LR 15.4 Continuing obligations
Compliance with LR 9
A closed-ended investment fund must comply with all of the requirements of LR 9 (Continuing obligations) subject to the modifications and additional requirements set out in this section.
Investment policy
1A closed-ended investment fund must, at all times, have a published investment policy which complies with LR 15.2.7 R.
1A closed-ended investment fund should have regard to the guidance in LR 15.2.8 G at all times.
Investment activity and compliance with investment policy
A closed-ended investment fund must, at all times, invest and manage its assets:
1A closed-ended investment fund must comply with LR 15.2.3A R at all times.
1A closed-ended investment fund should have regard to the guidance in LR 15.2.4A G at all times.
Cross-holdings
A closed-ended investment fund must, when making an acquisition of a constituent investment, observe the principles relating to cross-holdings in LR 15.2.5 R.
Feeder funds
If a closed-ended investment fund principally invests its funds in the manner set out in LR 15.2.6 R1, the closed-ended investment fund must ensure that LR 15.2.6 R is complied with at all times.
11LR 15.2.6 R and LR 15.4.6 R are not intended to require the closed-ended investment fund to be able to control or direct the master fund or intermediary (as the case may be). But if the closed-ended investment fund becomes aware that the master fund or intermediary (as the case may be) is not investing or managing its investments in accordance with that rule it will need to immediately consider withdrawal of its funds from the master fund or intermediary (as the case may be) or other appropriate action so that it is no longer in breach of the rules.
Independence
LR 15.2.11 R to LR 15.2.13A R1 apply at all times to a closed-ended investment fund.
1Shareholder approval for material changes to investment policy
A closed-ended investment fund must obtain the prior approval of its shareholders1 to any material change to its published investment policy.
1In considering what is a material change to the published investment policy, the closed-ended investment fund should have regard to the cumulative effect of all the changes since its shareholders 1last had the opportunity to vote on the investment policy or, if they have never voted, since the admission to listing.
1Conversion of an existing listed class of equity securities
Further issues
- (1)
Unless authorised by its shareholders1, a closed-ended investment fund may not issue further shares of the same class as existing shares (including issues of treasury shares) for cash at a price below the net asset value per share of those shares unless they are first offered pro rata to existing holders of shares of that class.
1 - (2)
When calculating the net asset value per share, treasury shares held by the closed-ended investment fund should not be taken into account.