Change of Designated Person Guidance (November 2021)

Summary

This guidance from the Guernsey Financial Services Commission sets out what schemes, administrators, custodians and trustees must do when a Guernsey regulated collective investment scheme wants to change its Designated Administrator and/or Designated Custodian/Trustee. It applies to authorised and registered open-ended and closed-ended schemes under the Protection of Investors (Bailiwick of Guernsey) Law, 2020, including Qualifying Investor Funds, Registered Collective Investment Schemes, Private Investment Funds and Guernsey Green Funds.

• No unauthorised change: A change of Designated Administrator or Designated Custodian/Trustee must not take effect unless and until the Commission has formally confirmed the new designation.
• Notification: The party specified under the applicable POI Law Rules must notify the Commission of a proposed change; a third party (e.g. a law firm) may submit the application but the required formal notifications must be included.
• Supporting information: Applications should include the effective date of change, reasons for the change, revised Scheme Particulars or an Addendum (for open-ended schemes, and for closed-ended schemes raising new money), a Novation Agreement or equivalent, and details of how/when investors will be notified (with investor approval if required by constitutive documents).
• New/unconnected designated persons: If the proposed new Designated Administrator or Custodian/Trustee is not already acting as a designated person for an authorised or registered scheme, the applicant should contact the Commission before applying to establish what extra information is needed.
• Warranties for certain schemes: For registered closed-ended/open-ended schemes and authorised Qualifying Investor Funds, the proposed new Designated Administrator must provide a signed letter with specified warranties (fit and proper due diligence on promoters, adequacy of disclosures, completeness of information, and awareness of offences for false or misleading information); PIFs and Guernsey Green Funds should contact the Commission early to determine the applicable warranties.
• Interim responsibility: Until the Commission confirms the new designation, the current Designated Administrator/Custodian/Trustee remains formally responsible, and the incoming party must not act, or hold itself out as acting, in that capacity.

The Commission aims to review a change request and respond within ten business days of receipt, though this timeframe is indicative only and any response may be a request for further information rather than formal confirmation.

Key obligations

• A change of Designated Administrator and/or Designated Custodian/Trustee must not take effect until the Commission has formally confirmed the new designation.
• The party specified under the applicable POI Law Rules must formally notify the Commission of a proposed change of Designated Person.
• Applicants must supply the effective date, reasons for the change, revised Scheme Particulars or Addendum (where applicable), a Novation Agreement or equivalent, and details of investor notification (and approval if required).
• If the proposed new Designated Person is not already an existing designated person for an authorised/registered scheme, the applicant must contact the Commission before applying to determine additional requirements.
• For registered collective investment schemes and Qualifying Investor Funds, the proposed new Designated Administrator must provide a signed letter containing the specified warranties.
• PIFs and Guernsey Green Funds changing Designated Administrator must contact the Commission at an early stage to determine applicable warranties/requirements.
• The current Designated Administrator/Custodian/Trustee must continue acting in that capacity, and the incoming party must not act or hold itself out as acting, until the Commission confirms the new designation.

Applies to

Guernsey regulated collective investment schemes, Designated Administrators, Designated Custodians/Trustees, Qualifying Investor Funds, Registered Collective Investment Schemes, Private Investment Funds, Guernsey Green Funds

Deadlines

• ten business days of receipt: Indicative period within which the Commission intends to review a change of Designated Person request and issue a response (not binding).