NOTICE - Reclassification of Grandfathered Exempt Funds to Class A/Class B Exempt Funds (2017-09-27)

Summary

This BMA notice reminds grandfathered exempt investment funds in Bermuda that they must reclassify as either Class A Exempted Funds or Class B Exempted Funds under the Investment Funds Act 2006, as amended by the Investment Funds Amendment Act 2013. The three year grandfathering period originally set by the 2013 Amendment Act was extended by the Investment Funds Amendment Act 2016, moving the reclassification deadline to 31 October 2017.

• Background: The 2013 Amendment Act created Class A and Class B Exempted Funds and repealed the prior exemption provisions under Section 7 of the Investment Funds Act 2006, grandfathering existing exempt funds for three years.
• Extension: The 2016 Amendment Act extended the grandfathering deadline to the fourth anniversary of the 2013 Amendment Act, i.e. 31 October 2017.
• Consequence of non compliance: Funds that fail to reclassify by the deadline lose their exempted status and fall out of compliance with the Act, and the BMA will consider enforcement action against them.
• Contact: Questions about the reclassification process should be directed to Authorisations@bma.bm.

This is an informational and compliance reminder notice rather than a new rule, but it carries a firm deadline and enforcement warning for affected funds.

Key obligations

• All grandfathered exempted funds registered under the repealed Section 7 provisions of the Investment Funds Act 2006 must reclassify as either Class A Exempted Funds or Class B Exempted Funds by 31st October 2017.
• Funds with questions about the reclassification process should contact Authorisations@bma.bm.

Applies to

grandfathered exempt investment funds, Class A Exempted Funds, Class B Exempted Funds

Deadlines

• 31st October 2017: Deadline for all grandfathered exempted funds to reclassify as Class A or Class B Exempted Funds; failure results in loss of exempted status and possible enforcement action.