Guidance in Respect of Fast Track Application Process (November 2021)

Summary

This is guidance from the Guernsey Financial Services Commission explaining its fast track licensing process for entities that will provide management services to Qualifying Investor Funds, Registered Collective Investment Schemes, or Overseas Collective Investment Schemes under the Protection of Investors (Bailiwick of Guernsey) Law, 2020. It sets out the due diligence the Guernsey licensed administrator sponsoring the application must perform and document, and the information that must accompany the application form (Form FTL or Form FTLM) so the Commission can decide within ten business days.

• Scope: Applies only to licence applications for management services to QIFs, RCIS or Overseas Collective Investment Schemes; administration, custody or other fund/non-fund activities must use the Commission's standard application process.
• Beneficial ownership disclosure: Applicants must disclose ultimate beneficial owners, providing OPQs for holders of 15% or more and name/address details for holders of 5% to less than 15%, plus group structure diagrams where relevant.
• Fitness and propriety due diligence: The Guernsey licensed administrator must assess and document that beneficial owners, controllers and defined individuals meet the Minimum Criteria for Licensing (integrity, solvency, competence) under Schedule 4 of the POI Law.
• Verification checks: Administrators must verify regulatory status, employment history, professional qualifications and track record (at least 2 years) with independent sources, and confirm solvency (audited financials typically covering at least 3 years plus current management accounts).
• Application package: Applications must include a signed Form RA/1, completed OPQs and Online Appointments, declarations of due diligence, evidence of incorporation and paid up share capital, the administrator's due diligence file, and payment of the application fee.
• Escalation of concerns: Where uncertainty exists about the materiality of an issue affecting a beneficial owner, controller or associated party, the administrator must consult the Authorisations and Innovation Division before submitting the formal application, and must not submit until the issue is resolved and cleared in writing.
• Ongoing monitoring: After a licence is granted, the administrator must keep due diligence on the licensee and its beneficial owners/controllers updated on a regular basis and consult the Commission if new issues arise.

The Commission will formally consider a complete application within ten business days of receipt; if issues arise, that clock is suspended rather than restarted. Licensees issued under this regime remain liable for standard regulatory fees, and the Commission may take action against, or exclude from the fast track regime, an administrator whose declarations prove defective or misleading.

Key obligations

• The Guernsey licensed administrator must perform and document due diligence confirming that beneficial owners, controllers and defined individuals of the applicant are fit and proper and meet Schedule 4 minimum criteria under the POI Law.
• The administrator must obtain OPQs for beneficial owners/controllers with an interest of 15% or greater and name/address details for those with 5% up to 15%.
• The administrator must verify regulatory status, employment history, professional qualifications and track record information using independent/public sources before submission.
• The administrator must confirm solvency of beneficial owners and controllers, including obtaining audited financial statements (generally covering at least three years) and current management accounts.
• A complete, signed Form RA/1 with all supporting OPQs, Online Appointments and documentation must be submitted with the application.
• Where uncertainty exists about the materiality of an issue affecting a beneficial owner, controller or associated party, the administrator must consult the Authorisations and Innovation Division and obtain written clearance before submitting the formal application.
• The administrator must submit a declaration confirming sufficient due diligence has been performed and that the application (including Form RA/1) is complete and accurate.
• The application must be accompanied by payment of the applicable fee and evidence of incorporation/establishment and paid up share capital.
• Following licensing, the administrator must keep due diligence on the licensee and its beneficial owners/controllers updated on a regular basis and report emerging concerns to the Commission.

Applies to

Guernsey licensed administrators, applicants for licences to provide management services to Qualifying Investor Funds, applicants for licences to provide management services to Registered Collective Investment Schemes, applicants for licences to provide management services to Overseas Collective Investment Schemes, beneficial owners and controllers of such applicants

Deadlines

• within ten business days of receipt: The Commission will formally consider and decide on a complete fast track licence application within ten business days of receiving the required information, documentation and declarations; this period is suspended (not restarted) if issues are referred back to the administrator.