DP-Proposed Enhancements to Investment Business, Investment Funds and Fund Administration Regimes (March 2018)

Summary

This is a Bermuda Monetary Authority discussion paper (March 2018) seeking industry feedback on possible future changes to the Investment Business Act 2003, the Investment Funds Act 2006, and the fund administration regime. It does not itself impose new rules; it sets out proposals the Authority is considering and invites comment before any legislative or regulatory drafting proceeds.

• Investment business: Possible new/updated investment and investment activity definitions (including virtual currencies), a separate 'managing investment funds' activity, licence classes tied to activities, tightened exempted-person definitions and monetary thresholds, an Exempted Persons Register with annual application/registration fee and annual return, revised 'carrying on business in or from Bermuda' criteria, administrative fines for late/failed filings, a broader rule-making power, and updated capital/liquidity requirements.
• Investment funds: Proposed enhancements are discussed for fund governance, disclosure and related matters (see fuller text of the paper, pages 12-18).
• Fund administration: Proposals to require timely handover of fund records to a new administrator (with a statutory timeline and enforcement powers), to expand and tighten the annual Statement of Compliance under section 47 IFA (senior management sign-off, possible audited financials, fee-based extensions, fines for late/non-filing), and to revise the minimum licensing criteria (outsourcing, record retention, risk management, business continuity).

As a discussion paper, none of these proposals are yet binding; they are subject to further consultation, potential legislative amendment, and development of supporting rules or codes. Stakeholders were asked to submit feedback to policy@bma.bm by 7 May 2018.

Applies to

investment business licensees, exempted persons under the Investment Business (Exemptions) Order 2004, investment funds (operators), fund administrators

Deadlines

• 7 May 2018: Deadline for stakeholders to submit feedback on the discussion paper to policy@bma.bm