  2. b)is structured and organised in such a way as to minimise the risk of UCITS’ or clients’ interests being prejudiced by conflicts of interest between the company and its clients, between one of its clients and another, between one of its clients and a UCITS or between 2 UCITS.
(3)Each management company the authorisation of which also covers the discretionary portfolio management service referred to in Regulation 16
(2)(a)(i)— (
  1. a)shall not invest all or a part of an investors portfolio in units of unit trusts, common contractual funds or of investment companies it manages, unless it receives prior general approval from the client, and (
  2. b)shall be subject with regard to the services referred to in clauses (
  3. i)and (
  4. ii)of subparagraph (
  5. a)of Regulation 16
(2)to the provisions laid down in Directive 97/9/EC of the European Parliament and of the Council of 3 March 199711 on investor-compensation schemes and comply with the Investor Compensation Act 1998 (No. 37 of 1998).
(4)The requirements specified in Schedule 4 shall have effect for the purposes of this Regulation. Delegations 23.
(1)A management company may delegate activities to third parties for the purpose of the more efficient conduct of the company’s business provided that— (
  1. a)the management company has informed the Bank in an appropriate manner (whereupon the Bank shall, without delay, transmit the information to the competent authority of the home Member State of a UCITS managed by that management company), (
  2. b)the delegation mandate does not prevent the effectiveness of supervision over the management company, and in particular it shall not prevent the management company from acting, or the UCITS from being managed, in the best interests of its investors, (
  3. c)when the delegation concerns investment management, the mandate is only given to undertakings which are authorised or registered for the purpose of asset management and subject to prudential supervision; the delegation shall be in accordance with investment-allocation criteria periodically laid down by a management company, (
  4. d)where the mandate concerns investment management and is given to a third country undertaking, cooperation between the Bank and the supervisory authorities of the third country concerned is ensured, (
  5. e)a mandate with regard to the core function of investment management is not given to the trustee or to any other undertaking whose interests may conflict with those of the management company or the unit-holders, (
  6. f)measures are put in place which enable the persons who conduct the business of the management company to monitor effectively at any time the activity of the undertaking to which the mandate is given, (
  7. g)the mandate does not prevent the persons who conduct the business of the management company either from giving at any time further instructions to the undertaking to which functions are delegated or from withdrawing the mandate or both with immediate effect when this is in the interest of investors, (
  8. h)having regard to the nature of the functions to be delegated, the undertaking to which functions will be delegated is qualified and capable of undertaking the functions in question, and (
  9. i)the prospectuses issued by a UCITS list the functions which a management company has been permitted to delegate in accordance with this Regulation.
(2)Neither the management companys nor the trustee’s liability shall be affected by the fact that the management company delegated any functions to third parties, nor shall the management company delegate its functions to the extent that it becomes a letterbox entity. Rules of conduct 24.
(1)The Bank shall draw up rules of conduct which authorised management companies shall observe at all times. Such rules shall implement at least the principles set out in this paragraph. Those principles shall ensure that a management company— (
  1. a)acts honestly and fairly in conducting its business activities in the best interests of the UCITS it manages and the integrity of the market, (
  2. b)acts with due skill, care and diligence, in the best interests of the UCITS it manages and the integrity of the market, (
  3. c)has and employs effectively the resources and procedures that are necessary for the proper performance of its business activities, (
  4. d)tries to avoid conflicts of interest and, when they cannot be avoided, ensures that the UCITS it manages are fairly treated, and (
  5. e)complies with all regulatory requirements applicable to the conduct of its business activities so as to promote the best interests of its investors and the integrity of the market.
(2)The requirements specified in Schedule 5 shall have effect for the purposes of this Regulation. Investor complaints 25.
(1)(
  1. a)Management companies or, where relevant, investment companies shall establish, implement and maintain transparent procedures and arrangements to ensure that they deal properly and promptly with investor complaints. Those measures shall allow investors to file complaints in the official language or one of the official languages of their Member State. (
  2. b)Management companies shall also establish appropriate procedures and arrangements to make information available at the request of the public or the Bank.
(2)Management companies shall ensure that each complaint and the measures taken for its resolution are recorded.
(3)Management companies shall ensure that investors shall be able to file complaints free of charge. The information regarding procedures referred to in paragraph
(1)shall be made available to investors free of charge. Chapter 2 Freedom of establishment and freedom to provide services Establishment of branch and provision of services 26.
(1)A management company, authorised by the competent authority of another Member State in accordance with the Directive, may carry on within the State the activity for which it has been authorised, either by the establishment of a branch or under the freedom to provide services.
(2)Where a management company so authorised proposes, without establishing a branch, only to market the units of the UCITS it manages as provided for in Schedule 1 in the State, without proposing to pursue any other activities or services, such marketing shall be subject only to the requirements of Part 12.
(3)The establishment of a branch or the provision of the services shall not be subject to any authorisation requirement, to any requirement to provide endowment capital or to any other measure having equivalent effect.
(4)Subject to the conditions set out in these Regulations, a UCITS shall be free to designate, or to be managed by a management company authorised in a Member State other than the State, provided that such a management company complies with— (a) Regulation 27 or 28, and (b) Regulations 29 to 30. Establishment of branch in another Member State 27.
(1)Every management company wishing to establish a branch within the territory of another Member State shall be required to notify the Bank and to provide the following information and documents when effecting the notification: (
  1. a)the Member State within the territory of which the management company plans to establish a branch; (
  2. b)a programme of operations setting out the activities and services envisaged and the proposed organisational structure of the branch; (
  3. c)a description of the risk management process put in place by the management company, including a description of the procedures and arrangements taken in accordance with Regulation 25; (
  4. d)the address of the management company in the management company’s host Member State from which documents may be obtained; and (
  5. e)the names of those responsible for the management of the branch.
(2)(a) Unless the Bank has reason to doubt the adequacy of the administrative structure or the financial situation of a management company, taking into account the activities envisaged, it shall, within 2 months of receiving all the information referred to in paragraph
(1), communicate that information to the competent authority of the host Member State and shall inform the management company accordingly. (
  1. b)The Bank shall also communicate to the competent authority of the host Member State details of any compensation scheme intended to protect investors. (
  2. c)Where the Bank refuses to communicate the information referred to in paragraph
(1)to the competent authority of the management company’s host Member State, the Bank shall give reasons for its refusal to the management company concerned within 2 months of receiving all the information. The Bank’s refusal or their failure to reply shall be subject to the right to apply to the court as provided for in Regulation 135.
(3)Where a management company wishes to pursue the activity of collective portfolio management referred to in Schedule 1, the Bank shall enclose with the documentation sent to the competent authority of the management company’s host Member State an attestation that the management company has been authorised pursuant to these Regulations, a description of the scope of the management company’s authorisation and details of any restriction on the types of UCITS that the management company is authorised to manage.
(4)A management company, authorised under these Regulations, which pursues activities by a branch within the territory of the management company’s host Member State shall comply with the rules drawn up by the management company’s host Member State pursuant to Regulation 24.
(5)The competent authority of the management company’s host Member State shall be responsible for supervising compliance with paragraph
(4).
(6)Before the branch of a management company authorised in another Member State starts business within the State, the Bank, acting as the competent authority of the management company’s host Member State, shall within 2 months of receiving the information referred to in paragraph
(1), prepare for supervising the compliance of the management company with the rules under its responsibility.
(7)On receipt of a communication from the Bank or on the expiry of the 2 month period provided for in paragraph
(6)without receipt of any communication from the Bank, the branch may be established and start business.
(8)In the event of a change in any particulars communicated in accordance with paragraph
(1)(b), (c), (d) or (e), a management company shall give notice in writing of the change to the Bank and the competent authority of the management company’s host Member State at least one month before implementing the change so that the Bank, acting as either the competent authority of the management company’s home Member State or management company’s host Member State, may take a decision on the change under paragraph
(2)or
(6), as the case may be.
(9)In the event of a change in the particulars communicated in accordance with paragraph
(2)(a) and (b), the Bank shall inform the competent authority of the management company’s host Member State accordingly.
(10)The Bank shall update the information contained in the attestation referred to in paragraph
(3)and inform the competent authority of the management company’s host Member State whenever there is a change in the scope of the management company’s authorisation or in the details of any restriction on the types of UCITS that the management company is authorised to manage. Provision of information 28.
(1)When a management company wishes to pursue activities for which it has been authorised by the Bank within the territory of another Member State for the first time under the freedom to provide services, it shall notify the Bank and provide it with the following information: (
  1. a)the Member State within the territory of which the management company intends to operate; and (
  2. b)a programme of operations stating the activities and services it will undertake, including a description of the risk management process put in place by the management company and a description of the procedures and arrangements taken in accordance with Regulation 24.
(2)(a) The Bank shall, within one month of receiving the information referred to in paragraph
(1), forward it to the competent authority of the management company’s host Member State. (
  1. b)The Bank shall also communicate details of any applicable compensation scheme intended to protect investors. (
  2. c)Where a management company wishes to pursue the activity of collective portfolio management as referred to in Schedule 1, the Bank shall enclose with the documentation sent to the competent authority of the management company’s host Member State an attestation that the management company has been authorised pursuant to these Regulations, a description of the scope of the management company’s authorisation and details of any restriction on the types of UCITS that the management company is authorised to manage. (
  3. d)The management company may then start business in the host Member State in accordance with the Directive.
(3)A management company, authorised under these Regulations, which pursues activities under the freedom to provide services shall comply with the rules drawn up by the Bank pursuant to Regulation 24.
(4)Where the content of the information communicated in accordance with paragraph
(1)(b) is amended, the management company shall give notice in writing of the amendment to the Bank and to the management company’s host Member State before implementing the change. The Bank shall update the information contained in the attestation referred to in paragraph
(2)and inform the competent authority of the management company’s host Member State whenever there is a change in the scope of the management company’s authorisation or in the details of any restriction on the types of UCITS that the management company is authorised to manage. Compliance with rules which relate to constitution and functioning of UCITS, etc 29.
(1)A management company shall decide and be responsible for adopting and implementing all the arrangements and organisational decisions which are necessary to ensure compliance with the rules which relate to the constitution and functioning of the UCITS and with the obligations set out in the fund rules or in the instruments of incorporation, and with the obligations set out in the prospectus.
(2)The Bank shall ensure that a management company authorised by it is not subject to any additional requirements established in the UCITS home Member State in respect of the subject matter of these Regulations and the Directive, except in the cases expressly referred to in these Regulations and the Directive. Provision of documentation to competent authority 30.
(1)(
  1. a)Without prejudice to Part 3, a management company which applies to manage a UCITS established in another Member State shall provide the competent authority in the UCITS home Member State with the following documentation: (
  2. i)the agreement in writing with the trustee referred to in Regulations 35
(6)and 51
(3); and (
  1. ii)information on delegation arrangements regarding functions of investment management and administration referred to in Schedule 1. (
  2. b)Where a management company already manages other UCITS of the same type in the UCITS home Member State, reference to the documentation already provided shall be sufficient.
(2)Upon request and in so far as it is necessary to ensure compliance with the rules for which they are responsible, the Bank may provide clarification and information regarding the documentation referred to in paragraph
(1)and, based on the attestations referred to in Regulations 27
(3)and 28
(2), as to whether the type of UCITS for which authorisation is requested falls within the scope of the management company’s authorisation to the competent authority of the UCITS home Member State. Where applicable, the Bank shall provide its opinion within 10 working days of the initial request.
(3)Any subsequent material modifications of the documentation referred to in paragraph
(1)shall be notified by the management company concerned to the competent authority of the UCITS home Member State. Provision of documentation to Bank 31.
(1)(
  1. a)Without prejudice to Part 3, a management company authorised in a Member State other than the State which applies to manage a UCITS established in the State shall provide the Bank with the following documentation: (
  2. i)the agreement in writing with the trustee referred to in Regulations 35
(6)and 51
(3); and (
  1. ii)information on delegation arrangements regarding functions of investment management and administration referred to in Schedule 1. (
  2. b)Where a management company already manages other UCITS of the same type in the State, reference to the documentation already provided shall be sufficient.
(2)In so far as it is necessary to ensure compliance with the rules for which it is responsible, the Bank may ask the competent authority of the management company’s home Member State for clarification and information regarding the documentation referred to in paragraph
(1)and, based on the attestations referred to in Regulations 27
(3)and 28
(2), as to whether the type of UCITS for which authorisation is requested falls within the scope of the management company’s authorisation. The competent authority of the management company’s home Member State shall provide their opinion within 10 working days of the initial request.
(3)(
  1. a)The Bank may refuse the application of the management company only where— (
  2. i)the management company does not comply with the rules falling under their responsibility pursuant to Regulation 29, (
  3. ii)the management company is not authorised by the competent authority of the management company’s home Member State to manage the type of UCITS for which authorisation is requested, or (iii) the management company has not provided the documentation referred to in paragraph
(1). (b) Before refusing an application, the Bank shall consult the competent authority of the management company’s home Member State.
(4)Any subsequent material modifications of the documentation referred to in paragraph
(1)shall be notified by the management company concerned to the Bank. Provisions applicable to management company authorised in another Member State 32.
(1)The Bank may, for statistical purposes, require a management company authorised in another Member State, which has a branch in the State, to report periodically on its activities in the State.
(2)(
  1. a)The Bank may require a management company, authorised in another Member State which carries on business within the State, to provide information necessary to monitor its compliance with these Regulations. (
  2. b)Management companies shall provide information on the procedures and arrangements in relation to investor complaints as required under Regulation 25 to the Bank upon request.
(3)Where the Bank ascertains that a management company that has a branch or provides services within the State is in breach of one of the rules under the Bank’s responsibility, it shall require the company to put an end to that breach and inform the competent authority of the management company’s home Member State of the breach.
(4)Where the management company concerned refuses to provide the Bank with information falling under its responsibility, or fails to take the necessary steps to put an end to the breach referred to in paragraph
(3), the Bank, acting as the competent authority of the host Member State, shall inform the competent authority of the management company’s home Member State accordingly.
(5)Where the management company continues to refuse to provide the information requested by the Bank pursuant to paragraph
(2), or persists in breaching the legal or regulatory provisions in force in the State, the Bank may, after informing the competent authority of the management company’s home Member State, take appropriate measures, including under Regulations 126 and 127, to prevent or to penalise further irregularities and, in so far as is necessary, to prevent that management company from initiating any further transaction within the State. Where the service provided within the State is the management of a UCITS, the Bank may require the management company to cease managing the UCITS.
(6)Any measure adopted pursuant to paragraphs
(4)or
(5)involving measures or penalties shall be properly justified and communicated to the management company concerned. Every such measure shall be subject to the right to apply to the court as provided for in Regulation 135.
(7)Before following the procedure laid down in paragraph
(3),
(4)or
(5), the Bank may, in emergencies, take any precautionary measures necessary to protect the interests of investors and others for whom services are provided. The Bank shall inform the Commission and the competent authority of the other Member States concerned of such measures at the earliest opportunity.
(8)Having been consulted by the competent authority of the management company’s home Member State before the withdrawal of that management company’s authorisation, the Bank, as competent authority of the UCITS home Member State, shall take appropriate measures to safeguard investors’ interests. Those measures may include decisions preventing the management company concerned from initiating any further transactions within the State.
(9)The Bank shall inform the Commission of the number and type of cases in which they refuse authorisation under Regulation 27 or an application under Regulation 30 and of any measures taken in accordance with paragraph
(5). PART 5 Obligations Regarding Trustee Safe-keeping of assets 33.
(1)The assets of a unit trust and the assets of a common contractual fund shall be entrusted to a trustee for safe-keeping in accordance with these Regulations.
(2)A trustees liability as referred to in Regulation 36 shall not be affected by the fact that it has entrusted to a third party some or all of the assets in its safe-keeping. Obligations of trustee 34.
(1)The trustee shall— (
  1. a)ensure that the sale, issue, repurchase, redemption and cancellation of units effected on behalf of a unit trust, common contractual fund or by a management company are carried out in accordance with these Regulations and the trust deed or the deed of constitution, as the case may be, (
  2. b)ensure that the value of units is calculated in accordance with these Regulations and the trust deed in the case of a unit trust or the deed of constitution in the case of a common contractual fund, (
  3. c)carry out the instructions of the management company unless they conflict with these Regulations or the trust deed in the case of a unit trust or the deed of constitution in the case of a common contractual fund, (
  4. d)ensure that in transactions involving the assets of a unit trust or of a common contractual fund any consideration is remitted to it within the usual time limits, and (
  5. e)ensure that the income of a unit trust or of a common contractual fund is applied in accordance with these Regulations and, as the case may be, the trust deed or the deed of constitution.
(2)The trustee shall enquire into the conduct of the management company in the management of the unit trust or common contractual fund, as the case may be, in each annual accounting period and report thereon to the unit-holders. The trustee’s report shall be delivered to the management company in good time to enable it to include a copy of the report in the annual report required under Regulation 88. The report shall state whether in the trustees opinion the management has managed the unit trust or the common contractual fund, as the case may be, in that period— (
  1. a)in accordance with the limitations imposed on the investment and borrowing powers of the manager and trustee by the trust deed or deed of constitution, as the case may be, and these Regulations, and (
  2. b)otherwise in accordance with the provisions of the trust deed or deed of constitution, as the case may be, and these Regulations, and, if it has not done so, in what respects it has not done so and the steps which the trustee has taken in respect thereof. Trustee 35.
(1)A trustee shall have its registered office in the State or have established a place of business in the State if its registered office is in another Member State.
(2)A trustee shall— (
  1. a)be a credit institution authorised in the State with paid-up share capital which is not less than the limit specified in the Bank’s Licensing Requirements, or (
  2. b)be a branch, established in the State, of a credit institution with a paid-up share capital which is not less than the limit specified in the Bank’s Licensing Requirements, (
  3. c)be a company incorporated in the State which— (
  4. i)is wholly owned by a credit institution, provided the liabilities of the trustee are guaranteed by the credit institution and the credit institution has a paid-up share capital which is not less than the limit specified in the Bank’s Licensing Requirements, (
  5. ii)is wholly owned by an institution in a third country which is deemed by the Bank to be the equivalent of a credit institution, provided the liabilities of the trustee are guaranteed by the credit institution and that credit institution has a paid-up share capital which is not less than the limit specified in the Bank’s Licensing Requirements, or (iii) is wholly owned by an institution or company either in a Member State or in a third country which is deemed by the Bank to be an institution or company which provides unit-holders with protection equivalent to that provided by a trustee under subparagraph (a), (
  6. b)or (c)(
  7. i)or (
  8. ii)and provided the liabilities of the company acting as trustee are guaranteed by the said institution or company and that institution or company has a paid-up share capital which is not less than the limit specified in the Bank’s Licensing Requirements.
(3)A trustee shall satisfy the Bank that it has the appropriate expertise and experience to carry out its functions under these Regulations.
(4)In this Regulation, the Bank’s Licensing Requirements means the Banks Licensing and Supervision Requirements and Standards for Credit Institutions as issued by the Bank from time to time.
(5)The trustee shall enable the Bank to obtain, on request, all information that the trustee has obtained while discharging its duties and that is necessary for the Bank to supervise the UCITS compliance with these Regulations.
(6)Where the management company’s home Member State is not the State, the trustee shall sign an agreement in writing with the management company regulating the flow of information deemed necessary to allow it to perform the functions set out in Regulation 34 and in other laws, regulations or administrative provisions which are relevant for trustees in the State.
(7)The requirements specified in Schedule 6 shall have effect for the purposes of this Regulation. Liability of trustee 36.
(1)A trustee shall be liable to the management company and the unit-holders for any loss suffered by them as a result of its unjustifiable failure to perform its obligations or its improper performance of them.
(2)Liability to unit-holders may be invoked either directly or indirectly through the management company, depending on the legal nature of the relationship between the trustee, the management company and the unit-holders. Prohibition against single company acting as both management company and trustee 37.
(1)No single company shall act as both management company and trustee in respect of the same UCITS and in the context of their respective roles the management company and the trustee must act independently and solely in the interest of the unit-holders.
(2)The assets of a UCITS established as either a unit trust or common contractual fund shall belong exclusively to the UCITS. The assets shall be segregated from the assets of the trustee or its agents or both and shall not be used to discharge directly or indirectly liabilities or claims against any other undertaking or entity and shall not be available for any such purpose.
(3)Where a UCITS established as a unit trust or common contractual fund is constituted as an umbrella fund, the assets shall belong exclusively to the relevant sub-fund and shall not be used to discharge directly or indirectly the liabilities of or claims against any other sub-fund and shall not be available for any such purpose.
(4)The liabilities of a unit-holder shall be limited to the amount agreed to be contributed by him or her for the subscription of units. The provisions of the trust deed or the deed of constitution shall be binding on the unit-holders and all persons claiming through the unit-holders as if such persons had been party to the trust deed or to the deed of constitution, as the case may be. Trust deed, etc. to lay down conditions for replacement of management company, etc 38. In relation to unit trusts, the trust deed and, in relation to common contractual funds, the deed of constitution, shall lay down the conditions for the replacement of the management company and the trustee and rules to ensure the protection of unit-holders in the event of such replacement. PART 6 Obligations Regarding Investment Companies Chapter 1 Conditions for taking up business Investment companies with fixed capital 39.
(1)This Regulation applies to an investment company with fixed capital authorised under these Regulations.
(2)A company to which this Regulation applies shall include the words “investment company” or “cuideachta infheistíochta” on all its deeds, announcements, publications, letters and other documents.
(3)(
  1. a)Subject to this Regulation, a company to which this Regulation applies may, if so authorised by its articles, issue redeemable preference shares which are liable at the option of the shareholder to be redeemed, and redeem them accordingly. (
  2. b)The issue and redemption of shares by a company pursuant to subparagraph (
  3. a)shall be subject to the following conditions: (
  4. i)no redeemable shares shall be redeemed unless they are fully paid; (
  5. ii)no such shares shall be redeemed except out of profits available for distribution or out of the proceeds of a fresh issue of shares made for the purposes of redemption; and (iii) the premium, if any, payable on redemption shall have been provided for out of the profits of the company or out of the companys share premium account before the shares are redeemed. (
  6. c)Shares redeemed under this paragraph shall be treated as cancelled on redemption and the amount of the companys issued share capital shall be reduced by the nominal value of those shares accordingly but no such cancellation shall be taken as reducing the amount of the companys authorised share capital. (
  7. d)Where redeemable shares are— (
  8. i)redeemed wholly out of profits available for distribution, or (
  9. ii)redeemed wholly or partly out of the proceeds of a fresh issue and the aggregate amount of those proceeds is less than the aggregate nominal value of the shares redeemed (“the aggregable difference”) then a sum equal to, in the case of clause (
  10. i)of this paragraph, the nominal amount of the shares redeemed and, in the case of clause (ii), the aggregable difference, shall be transferred to a reserve fund ("the capital redemption reserve fund") and the provisions of the Companies Acts relating to the reduction of the share capital of a company shall, except as provided in this section, apply as if the capital redemption reserve fund were paid-up share capital of the company. (
  11. e)Subject to this paragraph and Regulation 104, the redemption of shares may be effected on such terms and in such manner as may be provided by the articles of the company.
(4)The following provisions of the Companies Acts shall, in so far as the redemption of shares is made in accordance with these Regulations, not apply to a company to which this Regulation applies: (
  1. a)the Companies Act 1963 — section 53 (minimum subscription and amount payable on application), section 58 (return as to allotments), section 60 (giving of financial assistance by a company for the purchase of its shares), section 69 (notice to registrar of certain alterations in share capital), section 70 (notice of increase in share capital), section 72 (power of company to reduce its share capital), section 119 (inspection of register and index), section 125 (annual return to be made by a company having a share capital); (
  2. b)the Companies (Amendment) Act 1983 (No. 13 of 1983)— section 5
(2)(minimum amount of share capital), section 6 (restriction on the commencement of business by a public limited company), section 19 (meaning of “authorised minimum”), sections 20
(3)and 20
(4)(duration of authority to allot securities), section 22 (document containing offer to state whether shares will be allotted where issue not fully subscribed), sections 23 to 25 (pre-emption rights), sections 30 to 33 (experts’ reports on non-cash consideration before allotment of shares), section 40 (obligation to convene extraordinary general meeting in event of serious loss of capital), section 41
(1)(restriction on company acquiring its own shares), Part IV (restrictions on distribution of profits and assets); (
  1. c)the Companies (Amendment) Act 1986 (No. 25 of 1986)— section 14 (information to be included in directors’ report regarding acquisition by company of own shares); (
  2. d)the Companies Act 1990 — chapters 2 to 4 of Part IV, section 140 (company may be required to contribute to debt of related company, whether as regards a case in which the investment company is being wound up or a case in which it is a related company within the meaning of that section), Part XI. Investment companies with variable capital 40.
(1)This Regulation applies to an investment company with variable capital authorised under these Regulations.
(2)A company to which this Regulation applies shall include the words “investment company with variable capital” or “cuideachta infheistíochta le caipiteal athraitheach” on all its deeds, announcements, publications, letters and other documents.
(3)(
  1. a)Subject to this Regulation, a company to which this Regulation applies may, if so authorised by its articles, repurchase its own shares provided that no such shares shall be repurchased unless they are fully paid. (
  2. b)Subject to this Regulation, the repurchase of shares may be effected on such terms and in such a manner as may be provided for by the articles of the company.
(4)(
  1. a)Subject to this paragraph and Regulation 104, a company to which this Regulation applies shall, if requested to do so by a shareholder, repurchase such of the shareholders shares as may be requested by the shareholder. (
  2. b)Shares which have been repurchased under subparagraph (
  3. a)shall be treated as cancelled and the amount of the companys issued share capital shall be reduced accordingly.
(5)(
  1. a)A company to which this Regulation applies and which is established as an umbrella fund may acquire by way of subscription or transfer for consideration shares in one sub-fund of the company for the account of another sub-fund of the company in accordance with Regulation 73. (
  2. b)Units acquired under Regulation 73 may be held for the account of the sub-fund for which they were acquired and need not be cancelled.
(6)For the avoidance of doubt, nothing in the Companies Acts or in these Regulations shall require a company to which this Regulation applies to create a legal reserve.
(7)(
  1. a)The following provisions of the Companies Acts shall not apply to a company to which this Regulation applies: (
  2. i)the Companies Act 1963 — section 53 (minimum subscription and amount payable on application), section 58 (return as to allotments), section 60 (giving of financial assistance by a company for the purchase of its shares), section 69 (notice to registrar of certain alterations in share capital), section 70 (notice of increase in share capital), section 72 (power of company to reduce its share capital), section 119 (inspection of register and index), section 125 (annual return to be made by a company having a share capital); (
  3. ii)the Companies (Amendment) Act 1983 — section 5
(2)(minimum amount of share capital), section 6 (restriction on the commencement of business by a public limited company), section 19 (meaning of “authorised minimum”), section 20
(3)and
(4)(duration of authority to allot securities), section 22 (document containing offer to state whether shares will be allotted where issue not fully subscribed), sections 23 to 25 (pre-emption rights), sections 30 to 33 (experts’ reports on non-cash consideration before allotment of shares), section 40 (obligation to convene extraordinary general meeting in event of serious loss of capital), section 41 (restriction on company acquiring its own shares), section 43 (treatment of shares held by or on behalf of a public limited company, section 43A (accounting for own shares)), Part IV (restrictions on distribution of profits and assets); (iii) the Companies (Amendment) Act 1986 — section 14 (information to be included on directors’ report regarding acquisition by company of own shares); (iv) the Companies Act 1990 — chapters 2 to 4 of Part IV, section 140 (company may be required to contribute to debt of related company, whether as regards a case in which the investment company is being wound up or a case in which it is a related company within the meaning of that section), Part XI. (b) Section 6
(4)(a) of the Companies Act 1963 shall have effect in relation to a company to which this Regulation applies as if the words “and the division thereof into shares of a fixed amount” were omitted. Provisions supplementary to Regulations 39 and 40 41.
(1)Sections 5
(1), 36, 213(
  1. d)and 215(a)(
  2. i)of the Companies Act 1963 shall apply in relation to a company to which Regulation 39 or 40 applies as if such a company were a private company.
(2)The registered office of an investment company to which Regulation 39 or 40 applies shall be situated in the State. Authorisation of investment company 42.
(1)(
  1. a)The Bank shall not authorise an investment company if the directors are not of sufficiently good repute and sufficiently experienced in relation to the type of business carried out by the investment company. (
  2. b)The investment company shall communicate to the Bank the names of its directors and of every person succeeding them in office.
(2)An investment company may start business as soon as authorisation has been granted.
(3)An investment company shall only manage assets of its portfolio and shall not, under any circumstances, receive any mandate to manage assets on behalf of a third party.
(4)(
  1. a)The Bank shall not authorise an investment company which has not appointed a management company unless— (
  2. i)the investment company has an initial capital of at least €300,000, (
  3. ii)the investment company has submitted a programme of activity to the Bank setting out at least its organisational structure in the application for authorisation, and (iii) the conduct of the investment company’s business is decided by at least 2 persons who meet the conditions laid down by the Bank in accordance with paragraph (a). (
  4. b)Where close links exist between the investment company and other natural or legal persons, the Bank shall grant authorisation only if those close links do not prevent the effective exercise of its supervisory functions. (
  5. c)The Bank shall refuse authorisation if the laws, regulations or administrative provisions of a third country governing one or more natural or legal persons with whom the investment company has close links, or difficulties involved in their enforcement, prevent the effective exercise of its supervisory functions. (
  6. d)A proposed investment company shall be informed within 6 months of the date of receipt of a complete application whether or not authorisation has been granted. Reasons shall be given whenever an authorisation is refused. Chapter 2 Operating conditions Application of Regulations 23 and 24 43.
(1)Regulations 23 and 24 (except Regulation 24
(2)to the extent that it relates to paragraphs 30 to 49 and 54 to 62 of Schedule 5) shall, with all necessary modifications, apply to investment companies that have not designated a management company authorised pursuant to these Regulations.
(2)For the purpose of paragraph
(1), references in regulations 23 and 24 (including Schedule 5) to “management company” mean “investment company”. Prudential rules for investment companies 44.
(1)The Bank shall draw up prudential rules which shall be observed at all times by investment companies that have not designated a management company authorised pursuant to these Regulations.
(2)In particular, the Bank, having regard also to the nature of the investment company, shall require that the company has sound administrative and accounting procedures, control and safeguard arrangements for electronic data processing and adequate internal control mechanisms including, in particular, rules for personal transactions by its employees or for the holding or management of investments in financial instruments in order to invest its initial capital and ensuring, at least, that each transaction involving the company may be reconstructed according to its origin, the parties to it, its nature, and the time and place at which it was effected and that the assets of the investment company are invested according to the instruments of incorporation and the legal provisions in force. Application of segregated liability to investment companies established as UCITS 45. Sections 256A to 256E of the Companies Act 1990 (No. 27 of 1990) shall apply to any investment company authorised pursuant to these Regulations and for this purpose the references to umbrella fund and sub-fund shall be interpreted in accordance with the provisions of these Regulations, the references to authorisation shall be read as referring to authorisation pursuant to these Regulations and the reference to the commencement date shall be read as referring to the commencement date of section 25 of the Investment Funds, Companies and Miscellaneous Provisions Act 2005 (No. 12 of 2005). Chapter 3 Obligations regarding trustee Safe-keeping of assets 46.
(1)The assets of an investment company shall be entrusted to a trustee for safe-keeping in accordance with these Regulations.
(2)A trustees liability as referred to in Regulation 52 shall not be affected by the fact that it has entrusted to a third party some or all of the assets in its safekeeping.
(3)The assets of an investment company shall belong exclusively to the investment company. The assets shall be segregated from the assets of the trustee or its agents or both and shall not be used to discharge directly or indirectly liabilities or claims against any other undertaking or entity and shall not be available for any such purpose. Obligations of trustee 47.
(1)A trustee shall— (
  1. a)ensure that the sale, issue, repurchase, redemption and cancellation of shares effected by or on behalf of an investment company are carried out in accordance with these Regulations and with its memorandum and articles, (
  2. b)ensure that the value of units is calculated in accordance with these Regulations and the investment company’s memorandum and articles, (
  3. c)carry out the instructions of the investment company unless they conflict with these Regulations or its memorandum and articles, (
  4. d)ensure that in transactions involving an investment company’s assets any consideration is remitted to it within the usual time limits, and (
  5. e)ensure that an investment company’s income is applied in accordance with these Regulations and its memorandum and articles.
(2)A trustee shall enquire into the conduct of the investment company in each annual accounting period and report thereon to the shareholders. The trustees report shall be delivered to the investment company in good time to enable it to include a copy of the report in the annual report required under Regulation 88. The report shall state whether in the trustees opinion the investment company has been managed in that period— (
  1. a)in accordance with the limitations imposed on the investment and borrowing powers of the investment company by the memorandum and articles and these Regulations, and (
  2. b)otherwise in accordance with the provisions of the memorandum and articles and these Regulations, and, if it has not been so managed, in what respects it has not been so managed and the steps which the trustee has taken in respect thereof. Exemption from requirement to have trustee 48.
(1)Authorised investment companies which market their shares exclusively through one or more stock exchanges on which their shares are admitted to official listing may, at the discretion of the Bank, be exempted from the requirement to have trustees within the meaning of these Regulations.
(2)Regulations 96, 104 and 108 shall not apply to such companies. The rules for the valuation of such companies assets shall be stated in their articles. Further exemption 49.
(1)The Bank may, at its discretion, exempt authorised investment companies which market at least 80% of their shares through one or more stock exchanges designated in their articles of association from the requirement to have trustees within the meaning of these Regulations provided that their shares are admitted to official listing on the stock exchanges of those Member States within the territories of which the shares are marketed and provided that any transactions which such a company may effect outside stock exchanges are effected at stock exchange prices only. A companys articles shall specify the stock exchange in the country of marketing, the prices on which shall determine the prices at which that company will effect any transactions outside stock exchanges in that country.
(2)In exercising this discretion, the Bank shall be satisfied that unit-holders in the investment companies referred to in paragraph
(1)have equivalent protection to that of unit-holders of UCITS which have a trustee within the meaning of these Regulations. In particular, such investment companies and the companies referred to in Regulation 48 shall— (
  1. a)state in their articles the methods of calculation of the net asset value of their units, (
  2. b)intervene on the market to prevent the stock exchange value of their units from deviating by more than 5% from their net asset value, and (
  3. c)establish the net asset values of their units and communicate them to the Bank at least twice a week and publish them at least twice a month.
(3)At least twice a month, an independent auditor, being a person empowered to audit accounts in accordance with the Companies Acts, shall ensure that the calculation of the value of the units is effected in accordance with the investment companys articles. On such occasions, the auditor shall ensure that the companys assets are invested in accordance with the provisions in these Regulations and in the company’s articles. Requirement on Bank to inform EC Commission regarding exemptions 50. The Bank shall inform the Commission of the identities of the companies benefiting from the exemptions provided for in Regulations 48 and 49. Application of Regulation 35
(1)to
(3)and
(7)51.
(1)Regulation 35
(1)to
(3)and
(7), in relation to a trustee of a unit trust or a common contractual fund, shall, with all necessary modifications, apply to a trustee to which this Part applies.
(2)The trustee shall enable the Bank to obtain, on request, all information that the trustee has obtained while discharging its duties and that is necessary for the Bank to supervise compliance of the UCITS with these Regulations.
(3)Where the management company’s home Member State is not the State and the management company proposes to act as manager to a UCITS authorised by the Bank, the trustee shall sign an agreement in writing with the management company regulating the flow of information deemed necessary to allow it to perform the functions set out in Regulations 46 to 50 and in other laws, regulations or administrative provisions which are relevant for trustees in the State. Liability of trustee 52. The trustee shall be liable to the investment company and the unit-holders for any loss suffered by them as a result of its unjustifiable failure to perform its obligations, or its improper performance of them. Company shall not act as both investment company and trustee 53.
(1)No company shall act as both an investment company and a trustee.
(2)In carrying out its role as trustee, the trustee shall act solely in the interests of the unit-holders. Articles to lay down conditions for replacement of trustee
  1. The articles of an investment company shall lay down the conditions for the replacement of the trustee and rules to ensure the protection of unit-holders in the event of such replacement. PART 7 Mergers of UCITS Interpretation — Part 7
  2. For the purpose of this Part, a UCITS shall include sub-funds thereof. Permitted mergers
  3. Subject to the conditions set out in this Part and irrespective of the manner in which UCITS are constituted under Regulation 4
(6), cross-border and domestic mergers are permitted provided they fall within the definition in Regulation 3
(1)of “merger”. Authorisation by Bank of merger 57.
(1)Where a merging UCITS is authorised by the Bank, mergers shall be subject to prior authorisation by the Bank.
(2)(
  1. a)The merging UCITS shall provide the following information (the “File”) to the Bank: (
  2. i)the common draft terms of the proposed merger (the “Terms”) duly approved by the management of the merging UCITS and the management of the receiving UCITS, as set out in Regulation 58; (
  3. ii)an up-to-date version of the prospectus and the key investor information, referred to in Regulation 98 of the receiving UCITS, if it is established in another Member State; (iii) a statement by each of the trustees of the merging UCITS and the receiving UCITS confirming that, in accordance with Regulation 59, they have verified compliance of the particulars set out in clauses (i), (
  4. vi)and (vii) of subparagraph (
  5. a)of Regulation 58
(1)with the requirements of these Regulations and the trust deed, deed of constitution or articles of their respective UCITS; and (
  1. iv)the information on the proposed merger that each of the merging UCITS and the receiving UCITS intend to provide to their respective unit-holders, referred to in Regulation 61. (
  2. b)The information required under clause (
  3. a)shall be provided in such a manner as to enable the Bank to read it in one of the State’s languages or in a language acceptable to the Bank.
(3)(
  1. a)Once the File is complete, the Bank shall immediately transmit copies of the File to the competent authority of the receiving UCITS home Member State. The Bank and the competent authority of the receiving UCITS home Member State shall consider the potential impact of the proposed merger on unit-holders of the merging and the receiving UCITS to assess whether appropriate information under clause (
  2. iv)of subparagraph (
  3. a)of paragraph
(2)is being provided to unit-holders. If the Bank considers it necessary, it may require, in writing, that the information to unit-holders of the merging UCITS be clarified. (
  1. b)Where the competent authority of the receiving UCITS home Member State consider it necessary, they may require, in writing, and no later than 15 working days of receipt of the copies of the File, that the receiving UCITS modify the information to be provided to its unit-holders. (
  2. c)In such a case, the competent authority of the receiving UCITS home Member State shall send an indication of their dissatisfaction to the Bank and inform the Bank whether they are satisfied with the modified information to be provided to the unit-holders of the receiving UCITS within 20 working days of being notified thereof.
(4)The Bank shall authorise the proposed merger if the following conditions are met: (
  1. a)the proposed merger complies with all of the requirements of this Regulation and Regulations 58 to 60; (
  2. b)the receiving UCITS has been notified, in accordance with Regulation 117, to market its units in the State and in all Member States where the merging UCITS has been notified to market its units in accordance with that Regulation; and (
  3. c)the Bank and the competent authority of the receiving UCITS home Member State are satisfied with the proposed information to be provided to unit-holders, or no indication of dissatisfaction from the competent authorities of the receiving UCITS home Member State has been received under paragraph
(3).
(5)(
  1. a)Where the Bank considers that the File is not complete, it shall request additional information within 10 working days of receiving the File. (
  2. b)The Bank shall inform the merging UCITS, within 20 working days of submission of the File, in accordance with paragraph
(2), whether or not the merger has been authorised. The Bank shall also inform the competent authority of the receiving UCITS home Member State of its decision.
(6)The Bank may allow recently authorised UCITS to derogate from Regulations 70 to 73 for 6 months following the date of their authorisation, provided they observe the principle of risk-spreading. Terms of merger 58.
(1)(
  1. a)The Bank shall require that the merging UCITS and the receiving UCITS draw up the Terms. The Terms shall set out the following particulars: (
  2. i)an identification of the type of merger and of the UCITS involved; (
  3. ii)the background to and rationale for the proposed merger; (iii) the expected impact of the proposed merger on the unit-holders of both the merging UCITS and the receiving UCITS; (
  4. iv)the criteria adopted for valuation of the assets and, where applicable, the liabilities on the date for calculating the exchange ratio as referred to in Regulation 65
(1); (
  1. v)the calculation method of the exchange ratio; (
  2. vi)the planned effective date of the merger; (vii) the rules applicable, respectively, to the transfer of assets and the exchange of units; and (viii) in the case of a merger pursuant to paragraph (
  3. b)of the definition in Regulation 3
(1)of “merger” and, where applicable, paragraph (
  1. c)of that definition, the trust deed, deed of constitution or articles of the newly constituted receiving UCITS. (
  2. b)The Bank shall not require that any additional information is included in the Terms.
(2)The merging UCITS and the receiving UCITS may decide to include further items in the Terms. Verification 59. The trustees of the merging UCITS and of the receiving UCITS shall verify the conformity of the particulars set out in clauses (i), (iv) and (vi) of subparagraph(a) of Regulation 58
(1)with the requirements of these Regulations and the trust deed, deed of constitution or articles of their respective UCITS. Validation of certain matters 60.
(1)Where the merging UCITS is authorised by the Bank, the Bank shall require either a trustee or an independent auditor, approved in accordance with Directive 2006/43/EC of the European Parliament and of the Council of 17 May 200612 on statutory audits of annual accounts and consolidated accounts, to validate the following: (a) the criteria adopted for valuation of the assets and, where applicable, the liabilities on the date for calculating the exchange ratio, as referred to in Regulation 65
(1); (
  1. b)where applicable, the cash payment per unit; and (
  2. c)the calculation method of the exchange ratio as well as the actual exchange ratio determined at the date for calculating that ratio, as referred to in Regulation 65
(1).
(2)The statutory auditor of the merging UCITS or the statutory auditor of the receiving UCITS shall be considered independent auditors for the purposes of paragraph
(1).
(3)A copy of the reports of the independent auditor, or, where applicable, the trustee shall be made available on request and free of charge to the unit-holders of both the merging UCITS and the receiving UCITS and to their respective competent authorities. Information on merger 61.
(1)(
  1. a)The merging UCITS and the receiving UCITS shall provide appropriate and accurate information on the proposed merger to their respective unit-holders so as to enable them to make an informed judgement of the impact of the proposal on their investment. (b)(
  2. i)The information to be provided to unit-holders pursuant to sub-paragraph (
  3. a)shall be written in a concise manner and in non-technical language that enables unit-holders to make an informed judgement of the impact of the proposed merger on their investment. In the case of a proposed cross-border merger, the merging UCITS and the receiving UCITS, respectively, shall explain in plain language any terms or procedures relating to the other UCITS which differ from those commonly used in the other Member State. (
  4. ii)The information to be provided to the unit-holders of the merging UCITS shall meet the needs of investors who have no prior knowledge of the features of the receiving UCITS or of the manner of its operation. It shall draw their attention to the key investor information of the receiving UCITS and emphasise the desirability of reading it. (iii) The information to be provided to the unit-holders of the receiving UCITS shall focus on the operation of the merger and its potential impact on the receiving UCITS.
(2)(
  1. a)That information shall be provided to unit-holders of the merging UCITS and of the receiving UCITS only after the Bank has authorised the proposed merger under Regulation 57. (
  2. b)It shall be provided at least 30 days before the last date for requesting repurchase or redemption or, where applicable, conversion without additional charge as set out in Regulation 63
(1).
(3)(
  1. a)The information to be provided to unit-holders of the merging UCITS and of the receiving UCITS, shall include appropriate and accurate information on the proposed merger such as to enable them to take an informed decision on the possible impact thereof on their investment and to exercise their rights under Regulations 62 and 63. (
  2. b)The information shall include the following: (
  3. i)the background to and the rationale for the proposed merger; (
  4. ii)the possible impact of the proposed merger on unit-holders, including but not limited to any material differences in respect of investment policy and strategy, costs, expected outcome, periodic reporting, possible dilution in performance, and, where relevant, a prominent warning to investors that their tax treatment may be changed following the merger; (iii) any specific rights unit-holders have in relation to the proposed merger, including but not limited to the right to obtain additional information, the right to obtain a copy of the report of the independent auditor or the trustee on request, and the right to request the repurchase or redemption or, where applicable, the conversion of their units without charge as specified in Regulation 63
(1)and the last date for exercising that right; (
  1. iv)the relevant procedural aspects and the planned effective date of the merger, and (
  2. v)a copy of the key investor information, referred to in Regulation 98, of the receiving UCITS.
(4)Where the merging UCITS or the receiving UCITS has been notified in accordance with Regulation 117, the information referred to in paragraph
(3)shall be provided to unit holders in the State in one of the State’s languages. Where notified in other Member States in accordance with Regulation 115, the information referred to in paragraph
(3)shall be provided to unit-holders in each UCITS host Member State in the official language, or one of the official languages, of the relevant UCITS host Member State.
(5)The requirements specified in Schedules 7 and 8 shall have effect for the purposes of this Regulation. Maximum percentage of votes cast to approve merger 62. In order to be approved, mergers between UCITS shall not require more than 75% of the votes actually cast by unit-holders present or represented at the general meeting of unit-holders. The Bank shall not impose more stringent presence quorum for cross-border mergers than for domestic mergers nor more stringent presence quorum for UCITS mergers than that which applies for mergers of Irish corporate entities. Purchase or redemption of units 63.
(1)Unit-holders of both the merging UCITS and the receiving UCITS shall have the right to request, without any charge other than those retained by the UCITS to meet disinvestment costs, the repurchase or redemption of their units or, where possible, to convert them into units in another UCITS with similar investment policies and managed by the same management company or by any other company with which the management company is linked by common management or control, or by a substantial direct or indirect holding. That right shall become effective from the moment that the unit-holders of the merging UCITS and those of the receiving UCITS have been informed of the proposed merger in accordance with Regulation 61 and shall cease to exist 5 working days before the date for calculating the exchange ratio referred to in Regulation 65
(1).
(2)Without prejudice to paragraph
(1), for mergers between UCITS and by way of derogation from Regulation 104
(1), the Bank may require or allow the temporary suspension of the subscription, repurchase or redemption of units provided that such suspension is justified for the protection of the unit-holders. Legal, advisory and administrative costs of merger 64. Legal, advisory or administrative costs associated with the preparation and the completion of the merger shall not be charged to the merging UCITS or the receiving UCITS, or to any of their unit-holders, except in cases where the UCITS have not designated a management company. Law applicable to merger 65.
(1)(
  1. a)For domestic mergers, the laws of the State shall determine the date on which a merger takes effect as well as the date for calculating the exchange ratio of units of the merging UCITS into units of the receiving UCITS and, where applicable, for determining the relevant net asset value for cash payments. (
  2. b)For cross-border mergers, the laws of the receiving UCITS home Member State shall determine those dates. Where the State is the receiving UCITS home Member States, the Bank shall ensure that, where applicable, those dates are after the approval of the merger by unit-holders of the receiving UCITS or the merging UCITS.
(2)The entry into effect of the merger shall be made public through all appropriate means in the manner prescribed by the laws of the receiving UCITS home Member State, and shall be notified to the competent authorities of the home Member States of the merging UCITS and the receiving UCITS.
(3)A merger which has taken effect as provided for in paragraph
(1)shall not be declared void. Consequences of different kinds of merger 66.
(1)A merger effected in accordance with paragraph (a) of the definition in Regulation 3
(1)of “merger” shall have the following consequences: (
  1. a)all the assets and liabilities of the merging UCITS are transferred to the receiving UCITS or, where applicable, to the trustee of the receiving UCITS; (
  2. b)the unit-holders of the merging UCITS become unit-holders of the receiving UCITS and, where applicable, they are entitled to a cash payment not exceeding 10 % of the net asset value of their units in the merging UCITS; and (
  3. c)the merging UCITS cease to exist on the entry into effect of the merger.
(2)A merger effected in accordance with paragraph (b) of the definition in Regulation 3
(1)of “merger” shall have the following consequences: (
  1. a)all the assets and liabilities of the merging UCITS are transferred to the newly constituted receiving UCITS or, where applicable, to the trustee of the receiving UCITS; (
  2. b)the unit-holders of the merging UCITS become unit-holders of the newly constituted receiving UCITS and, where applicable, they are entitled to a cash payment not exceeding 10 % of the net asset value of their units in the merging UCITS; and (
  3. c)the merging UCITS cease to exist on the entry into effect of the merger.
(3)A merger effected in accordance with paragraph (c) of the definition in Regulation 3
(1)of “merger” shall have the following consequences: (
  1. a)the net assets of the merging UCITS are transferred to the receiving UCITS or, where applicable, the trustee of the receiving UCITS; (
  2. b)the unit-holders of the merging UCITS become unit-holders of the receiving UCITS; and (
  3. c)the merging UCITS continues to exist until the liabilities have been discharged.
(4)(
  1. a)The management company of the receiving UCITS shall confirm to the trustee of the receiving UCITS that transfer of assets and, where applicable, liabilities is complete. (
  2. b)Where the receiving UCITS has not designated a management company, it shall give that confirmation to the trustee of the receiving UCITS. PART 8 Obligations concerning Investment Policies of UCITS Sub-funds of UCITS to be regarded as separate UCITS 67. Where a UCITS comprises 2 or more sub-funds, each sub-fund shall be regarded as a separate UCITS for the purposes of this Part. Permitted investments 68.
(1)The investments of a UCITS shall comprise only one or more of the following: (a) transferable securities and money market instruments admitted to or dealt in on a regulated market within the meaning of Regulation 3
(1)of the MIFID Regulations; (
  1. b)transferable securities and money market instruments dealt in on another regulated market in a Member State, which operates regularly and is recognised and open to the public; (
  2. c)transferable securities and money market instruments admitted to official listing on a stock exchange in a third country or dealt in on another regulated market in a third country which operates regularly and is recognised and open to the public provided that the choice of stock exchange or market has been ap

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