Fund Administration Provider Business Statement of Principles (October 2020)

Summary

This is a Statement of Principles issued by the Bermuda Monetary Authority under section 6 of the Fund Administration Provider Business Act 2019. It explains how the Authority interprets the minimum licensing criteria in Schedule 1 of the Act, the grounds for revoking or restricting a licence, and how it exercises its powers to obtain information, reports and documents from licensed Fund Administration Providers.

• Fit and proper persons: Sets out how the Authority assesses whether controllers and officers of a Fund Administration Provider are fit and proper, including competence, diligence and probity.
• Prudent conduct of business: Explains the general requirement that boards, partners and senior management conduct business prudently and maintain robust controls.
• Shareholder controllers: Describes how influence and potential contagion risk from shareholder controllers are assessed against the fit and proper criterion.
• Licensing decisions: Sets out considerations relevant to granting, revoking or restricting a licence, cross-referenced to the Enforcement Guide.
• Information and reporting powers: Describes the Authority's statutory powers under sections 49, 50 and 51 to require information, reports (including auditor reports) and documents, and to enter premises.

The Principles are supervisory guidance rather than standalone rules, but they reference and reinforce specific statutory obligations imposed on Fund Administration Providers under the Act, including duties to self-report issues and to certify compliance.

Key obligations

• A Fund Administration Provider must alert the Authority forthwith upon becoming aware of breaches or potential breaches of any requirement or prohibition under the Act.
• A Fund Administration Provider must alert the Authority to any proposed material change in its business.
• A Fund Administration Provider must notify the Authority immediately if it becomes aware of material concerns regarding the suitability of a shareholder controller.
• A Fund Administration Provider must submit a statement of compliance, signed by two directors (one of whom must be the chief executive or equivalent officer), certifying compliance with the minimum licensing criteria in Schedule 1 to the Act.
• Fund Administration Providers must submit periodic, annual and other reporting information to the Authority at intervals it determines under the Act and related regulations, rules, guidance notes or codes.
• Fund Administration Providers must conduct their business in a prudent manner as required by paragraphs 2(1) to (7) of Schedule 1 to the Act.
• Controllers and officers of a Fund Administration Provider must be, and remain, fit and proper persons for their positions at all times.

Applies to

Fund Administration Providers (fund administration provider business licensees), controllers and officers of Fund Administration Providers, shareholder controllers of Fund Administration Providers

Deadlines

• forthwith: A Fund Administration Provider must alert the Authority forthwith upon becoming aware of a breach or potential breach of a requirement or prohibition under the Act.
• immediately: A Fund Administration Provider must notify the Authority immediately of material concerns regarding the suitability of a shareholder controller.

Related documents

• This document is made under Fund Administration Provider Business Act 2019