Certified Funds Code of Practice - Schedule 5 (Jersey Eligible Investor Fund Guide)

Summary

This is Schedule 5 to the Certified Funds Code of Practice, a JFSC guide defining the Jersey Eligible Investor Fund (JEIF) structure and the streamlined authorisation process available for it. It sets out who qualifies as an Eligible Investor, the structural and governance features a JEIF should have, offer document content expectations, and the steps needed to obtain authorisation.

• Eligible Investor restriction: Units may only be acquired by Eligible Investors (as defined in Schedule 2 of the CFPO) who sign a risk-acceptance declaration given to the certificate holder before completion of subscription, purchase or exchange.
• Stock exchange trading: If units trade on an exchange, no market makers may be appointed, transfers must be restricted so only Eligible Investors can acquire units, and purchasers must sign the same risk declaration.
• Non-eligible underlying investors: An investment manager acquiring units on behalf of non-Eligible Investors must additionally declare the investment is suitable and that those investors can bear the economic risk, including total loss.
• Jersey governance requirements: A JEIF fund company, limited partnership general partner, or unit trust trustee must generally have at least two Jersey-resident directors with appropriate experience, retaining ultimate, non-delegable responsibility for management and control.
• Investment Manager good standing: The Investment Manager (and its Principal Persons) must meet good-standing criteria: no regulatory sanctions or relevant convictions in the past five years, solvency, and establishment in an OECD state or a jurisdiction with an applicable JFSC MoU.
• Confirmation and due diligence: The Investment Manager must confirm compliance with the good-standing criteria in writing to the JFSC, countersigned by the administrator, Manager or trustee after their own due diligence; supporting documents must be retained in Jersey and made available to the JFSC on request.
• Ongoing reporting duty: The administrator, Manager or trustee must notify the JFSC of any matter casting doubt on the Investment Manager's good standing, even where no formal sanction resulted.
• Authorisation process: To authorise a JEIF, the administrator, Manager or trustee must submit a completed and countersigned Application Form, supporting documentation, a certificate confirming the Offer Document meets Section 3 content requirements, and Principal Person details, together with fees, before any certificate is issued.
• Umbrella and cell funds: Each additional sub-fund, incorporated cell or protected cell of an existing umbrella, incorporated cell company or protected cell company requires its own certificate application and fee before an amended certificate is issued.

The Guide is primarily a structural and eligibility framework rather than a source of periodic filing deadlines; departures from its terms can be approved by the JFSC on a case-by-case basis.

Key obligations

• Ensure units are acquired only by Eligible Investors who sign the required risk declaration before completion of subscription, purchase or exchange
• Where units trade on a stock exchange, avoid market maker appointments and restrict transfers so only Eligible Investors can acquire units through that trade
• Obtain suitability and loss-bearing declarations where an investment manager invests on behalf of non-Eligible Investors
• Appoint at least two Jersey-resident directors (or equivalent for a limited partnership/unit trust) with appropriate experience to the fund company, general partner or trustee
• Confirm in writing to the JFSC that the Investment Manager meets the good-standing requirements, countersigned by the administrator, Manager or trustee after due diligence
• Retain due diligence documents in Jersey and produce them to the JFSC upon request
• Notify the JFSC of any issue casting doubt on the Investment Manager's or its Principal Persons' good standing
• Submit a completed, countersigned Application Form with supporting documentation, an Offer Document compliance certificate, and Principal Person details, together with fees, before a certificate is issued
• Submit a separate certificate application and fee for each additional sub-fund, incorporated cell or protected cell added to an umbrella, incorporated cell company or protected cell company

Applies to

Jersey Eligible Investor Funds, collective investment funds (CIFs), Alternative Investment Funds (AIFs), fund service providers, investment managers, administrators, managers, trustees, certificate holders, distributors

Related documents

• This document is made under Collective Investment Funds (Jersey) Law 1988