Foundations (Continuance) (Jersey) Regulations 2009

Summary

These Regulations, made under the Foundations (Jersey) Law 2009, set out the procedures by which a Jersey company or a foreign 'recognized entity' can continue (convert) into a Jersey foundation, and by which an existing Jersey foundation can continue as a recognized entity in another jurisdiction. They cover notice and creditor-protection requirements, the application process to the Jersey Financial Services Commission (the Commission), the registrar's role in effecting the change, and related offences.

• Companies becoming foundations: A qualified person acting for the company must publish a notice of intended incorporation in the Jersey Gazette, notify creditors owed over £5,000 and the registrar, and state whether the resulting foundation will be solvent; a 28 day objection window applies before the Commission will accept the application.
• Insolvent continuance safeguard: If the notice does not confirm solvency, an Act of the Royal Court confirming creditors are not prejudiced is required before applying, with creditors again notified and a minimum 28 day wait before the Court hears the matter.
• Recognized entities becoming foundations: Foreign bodies corporate within classes designated by the Minister follow an equivalent notice, creditor-notification, solvency-declaration and 28 day objection process before applying to the Commission.
• Foundations becoming recognized entities: A foundation may apply to the Commission for permission to establish or incorporate itself as a recognized entity abroad, subject to similar notice, creditor and solvency requirements, Commission review, and registrar notification once continuance occurs.
• Commission powers: The Commission may require security for its expenses, request further information, and refuse applications on public interest, reputation, lawfulness of objects, or naming grounds, subject to a right of appeal to the Royal Court.
• Record retention: Where a foundation continues as a recognized entity, the outgoing qualified member of the council must retain the foundation's records for 10 years after it ceases to be incorporated under the Foundations Law.
• Offences: Knowingly or recklessly providing false, misleading or deceptive information or documents to the Commission or registrar, or publishing a misleading notice, is an offence punishable by up to 2 years imprisonment and a fine; failure to notify the registrar under Regulation 31 is punishable by a level 3 fine.

The Regulations apply to qualified persons, companies, recognized entities and foundations involved in these continuance transactions, and impose procedural and disclosure obligations at each stage rather than ongoing periodic filing duties.

Key obligations

• A qualified person seeking to incorporate a company as a foundation must first publish a notice of intention in the Jersey Gazette and send copies to known creditors owed over £5,000 and to the registrar before publication
• The notice must state whether the resulting foundation would be solvent on incorporation, and must state that an aggrieved person may apply to the Royal Court within 28 days of first publication to restrain the incorporation
• If the notice does not confirm solvency, the qualified person must obtain an Act of the Royal Court confirming creditors would not be prejudiced before applying to the Commission, and the Court must not hear the application for at least 28 days after it is made
• Applications to the Commission for incorporation of a company or recognized entity as a foundation must be accompanied by the proposed charter and abridged regulations, the published fee, translations if not in English, evidence of notice compliance, and specified certificates from the qualified person
• A recognized entity seeking to become a foundation must publish a notice specifying its jurisdiction and type, notify creditors owed over £5,000 and the registrar, and observe the same 28 day objection period
• A foundation seeking to continue as a recognized entity must apply to the Commission for permission, following equivalent notice, creditor-notification and solvency-disclosure requirements
• If the Commission refuses an application, it must inform the applicant of the refusal and reasons within 28 days, and the applicant may appeal to the Royal Court within 28 days of being informed
• The qualified member of the council of a foundation that continues as a recognized entity must retain the foundation's records for 10 years after the foundation ceases to be incorporated under the Foundations Law
• Persons must not knowingly or recklessly provide false, misleading or deceptive information or documents to the Commission or registrar, or publish a misleading notice, in connection with an application under these Regulations

Applies to

companies, recognized entities, foundations, qualified persons, council members of foundations, creditors

Deadlines

• 28 days after first publication of notice: Period within which an aggrieved person may apply to the Royal Court to restrain a proposed incorporation as a foundation, or a proposed continuance of a foundation as a recognized entity
• at least 28 days after application is made: Minimum period before the Royal Court may hear an application relating to continuance as an insolvent foundation or recognized entity
• within 28 days: Time within which the Commission must inform the applicant of a refusal and its reasons
• within 28 days of being informed of refusal: Time within which the qualified person may appeal a Commission refusal to the Royal Court
• 10 years after the foundation ceased to be incorporated: Period for which the former qualified member of the council must retain the foundation's records after it continues as a recognized entity

Related documents

• This document is made under Foundations (Jersey) Law 2009
• Financial Services (Disclosure and Provision of Information) (Jersey) Regulations 2020 amends this document