COLL 7.4 Winding up an AUT and terminating a sub-fund of an AUT

In this section, where a sub-fund of an AUT is being terminated, references to:

1. (1)

   units, are references to units of the class or classes related to the sub-fund to be terminated;

2. (2)

   a resolution or extraordinary resolution, are references to such a resolution passed at a meeting of unitholders of units of the class or classes referred to in (1);

3. (3)

   scheme property, are references to the scheme property allocated or attributable to the sub-fund to be terminated; and

4. (4)

   liabilities, are references to liabilities of the AUT allocated or attributable to the sub-fund to be terminated.

1. (1)

   Upon the happening of any of the events or dates referred to in (2) and not otherwise:

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   1. (a)

      COLL 6.2 (Dealing), COLL 6.3 (Valuation and pricing) and COLL 5 (Investment and borrowing powers) cease to apply to the AUT or to the units and scheme property in the case of a sub-fund;1

   2. (b)

      the trustee must cease to issue and cancel1 units, except in respect of the final cancellation under COLL 7.4.4 R (1) or (2);1

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   3. (c)

      the manager must cease to sell and redeem units;

   4. (d)

      the manager must cease to arrange the issue or cancellation of units under COLL 6.2.7 R (Issue and cancellation of units through an authorised fund manager), except in respect of the final cancellation under COLL 7.4.4 R (1) or (2);1

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   5. (dA)

      no transfer of a unit may be registered and no other change to the register of unitholders may be made without the approval of the person responsible for the register in accordance with COLL 6.4.4 R (1); and1

   6. (e)

      the trustee must proceed to wind up the AUT or terminate the sub-fund in accordance with COLL 7.4.4 R.

2. (1A)

   If the manager has not previously notified unitholders of the proposal to wind up the AUT or terminate the sub-fund, it must as soon as practicable after winding up or termination has commenced give written notice of the commencement of the winding up or termination to the unitholders.1

3. (2)

   The events referred to in (1) are:

   1. (a)

      the authorisation order of the AUT is revoked;

   2. (b)

      alterations to the AUT's trust deed and prospectus that will be required if the sub-fund is terminated taking effect in accordance with section 251 of the Act;

   3. (c)

      the passing of an extraordinary resolution winding up the AUT or terminating the sub-fund, provided FCA's prior consent to the resolution has been obtained by the manager or trustee;

   4. (d)

      in response to a request to the FCA by the manager or the trustee for the revocation of the authorisation order, the FCA has agreed, subject to there being no material change in any relevant factor, that, on the conclusion of the winding up of the AUT, the FCA will agree to that request;

   5. (e)

      the expiration of any period specified in the trust deed as the period at the end of which the AUT is to be wound up or the sub-fund is to terminate;

   6. (f)

      the effective date of a duly approved scheme of arrangement, which is to result in the AUT or sub-fund that is subject to the scheme of arrangement being left with no property; or

   7. (g)

      the date on which a relevant pension scheme is notified in writing by the Occupational Pensions Schemes Regulatory Authority that the scheme is no longer registered under the Welfare and Pensions Reform Act 1999 as a stakeholder pension scheme.

4. (3)

   This rule is without prejudice to COLL 7.2.1 R(Requirement) and to any order or direction made under section 257 or 258 of the Act.

1. (1)

   Where COLL 7.4.3 R (2) (f) applies, the trustee must cancel all units in issue and1 wind up the AUT or terminate the sub-fund in accordance with the approved scheme of arrangement.

2. (2)

   In any other case falling within COLL 7.4.3 R:

   1. (a)

      once the AUT falls to be wound up or sub-fund terminated, the trustee must realise the scheme property;

   2. (b)

      after paying out or retaining adequate provision for all liabilities payable and for the costs of the winding up or termination, the trustee must cancel all units in issue and1 distribute the proceeds of that realisation to the unitholders and the manager proportionately to their respective interests in the AUT or sub-fund as at the date, or the date of the relevant event referred to in COLL 7.4.3 R; and

   3. (c)

      any unclaimed net proceeds or other cash (including unclaimed distribution payments) held by the trustee after one year from the date on which they became payable must be paid by the trustee into court (or, in Scotland, as the court may direct), subject to the trustee having a right to retain any expenses properly incurred by him relating to that payment.

3. (3)

   For an AUT which is a relevant pension scheme, payments must not be made to unitholders in the AUT, the realisation proceeds having to be paid by the trustee in accordance with the trust deed.

4. (4)

   Where the trustee and one or more unitholders agree, the requirement in (2) to realise the scheme property does not apply to that part of the property proportionate to the entitlement of that or those unitholders.

5. (5)

   The trustee must1 distribute the part of the scheme property referred to in (4) in the form of property, after making adjustments or retaining provisions as appears appropriate to the trustee for ensuring that, that or those unitholders bear a proportional share of the liabilities and costs.

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6. (6)

   On completion of the winding up in respect of the events referred to in COLL 7.4.3 R (2)(c), COLL 7.4.3 R (2)(d),1 COLL 7.4.3 R (2)(e) or COLL 7.4.3 R (2) (f),1 the trustee must notify the FCA in writing and at the same time the manager or trustee must request the FCA to revoke the relevant authorisation order.

1. (1)

   For any annual or half-yearly accounting period which begins1 after commencement of the winding up or termination, the manager is not required to prepare a short report (COLL 4.5.13 R (Provision of short report)), provided that it has reasonably determined1 that the report is not required in the interests of the unitholders.

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2. (1A)

   The manager must consult the trustee before determining that a short report is not required in the interests of unitholders.1

3. (2)

   Where (1) applies, a copy of the long report must be supplied free of charge to any unitholder upon request.

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4. (2A)

   Where (1) applies, the manager must ensure that it keeps unitholders appropriately informed about the winding up or termination, including its likely duration.1

5. (2B)

   The manager must send a copy of the information required by COLL 7.4.5 R (2A) to each person who was a unitholder or the first named of joint unitholders immediately before the winding up or termination commenced, unless a final distribution has been made in accordance with COLL 7.4.4 R (2)(b).1

6. (3)

   [deleted]1

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7. (4)

   At the conclusion of the winding up or termination, the accounting period then running is regarded as the final annual accounting period.

8. (5)

   Within four1 months after the end of the final annual accounting period or the termination of the sub-fund, the annual reports of the manager and trustee must be published and sent to the FCA. 1

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9. (6)

   The manager must, on publication of the annual long report in (5), write to each person who was a unitholder or the first named of joint unitholders immediately before the commencement of winding up or termination to inform them that the annual long report is available free-of-charge on request.1