Authorised Collective Investment Schemes (Class B) Rules and Guidance, 2021

Summary

These Rules and Guidance, issued by the Guernsey Financial Services Commission under the Protection of Investors (Bailiwick of Guernsey) Law, 2020, set out the regulatory framework for Class B authorised collective investment schemes. They replace the 2013 Class B Rules and cover the full lifecycle of a scheme, from constitution and authorisation through to reporting, meetings of holders, and winding up.

• Constitution and documents: Requires unit trust schemes to be constituted by a trust instrument and limited partnership schemes by a written partnership agreement, and sets mandatory content for principal documents and scheme particulars.
• Authorisation process: Sets out the application requirements for a declaration of authorisation, including a compliance statement, copies of principal documents and scheme particulars, and the prescribed fee.
• Investment and payments: Imposes investment spreading-of-risk requirements and restricts payments out of scheme property to those authorised or properly disclosed, with notice and disclosure obligations before new charges take effect.
• Units and dealings: Governs the register of holders, certificates, suspension of dealings, transfers, and pricing controls.
• Governance and service providers: Covers the roles, appointment, replacement and retirement of the manager, designated administrator, trustee/custodian, and auditor, and management of conflicts of interest.
• Holder reporting and meetings: Sets requirements for annual and interim reports and accounts, and rules for convening and conducting meetings of holders.
• Termination and winding up: Details when and how unit trust, limited partnership, and company schemes must be wound up, including umbrella fund sub-funds.
• Scheme particulars content (Schedule 1): Prescribes detailed disclosure requirements for scheme particulars, including fees, risk warnings, tax status, valuation procedures, and directors' interests.

The Commission retains discretion to exclude or modify individual provisions and may issue supplementary (non-binding) guidance. Umbrella fund constituent parts must be activated within a set timeframe or the authorisation for that part is revoked, and new classes require separate Commission approval.

Key obligations

• A person seeking authorisation must submit the application form together with a signed compliance statement, copies of the principal documents and scheme particulars, the prescribed application fee, and clearly identify the proposed designated administrator and trustee/custodian.
• The principal documents must state the scheme's name and the applicable governing law, and (together with scheme particulars) must state investment objectives and restrictions, hedging and borrowing powers or a negative statement, and arrangements for appointment/removal of manager, trustee and auditors.
• Signed or certified copies of the principal documents and scheme particulars, and any subsequent amendments, must be filed with the Commission.
• The scheme must operate and conduct its affairs in accordance with its principal documents and scheme particulars.
• New or additional expenses, fees or charges may only be paid out of scheme property after prior notification to the trustee, sufficient notice to holders to allow redemption before the change takes effect, revision of the scheme particulars, and disclosure in the next annual or interim report.
• In an umbrella fund, expenses or fees not attributable to a single constituent part must be allocated among constituent parts in accordance with the scheme particulars.
• Any constituent part or class of an umbrella fund not activated within the specified one-year timeframe following declaration will have its authorisation revoked; new classes must be separately declared approved by the Commission.
• Scheme particulars must contain all the disclosures specified in Schedule 1, including fees, risk warnings, tax status, valuation procedures, distribution policy, and directors' interests, and must be kept up to date.

Applies to

Class B authorised collective investment schemes, unit trust schemes, limited partnership schemes, company schemes, managers, designated administrators, trustees, designated custodians, auditors, investment advisers

Deadlines

• one year after declaration: An umbrella fund's constituent part or class not activated within one year of its declaration of authorisation will be revoked.

Related documents

• This document is made under Protection of Investors (Bailiwick of Guernsey) Law, 2020
• Authorised Collective Investment Schemes (Class B) (Amendment) Rules, 2024 amends this document