Termination of Regulated Funds - Apr 2017 (2017-10-17)

Summary

This is a general industry notice issued by CIMA in October 2017 giving practical guidance to regulated mutual funds that want to terminate their registration or cancel their licence. It explains the documents required, timing considerations around year-end processing, and the audit requirements that must be satisfied before termination or cancellation can be completed.

Funds can either submit a full de-registration/cancellation package or, alternatively, submit only core documents to move their status from 'Active' to 'Licence under Termination (LUT)'.

• Core documents required: The original certificate of registration, a certified copy of the Operator's resolution stating the date the fund ceased or will cease carrying on business, and the prescribed surrender fee.
• Year-end penalty relief: Funds submitting packages before December 31st will not incur penalties even if processing extends past year-end, provided the effective date is in December.
• LUT-status funds: Will not be charged the half-annual fee penalty if core requirements were submitted by end of December.

The notice also reiterates that funds must be in good standing and up to date with audited financial statements to complete termination, per section 7.1 of the Cancellation Policy. Audited accounts are required from the last filed year-end to either the winding-up commencement date or final distribution date, unless an audit waiver applies. All outstanding documents and fees must be submitted within six months of the date of application. It references two other CIMA publications for further detail and provides a contact email for the Investments and Securities Division.

Key obligations

• A fund seeking to terminate registration or cancel its licence must submit the requisite documents in a timely manner to avoid delays or additional fees.
• To move to 'Licence under Termination (LUT)' status, a fund must submit the original certificate of registration, a certified copy of the Operator's resolution stating the cessation date, and the prescribed surrender fee.
• A fund must be in good standing and up to date with submission of audited financial statements to complete de-registration/licence cancellation.
• Unless an audit waiver applies, the fund must provide audited accounts from the date of the last filed financial year end to the date of commencement of winding up (if a third-party liquidator is appointed) or to the date of final distribution (if not).
• All outstanding documents and/or fees necessary to complete the de-registration/licence cancellation process must be submitted within six months of the date of the application.

Applies to

regulated mutual funds

Deadlines

• December 31st: Deadline for submitting a de-registration/cancellation package to avoid penalties even if processing is not completed within the calendar year, provided an effective December date can be achieved.
• end of December: Deadline for LUT-status funds to submit all core requirements to avoid penalty on the half-annual fee payable.
• within six (6) months of the date of the application: Deadline for submitting all outstanding documents and/or fees necessary to complete the de-registration/licence cancellation process.