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  1. Point in time
    2005-09-09

CIS 14.5 Schemes that are not commercially viable

Explanation of this section

CIS 14.5.1G
  1. (1)

    The FSA expects that the majority of requests it will receive for the winding up of an ICVC (under regulation 21(1) of the OEIC regulations) or an AUT (under section 256 of the Act) will be from authorised fund managers and depositaries who consider that the AUT or ICVC in question is no longer commercially viable.

  2. (2)

    It is in consumers' interests to minimise, as far as possible, the period between which the FSA receives such requests and responds to them. To assist the FSA in arriving at a quick decision, based on all the relevant factors, it would be helpful for the FSA to receive the information listed at CIS 14.5.2 G. Further information, however, may be requested by the FSA after receipt of the information, depending on the individual circumstances of the case.

Information to be provided to the FSA

CIS 14.5.2G

The information referred to in CIS 14.5.1 G is listed below:

  1. (1)

    name of the authorised fund;

  2. (2)

    size of the authorised fund;

  3. (3)

    number of holders;

  4. (4)

    whether dealing in units has been suspended;

  5. (5)

    why the request is being made;

  6. (6)

    what consideration has been given to the authorised fund entering into a scheme of arrangement with another authorised fund or recognised scheme and the reasons why a scheme of arrangement is not possible;

  7. (7)
    1. (a)

      whether holders have been informed of the intention to seek winding up or revocation;

    2. (b)

      if not, when they will be informed;

  8. (8)

    details of any proposed preferential switching rights offered or to be offered to holders;

  9. (9)

    details of any proposed rebate of charges to be made to holders who recently purchased units;

  10. (10)

    where the costs of winding-up will fall;

  11. (11)

    the depositary's:

    1. (a)

      statement whether having taken reasonable care it is certain that a scheme of arrangement is not practical and explain what steps have been considered that would result in the authorised fund not needing to wind up (for example appointing a replacement authorised fund manager);

    2. (b)

      confirmation that:

      1. (i)

        for an ICVC, it expects to report in the next report and accounts that the issue, sale and redemption prices, the cancellation of the ICVC'sshares and the application of the ICVC's income has been carried out in accordance with the rules in CIS, and, where applicable, the OEIC regulations and the ICVC'sinstrument of incorporation, and that the investment and borrowing powers applicable to the ICVC have not been exceeded; or

      2. (ii)

        for an AUT, it expects to report in the next report and accounts that the manager has managed the AUT in accordance with the rules in CIS, or (for a report and accounts that is unqualified) that there are no unresolved problems concerning the authorised fund that ought to be brought to the FSA's attention in connection with the possible exercise of powers under section 256 of the Act;

  12. (12)

    the preferred date for the FSA's determination to revoke authorisation or date for the winding up; and

  13. (13)

    any additional information or material considered to be relevant to the FSA's decision under section 256 of the Act or regulation 21 of the OEIC regulations (as appropriate).