• The Financial Regulator (FR) will not limit the amount of assets which a QIF or PIF may allocate to a side pocket or partial suspension or partial redemption arrangement.
• QIFs and PIFs may avail of reduced redemption gate provisions or may disapply the limit on compulsory redemptions in specie.
• Non-UCITS retail funds may establish side pockets, apply reduced redemption gates, and provide for partial suspensions or the partial repayment of redemption proceeds.  In specie redemptions must comply with existing policy for retail investment funds.
• Please note that funds are likely to need to amend constitutional documentation to avail of these relaxed provisions ( as most of the regulatory restrictions are built into the constitutional documents which continue to bind the fund). Amendments may require shareholder approval in certain cases. 
• The board of directors of the  fund or management company and the trustee must provide written confirmation to the FR that the proposed action is in accordance with the fund rules and takes into account the interests of all investors.
• The FR has also outlined a number of considerations for boards of Directors to take into account in the current climate.

        Read more....

        Print friendly version