2012
January
Non UCITS Guidelines
Non-UCITS Guidelines
Applications for Authorisation of Retail & Professional Investor Non
UCITS Schemes
Guidelines on completing and submitting applications
These guidelines should be read in conjunction with the Application Form.
General Provisions
1. Generally an application can only be made where the promoter is previously cleared
by the Central Bank. However, the Central Bank is prepared to accept an application
from a new promoter, where it is an OECD regulated entity, and the Central Bank has
agreed that an application from the promoter in question can be made.
2.
The Central Bank will not review the following in advance of the
authorisation/approval of the scheme/sub-fund:
 the Memorandum and Articles of Association of an Investment Company;
 the Management Agreement;
 the Administration/Transfer Agent Agreement;
 the Investment Management/Adviser Agreement; and
 the Distribution/Paying Agent/Representative Agent Agreement.
The first filing made with the Central Bank, either by or on behalf of the
promoter, should include advanced drafts of



Prospectus
Trust Deed or Custodian Agreement as applicable marked to show changes from a
recently approved Deed or Agreement (must not be marked against documents
submitted for a Qualifying Investor Fund).
The following duly completed Sections of the Application Form for
Authorisation with the supporting documentation as set out in the relevant
section of the Application Form:
SECTION 1:
Information concerning the proposed scheme
SECTION 2: Prospectus, including Appendices 1, 2 and 3 (and any other
relevant Appendix)
SECTION 4 or 5: Trust Deed/ Custodian Agreement/
SECTION 10: Prospectus Supplement and relevant Appendices (if applicable)
(Where more than one supplement is proposed, it is only
necessary to complete Section 10 once)
Applications for the approval of new sub-funds (subsequent to the authorisation
of the scheme)
(A) Launched by way of a supplement
Section 10 should be completed and submitted.
(B) Launched by way of a prospectus
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Section 10 (excluding sub-section 10.4) and Section 2 should be completed and
submitted.
A COMPLETED APPLICATION MUST BE FILED AND INCOMPLETE
APPLICATIONS WILL BE RETURNED. THE CENTRAL BANK EXPECTS
THAT DRAFT DOCUMENTS SUBMITTED ON APPLICATION WILL BE IN
SUBSTANTIALLY AGREED AND FINAL FORMAT SUBJECT ONLY TO
NON MATERIAL AMENDMENTS AND AMENDMENTS MADE IN
RESPONSE TO COMMENTS ISSUED BY THE CENTRAL BANK.
3. THE EXECUTED AND ORIGINAL DOCUMENTS LISTED ON SECTION 12
OF THE APPLICATION FORM (AUTHORISATION DAY CHECKLIST)
MUST BE FILED NO LATER THAN 12 NOON ON THE PROPOSED DATE
OF AUTHORISATION/APPROVAL together with the duly completed sections of
the Application Form not previously filed, as listed below
SECTION 3: Memorandum and Articles of Association
SECTION 6: Management Agreement
SECTION 7: Administration/Transfer Agent Agreement
SECTION 8: Investment through Subsidiaries
SECTION 9: Investment Management Agreement
SECTION 11: Distribution/Paying Agent/Representative Agent Agreement
SECTION 12: Authorisation Day Checklist
Where documentation/confirmations are not in compliance with the Central
Bank’s requirements and/or are received after the cut-off time,
authorisation/approval will not take place on that day. The offer period cannot
commence prior to the authorisation/approval of the scheme/sub-funds.
4.
Where documentation is required to be marked up, the documentation should be
marked up against a recently authorised scheme of similar type. The ‘strike-through’
method of mark up should be utilised.
5.
Requests for derogations, from certain of the Central Bank’s requirements, should be
clearly set out in the covering letter with the initial filing. The letter should set out
the relevant provision(s) of the Central Bank’s Notices, the proposed derogation and
the rationale for the request. (The rationale can be set out in a separate
memorandum.)
6.
Fact Sheets should be submitted in advance for Retail Schemes and Professional
Investor Schemes (‘PIF’s’) with complex investment policies, e.g. investment in
structured products.
7. Applications should be submitted to The Manager, Funds Authorisation and
Supervision Division, Central Bank of Ireland, Iveagh Court, Block D, Harcourt
Road, Dublin 2.
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Specific Requirements
1. The applicant or its representative must complete all sections of the application form,
unless otherwise indicated, including the penultimate column of boxes in the Sections
of the Form in which they appear (to confirm that the requirements are met). Place a
tick ‘√’ or ‘N/A’ in each box, disclosing information as indicated, e.g., the page,
paragraph, clause number, etc.
2.
Where the procedure states ‘confirm’ a ‘√’ will be taken as a confirmation.
3.
Particular attention should be paid to the disclosure of the investment policy in the
prospectus. Full disclosure is required in relation to investments proposed.
4.
The application form must be signed by a named individual on behalf of the applicant
or the applicant’s representative (e.g. legal firm).
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Section 1 – Information Regarding the Proposed scheme
1.1.1






The name of the scheme/sub-funds must not be misleading and should
reflect the investment policy of the scheme/sub-funds
The following may not be included in the name of the scheme/sub-funds:
o Offshore
o Gold
o Bank (except where the promoter is a Bank and an exemption was
applied for to Banking Supervision Department and granted)
o Guaranteed/Assured (unless a guarantee exists)
o Investment Trust
o Partners/Partnership
o Protected/Secured unless the return of subscribed capital is 100%
protected
o ‘With Profits’ if no guarantee exists
o Exchange Traded (unless the scheme will be an exchange traded
scheme)
Where the name includes initials, the application should explain the
meaning behind them.
The name should not be similar to other Irish authorised schemes.
The name/brand name of the promoter is permitted in the scheme name.
The use of certain entity names is permitted subject to the following
conditions:
1. the name of an investment manager or investment adviser, in
conjunction with the name of the promoter, provided that:
 the name of the promoter is in a more prominent position
 the role of the investment adviser is outlined in the prospectus; and
 in the case of an umbrella fund, the investment manager/investment
adviser is appointed to the fund as a whole
2. The sole name of an investment manager/sub-investment
manager provided that the investment manager/subinvestment manager is majority owned by the promoter or
by the parent of the promoter. In the case of an umbrella
fund, the investment manager/sub-investment manager
must be appointed to the fund as a whole
3. The name of a distributor, in conjunction with the name of
the promoter, provided that:
 the distributor is the sole distributor of the fund; and
 the name of the promoter is in a more prominent position
1.4
Non-UCITS

In the case of an umbrella fund the sole name of an investment manager is
permitted in the title of a sub-fund subject to the following:
 the name of the umbrella fund contains the name of the promoter; or
 the name of the umbrella fund contains the brand name of the
promoter.
In both cases, where a supplement to the prospectus is published in respect
of the sub-fund, the name of the promoter must be stated clearly in a
prominent position on the supplement cover.

The names, brand names, etc., of other entities are not permitted.

Generally, an Irish domiciled firm providing an investment business service
to the scheme must be authorised under the Investment Intermediaries Act
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1995.
1.6.1

The employer of the Money Laundering Reporting Officer should be an
entity in a FATF country, be involved in the subscription money flow chain
and meet the requirements of the Money Laundering Guidelines.
1.6.2

This Information is required for each individual sub-fund.
1.7.1

Letter of Application seeking authorisation/approval should
a) seek ‘authorisation’ of the scheme and/or ‘approval’ of sub-funds;
b) refer to the relevant legislation for the scheme; and
c) include details of any derogations being sought
In the case of Unit Trusts and CCFs, letters of application must be signed
by both the manager and the trustee.

1.8.1
Non-UCITS

A marked up prospectus (with minimal changes) is preferable, but is not
compulsory.
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Section 2 - Prospectus
2.1.10

This refers to shares/units issued by the scheme, and not its investments.
2.2

The scheme/sub-fund(s) must have clear and separate investment objective
and policy sections.
2.2.1

The Investment Objective should be clearly stated.
The description usually refers to capital or income appreciation.

2.2.2
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2.2.5
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Each scheme must set out its investment objectives and policies clearly and
comprehensively.
This should include a description of proposed
investments, where these are traded and the purpose behind the investment.
The policy description should be clear, comprehensible, accurate and
sufficient to enable investors make an informed judgement on the proposed
investment.
The investment policy section should provide appropriate disclosure if it is
intended to invest predominantly in exchanges/markets in a particular
region.
The full list of exchanges/markets may be included as a definition or in an
appendix to the prospectus.
Ensure markets/exchanges provided for in the Policy Section are provided
for in the list of markets/exchanges – otherwise investment would be
limited to 10% unlisted limit.
Ref: Guidance Note 1/96 (as amended)
Each of the stock exchanges and markets listed must meet with the
regulatory criteria.
The scheme should regularly review the stock exchanges and markets in the
list to ensure that they continue to meet with the regulatory criteria.
If the custodian cannot provide custody in accordance with NU 5 it must
consult with the management company/investment company in order that
the relevant exchanges or markets are removed from the list.
2.2.6

It should be clear from the policy section whether or not the scheme/subfund is an Emerging Markets scheme, a Sub-Investment Grade Bond
scheme, etc.
2.2.9 (d)

The extent to which the proposed scheme will invest in Russia should be
clear in the prospectus.
2.6.2

The distribution date should be within four months of the dividend
declaration date.
2.6.3

Unclaimed dividends must be paid back into the scheme/relevant sub-fund.
Six years is the minimum time limit allowed before entitlement should
lapse.
2.11

Where a scheme/management company/administrator appoints a transfer
agent details thereof are required to be inserted in the prospectus and
material provisions of the agreement disclosed.
2.12.2

The following wording is acceptable:

Transactions must be consistent with the best interests of
shareholders/unitholders.
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
Executed on best terms reasonably obtainable on an organised
exchange.
2.12.5

In some instances contracts to which the scheme/management company are
not a party may be considered material and require disclosure.
2.13.1

The annual accounting date may be a specific day, e.g. instead of 31
December each year it could be the first Wednesday in December each year
2.14.3

Historic pricing is not permitted.
2.14.8

The dates of the initial offer period may not be available at time of
application and may be inserted prior to the approval/authorisation date.
The initial offer period can not commence prior to time of
authorisation/approval

2.14.9


The following is permitted:
o A contract note will issue immediately following a trade; and
o Where this does not provide confirmation of entry on the register, a
statement of holdings will issue regularly to investors. (The Central
Bank requires that, at a minimum, this must issue monthly for daily
dealing funds. Investors may elect for less frequent statements.)
In addition, the Central Bank permits statements of holdings to issue
electronically, i.e., via email or to be made available electronically,
provided normal security features are adhered to. Shareholders must elect
for this facility and must continue to receive statements in hard copy, on
request.
2.14.10

In general bearer shares are not permitted. Whilst bearer shares are not
prohibited under collective investment scheme legislation this type of
registration will not meet with anti money laundering requirements.
Accordingly, any proposal to provide for the issue of bearer shares must be
discussed in advance with the Central Bank.
2.14.15

If deferred redemptions are provided, ensure that the prospectus refers to
the percentage of shares of the scheme/sub-fund in issue or to the net asset
value of the scheme/sub-fund (and not the percentage of shares of a class or
the net asset value of a class within the scheme/sub-fund), which will be
redeemed on any one dealing day (i.e. 10%/25%).
2.15

Subscription and Redemptions instructions may be made by the following
means:
1. Original documentation;
2. Facsimile (subject to compliance with the Central Bank’s general
principles on electronic dealing facilities);
3. Telephone (subject to compliance with the Central Bank’s general
principles on telephonic dealing); and
4. Electronically and/or other means (subject to compliance with the
Central Bank’s general principles on electronic dealing facilities)
2.17

If a party to the scheme will pay third party fees and expenses out of its fee
then this should be clearly disclosed. Alternatively, if this party will pay
fees to a third party and subsequently be reimbursed by the scheme, the
amount of those fees should be disclosed.
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2.17.2(b)

If ‘value’, ‘gross asset value’, ‘gross proceeds’ are referred to ensure these
are defined terms.
2.17.3

Distribution fees and charges usually do not fall within the cap.
2.17.9

The Custodian to the scheme must agree with the decision taken by the
directors/management company to charge the expenses to capital and this
agreement must be evidenced.
2.17.9(a)

In the case of open-ended distributing retail schemes investing
predominantly in debt markets, expenses, including any borrowing
expenses, should be charged to income. In the event that no income has
accrued during the accounting period a relevant note should be included in
the accounts
2.17.10(a)

Retail Schemes: the two methods for calculation of performance fees set
out in this section are currently the only two methods permitted. A
proposal to adopt a different methodology must be submitted for
consideration in advance of the application for authorisation.
2.17.10

If the performance fee is complex and/or atypical a simple worked example
should be submitted with the application. In any event, the Central Bank
may request a worked example and/or clarification during the review of the
documentation.
In the case of multi-advisor funds, an investment manager/adviser should
only receive a performance fee if the assets for which it has responsibility
have increased in value during the period.

2.17.11(b)
Non-UCITS

The Central Bank’s position in relation to such arrangements is as follows:
Where a manager of an Irish authorised collective investment scheme, or
any of its delegates, successfully negotiates the recapture of a portion of the
commissions charged by brokers or dealers in connection with the purchase
and/or sale of securities for a scheme, the rebated commission shall be paid
to the scheme.

The Central Bank notes that certain entities, generally investment
managers, operate directed brokerage programmes on behalf of their
clients, including authorised collective investment schemes. This activity
typically appears to involve the negotiation of recaptured commissions and
monitoring of brokers to ensure that the selected brokers provide the
highest standards for execution, value added services and investment
research on behalf of their clients. The Central Bank accepts that an
investment manager may be paid a fee for its services and reimbursed out
of the assets of a scheme for reasonable properly vouched costs, fees and
expenses directly incurred by the investment manager in this regard
provided that full details of the arrangements (including the services
provided) have been clearly disclosed in the scheme’s prospectus.

The scheme must be separately invoiced for these fees and expenses by the
investment manager. In addition, the board of the investment company, or
management company in the case of a unit trust scheme, must, at a
minimum, and on an annual basis, formally review these arrangements and
associated costs. Full details of the amount paid under these arrangements
must be separately disclosed in the scheme’s annual accounts.
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2.19.6

Dealing prices should be published and/or made available on the internet
2.19.6(d)

Dealing prices should be published in a publication widely available in the
jurisdiction into which the scheme is being marketed
2.20.1 &
2.20.6

All investment companies established as umbrella funds and authorised
from 30 June 2005, or before 30 June 2005 but which did not commence
trading by that date, will have segregated liability between sub-funds.

Investment companies authorised before 30 June 2005 which have as an
investment objective the employment of leverage, may not establish
additional sub-funds unless the umbrella scheme has taken measures to
apply segregated liability between sub-funds.
2.20.6 b)

If the scheme is liable as a whole the issue at 2.20.6 (iii) needs to be
addressed
2.21

An investment company may establish share classes that do not raise
capital by promoting the sale of its shares to the public (i.e. a ‘restricted
class’) provided that there are other classes within the investment company
providing for public participation. (A restricted class may be created within
an investment company, or within a sub-fund of an umbrella investment
company. A sub-fund may be restricted provided other sub-funds provide
for public participation.)
The definition of unit trust scheme in the Unit Trusts Act, 1990 (the ‘Act’)
does not lend itself to the same interpretation regarding participation by the
public. Accordingly, in the event that a unit trust scheme proposes to
establish a share class for promotion to specific categories of investor,
confirmation, from the legal adviser, must be provided with the initial filing
that the proposal to restrict the share class to (insert relevant details) is
sufficient to allow that the class provides for public participation.
Ensure that a separate pool of assets is not being maintained for each class
There should be clear and unambiguous definitions of classes and subfunds

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
2.21.1

A separate prospectus can not issue for a class, however a supplement may
be issued
2.25.5 (c)

Where the duration proposed is greater than 15 years this will be considered
by the Central Bank, i.e. it is not automatically acceptable (even where
liquidity details are inserted)
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2.1
Non-UCITS

Section 2 – Appendix 1 – Investment Policy Section,
Managed accounts are direct investments, not collective investment
schemes, and the requirements regarding direct investment should be
adhered to
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Section 2, Appendix 2 – Investment Restrictions
Section 2, Appendix 3 – Valuation Provisions
INTENTIONALLY LEFT BLANK
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Section 2, Appendix 4 – Fund of Funds Scheme
General

Managed accounts are direct investment and the requirements regarding
direct investment must be adhered to.
1.5

Investments in closed-ended collective investment schemes must comply
with the normal investment limits that are applied to transferable securities,
i.e. NU 13. (For the purposes of Guidance Note 1/01, a closed-ended CIS
is one which does not provide shareholders/unitholders with the right to
request redemption of their units on at least a monthly basis, in the case of a
retail scheme, or on at least a quarterly basis, in the case of a PIF.)
Whilst the Central Bank does not regard investment in closed-ended CIS as
acceptable investments for a fund of funds scheme an exception may be
considered where the fund of funds scheme is itself a closed-ended scheme
and where the duration of the underlying CIS is shorter than the duration of
the fund of funds scheme. Such proposals must be submitted in advance.
1.6.1

A regulated collective investment scheme is one which falls under category
1 or category 2 of Annex 1 to Guidance Note 1/01
3.1

A PIF fund of funds may invest up to 100% of NAV in unregulated
schemes subject to the 20% limit in any one scheme
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Section 2, Appendix 5 – Feeder Schemes
1.3

Investments in closed-ended collective investment schemes must comply
with the normal investment limits that are applied to transferable securities,
i.e. NU 13. (For the purposes of Guidance Note 1/01, a closed-ended CIS is
one which does not provide shareholders/unitholders with the right to
request redemption of their units on at least a monthly basis, in the case of a
retail scheme, or on at least a quarterly basis, in the case of a PIF.)
The Central Bank does not regard an investment in a closed-ended scheme
as an acceptable investment for a feeder scheme. An exception may be
considered where the feeder or fund of funds scheme is itself a closedended scheme and where the duration of the underlying CIS is shorter than
the duration of the feeder scheme. In that event the provisions for feeder
schemes will apply. Any investment in a closed-ended scheme which
involves a subscription charge must comply with paragraph 5 of
NU1/paragraph 4 of NU 22.
1.4

In the case of retail schemes, an underlying CIS is regarded as a feeder
scheme if it can itself invest more than 20% in another scheme. In the case
of professional schemes this limit is 40%.
2.1

The Central Bank may also request written confirmation from the relevant
regulator and/or manager of the underlying scheme in respect of any
representation made with respect to the underlying scheme
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Section 2, Appendix 6 – Funds of Unregulated Funds Schemes
1.2

The Central Bank does not regard investment in a closed-ended CIS as an
acceptable investment for a fund of funds scheme. An investment in a
closed ended CIS must comply with the normal investment limits which are
applied to transferable securities. If such investment is provided for,
disclose investment limits as per NU 13.
1.3

Disclose intention to invest in such CIS. Focus on typical duration of lockup periods and the amount of net assets which are likely to be invested in
this type of scheme.
Confirm that the decision to invest in CIS with lock-up periods will not
affect the redemption arrangements provided for in the prospectus.

Non-UCITS
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Section 2, Appendix 7 – Money Market Schemes
INTENTIONALLY LEFT BLANK
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Section 2, Appendix 8 – Property Scheme
1.1

No property may be purchased or contracted until this minimum amount
has been reached. In the event that the minimum viable size is not reached
within the specified period, the scheme must return any subscriptions
received to the unitholders and apply to the Central Bank for revocation of
its authorisation.
1.5

The Central Bank must be notified in advance of a valuer’s appointment
and resignation.
2.3

This restriction is effective from the date of acquisition; however, a
property whose economic viability is linked to another property is not
considered as a separate item of property for this purpose. The scheme may
derogate from this restriction for two years following the date of its launch
provided it observes the principle of risk spreading. Schemes existing prior
to August 1991, which had properties valued at more than 20 per cent of
net assets do not have to dispose of such property.

There are no restrictions on the amount of cash or short term securities
which can be held by the scheme when the purpose of such holdings is to
meet redemption requirements or where this is otherwise reasonably
necessary.
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Section 2, Appendix 9 – Futures and Options Scheme – Capital Protected
1.2

2.3/2.4

Non-UCITS
Measures undertaken for the protection of capital, particularly those dealing
with the segregation of assets, are subject to the approval of the Central
Bank. If necessary the Central Bank may relax the investment restrictions
contained in this notice in order to provide for the protection of capital.
Where the investment objective of the scheme envisages tracking the
performance of a securities index, the Central Bank may permit a
derogation from the limits in this paragraph to enable the objective to be
achieved subject to paragraph 1.2 above.
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Section 2, Appendix 10 – Leveraged Futures and Options Scheme
INTENTIONALLY LEFT BLANK
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Section 2, Appendix 11 – Venture or
Development Capital Schemes
1.0

The provisions of paragraphs 4 and 5 of NU 13 are disapplied in respect of
that proportion of net assets which is invested in venture or development
capital.
3.0

The scheme may derogate from this restriction for one year following the
date of its launch provided it observes the principle of risk spreading.
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Section 3 – Memorandum and Articles of Association
3.3.4

In general bearer shares are not permitted. Whilst bearer shares are not
prohibited under collective investment scheme legislation this type of
registration will not meet with anti money laundering requirements.
Accordingly, any proposal to provide for the issue of bearer shares must
be discussed in advance with the Central Bank.
3.4.4

Ensure that the Memorandum and Articles of Association refer to the
percentage of shares in issue in the scheme/sub-fund or to the net asset
value of the scheme/sub-fund and not to the percentage of shares in issue
of a class or the net asset value of a class within the scheme/sub-fund.
3.5.1

The issue and redemption prices should be determined with the same
frequency.
Assets must be valued as frequently as the scheme deals.

3.5.3(a)

For example, it is acceptable to state that if the closing bid price is not
available, then they may be valued at the last bid price.
3.5.9 & 3.5.10

3.5.14

The Central Bank will permit closed-ended CIS and/or PIF CIS to value
OTC derivatives on a monthly basis provided this is consistent with the
valuation policy of the CIS
Short-Term money market funds are permitted to follow an amortised
cost valuation methodology
Money market funds and non money market funds are only permitted to
follow an amortised cost valuation methodology in accordance with
Guidance Note 1/00

3.5.9(b)
3rd bullet point

A CIS which is permitted to value OTC derivatives on a monthly basis
(see preceding guideline) must carry out the independent verification at
least on a quarterly basis
3.6.1(b)

The regulatory fee is payable until authorisation of the scheme is revoked
by the Central Bank.
3.9.1

Ensure that the names of the individual stock exchanges are disclosed.
For example it is insufficient to state ‘the stock exchange in Peru’.
Stock exchanges in the European Economic Area, Australia, Canada,
Hong Kong, Japan, New Zealand, Switzerland, need not be listed
individually.

3.12.3
3.15.2(a)
Non-UCITS


The wording in the Memorandum and Articles of Association must refer
to ‘records’ and not solely to ‘books’.
The individuals/entities, conditions and requirements should be specified
in the prospectus and be consistent with NU 12.
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Section 3 – Deed of Constitution
General


In general reference to directors in this section is a reference to the
directors of the management company of the CCF
Referring to the ‘Trustee’ as ‘Custodian’ is not prohibited
3.1.5

Assets’: other defined terms can be used, e.g. ‘Property’, Investments’,
etc. However ensure the term is used consistently throughout the
document.
3.2.5

In general bearer units are not permitted. While bearer units are not
prohibited under collective investment scheme legislation this type of
registration will not meet with anti money laundering requirements.
Accordingly, any proposal to provide for the issue of bearer units must be
discussed in advance with the Central Bank.
3.3 & 3.4

Where the CCF does not market solely to pension funds, he Deed must
outline normal arrangements regarding investor protection in relation to
voting rights, meetings and transfer of units.
3.5.4

Ensure that the Deed refers to the percentage of units in issue in the
scheme/sub-fund or to the net asset value of the scheme/sub-fund and not
to the percentage of units in a class or the net asset value of a class within
the scheme/sub-fund.
3.6.1

In general the issue and redemption price should be determined with
similar frequency. Assets must be valued as frequently as the scheme
deals.
3.6.3. (a)

For example, it is acceptable to state that if the closing bid price is not
available, then they may be valued at the last bid price.
3.6.9.& 3.6.10

The Central Bank will permit closed- ended CIS and Professional Investor
CIS to value OTC derivatives on a monthly basis provided this is
consistent with the valuation policy of the CIS.
3..6.14

Short-Term money market funds are permitted to follow an amortised
cost valuation methodology.
Money-Market funds and non money-market funds are only permitted to
follow an amortised cost valuation methodology in accordance with
Guidance Note 1/00.

3.6.9.(b)

A CIS which is permitted to value OTC derivatives on a monthly basis
(see preceding guideline) must carry out the independent verification at
least on a quarterly basis.
3.8.1

Ensure that the names of the individual stock exchanges are disclosed.
For example it is insufficient to state ‘the stock exchange in Peru’.
Stock exchanges in the European Economic Area, Australia, Canada,
Hong Kong, Japan, New Zealand, Switzerland, need not be listed
individually.
A listed of the regulated derivative markets must also be included
(derivative markets in the European Economic Area need not be listed


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individually).
3.11.3

The wording in Deed must refer to ‘records’ and not solely to ‘books’
3.14

The Trustee’s duties and regulatory obligations must be provided.
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Section 4 – Trust Deed
General

Reference to directors in this section is a reference to the directors of the
management company of the unit trust
4.1.2

‘Assets’: other defined terms can be used, e.g. ‘Property’, ‘Investments’
etc. However, ensure the term is used consistently throughout the
document (i.e. investments not referred to as ‘Assets’ in one place,
‘Investments’ in another, etc.)
4.2.5

In general bearer shares are not permitted. Whilst bearer shares are not
prohibited under collective investment scheme legislation this type of
registration will not meet with anti money laundering requirements.
Accordingly, any proposal to provide for the issue of bearer shares must
be discussed in advance with the Central Bank.
4.3.4

Ensure that the Trust Deed refers to the percentage of shares in issue in
the scheme/sub-fund or to the net asset value of the scheme/sub-fund
and not to the percentage of shares in a class or the net asset value of a
class within the scheme/sub-fund.
4.4.1

The issue and redemption prices should be determined with similar
frequency
Assets must be valued as frequently as the scheme deals

4.4.3(a)

For example, it is acceptable to state that if the closing bid price is not
available, then they may be valued at the last bid price.
4.4.9 & 4.4.10

The Central Bank will permit closed-ended CIS and/or PIF CIS to value
OTC derivatives on a monthly basis provided this is consistent with the
valuation policy of the CIS.
4.4.9(b)
3rd bullet point

4.4.14

A CIS which is permitted to value OTC derivatives on a monthly basis
(as per preceding guideline) must carry out the independent verification
procedure at least on a quarterly basis
Short-Term money market funds are permitted to follow an amortised
cost valuation methodology
Money market funds and non-money market funds are only permitted to
follow an amortised cost valuation methodology in accordance with
Guidance Note 1/00

4.5.1(b)

The regulatory fee is payable until authorisation of the scheme is
revoked by the Central Bank
4.6.1

Ensure that the names of the individual stock exchanges are disclosed.
For example it is insufficient to state ‘the stock exchange in Peru’
Stock exchanges in the European Economic Area, Australia, Canada,
Hong Kong, Japan, New Zealand, Switzerland, need not be listed
individually.

4.9.3

The wording in the Trust Deed must refer to ‘records’ and not solely to
‘books’.
4.13.2 &
4.13.4

All of the circumstances under which cash/Assets can be transferred
should be set out in these clauses. The Trust Deed must not have other
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provisions permitting the transfer, delivery, etc.
4.13.6

The assets of an Irish authorised scheme must be entrusted to a Trustee
for safekeeping.
However, it is recognised that in some markets,
standard market practice may require that assets be registered in the
name of the beneficial owner due to company law or other factors.
Accordingly, the Central Bank will permit provisions in Trust Deeds for
registration of assets in the name of the scheme under the following
conditions:
The Trustee must establish
 that this is standard market practice within the market in question;
and
 that securities so registered cannot be assigned, transferred,
exchanged or delivered without the prior Central Bank of the trustee
or the trustee’s agent
and a clause to this effect must be included in the Trust Deed.
Where this provision is included in a Trust Deed, the accompanying
letter must set out the circumstances that necessitate this type of
registration procedure.

Ensure there is no provision for the registration of Assets in the name of
any other entity
4.13.7

Ensure that there is no provision permitting the Trustee to act contrary
to proper instructions
4.13.8

A Trustee may give a charge over the assets and mortgage the assets in
order to secure borrowings.
4.20.2(a)

The individuals/entities, conditions and requirements should be
specified in the prospectus and be consistent with NU 12.
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Section 5 – Custodian Agreement
5.1.8 (a)

‘Assets’: other defined terms can be used, e.g. ‘Property’, ‘Investments’
etc. However, ensure that the term is used consistently throughout the
document (i.e. investments not referred to as ‘Assets’ in one place,
‘Investments’ in another, etc.)
5.3.2 &
5.3.4

All of the circumstances under which cash/Assets can be transferred
should be set out in these clauses. The Custodian Agreement must not
have other provisions permitting the transfer, delivery, etc.
5.3.6

The assets of an Irish authorised scheme must be entrusted to a custodian
for safekeeping. However, it is recognised that in some markets, standard
market practice may require that assets be registered in the name of the
beneficial owner due to company law or other factors.
Accordingly, the Central Bank will permit provisions in the custodian
agreement for registration of assets in the name of the scheme under the
following conditions:
The custodian must establish
 that this is standard market practice within the market in question; and
 that securities so registered cannot be assigned, transferred, exchanged
or delivered without the prior Central Bank of the custodian or the
custodian’s agent
and a clause to this effect must be included in the custodian agreement.
Where this provision is included in a custodian agreement, the
accompanying letter must set out the circumstances that necessitate this
type of registration procedure.

Ensure there is no provision for the registration of Assets in the name of
any other entity.
5.3.7

Ensure that there is no provision permitting the custodian to act contrary to
proper instructions
5.3.8

A custodian may give a charge over the assets and mortgage the assets in
order to secure borrowings.
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Section 6 – Management Agreement
Section 7 – Administration/Transfer Agent Agreement
INTENTIONALLY LEFT BLANK
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Section 8 – Investment through Subsidiaries
8.1.6

Shares may not be issued to any entity other than the Irish scheme
8.1.7

The subsidiary must be under the control of the Irish scheme and thus the
subsidiary may not establish a sub-committee of its directors whereby the
directors of the Irish scheme would not form a majority thereof
8.1.8

Any proposals involving the appointment of entities directly by the
subsidiary must be discussed with the Central Bank in advance. In essence,
the subsidiary is viewed as a look-through vehicle and the Irish scheme
must have full control over its activities.
Accordingly, custody,
administration and investment management of assets routed through the
subsidiary vehicle must be effected through the scheme.
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Section 9 – Investment Management Agreement
INTENTIONALLY LEFT BLANK
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Section 10 - New Sub-fund(s)
General




10.2.2





This section should be completed where a sub-fund is being launched:
o by way of a supplement; or
o subsequent to the authorisation of the scheme (by way of a supplement
or a prospectus).
Where the sub-fund (supplement) application is part of an application for a
scheme authorisation, only sub-section 10.4 of this particular section needs
to be completed in relation to the sub-fund.
Where there is more than one sub-fund, one completed section 10 will
suffice
Section 2 should also be completed where a sub-fund is being launched by
way of a prospectus
The name of the sub-fund must not be misleading and should reflect the
investment policy of the sub-fund.
The following may not be included in the name of the sub-fund:
o Offshore
o Gold
o Bank (except where the promoter is a Bank and an exemption was
applied for to Banking Supervision Department and granted)
o Guaranteed/Assured (unless a guarantee exists)
o Investment Trust
o Partners/Partnership
o Protected/Secured unless the return of subscribed capital is 100%
protected
o ‘With Profits’ if no guarantee exists
o Exchange Traded (unless the sub-fund will be an exchange traded subfund)
Where the name includes initials, the application should explain the
meaning behind them
The name should not be similar to other Irish authorised schemes
The name/brand name of the promoter is permitted in the sub-fund name.
The use of certain entity names is permitted subject to the following
conditions:
1. The name of an investment manager or investment
adviser, in conjunction with the name of the promoter, provided that:
 the name of the promoter is in a more prominent position
 the role of the investment adviser is outlined in the prospectus
2.
The sole name of an investment manager/sub-investment
manager provided that the investment manager/subinvestment manager is majority owned by the promoter or
by the parent of the promoter.
3.
The name of a distributor, in conjunction with the name of
the promoter, provided that:
 the distributor is the sole distributor of the fund; and
 the name of the promoter is in a more prominent position
10.2.9
Non-UCITS

The names, brand names, etc., of other entities are not permitted.

All investment companies established as umbrella funds and authorised
from 30 June 2005, or before 30 June 2005 but which did not commence
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trading by that date, will have segregated liability between sub-funds.

Investment companies authorised before 30 June 2005 which have as an
investment objective the employment of leverage, may not establish
additional sub-funds unless the umbrella scheme has taken measures to
apply segregated liability between sub-funds.
10.4.5 &
10.4.6

The scheme/sub-fund(s) must have clear and separate investment objective
and policy sections.
10.4.5

The Investment Objective should be clearly stated.
The description usually refers to capital and/or income appreciation.

10.4.6

The policy description should be clear, comprehensible, accurate and
sufficient to enable investors make an informed judgement on the proposed
investment.
10.4.8

The investment policy section should provide appropriate disclosure if it is
intended to invest predominantly in exchanges/markets in a particular
region.
The full list of exchanges/markets may be included as a definition or in an
appendix to the prospectus
Ensure markets/exchanges provided for in the Policy Section are provided
for in the list of markets/exchanges – otherwise investment would be
limited to 10% unlisted limit


10.4.10

It should be clear from the prospectus whether or not the scheme/sub-fund
is an Emerging Markets scheme, a Sub-Investment Grade Bond scheme,
etc.
10.4.10 (h)

This risk warning must be included in the supplement notwithstanding that
it may be also provided for in the prospectus
10.4.12

The extent to which the proposed sub-fund will invest in Russia should be
clear in the supplement.
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Section 11 - Distribution/Paying Agent/Representative Agent Agreement
Section 12 – Authorisation Day Checklist
INTENTIONALLY LEFT BLANK
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T +353 1 224 6000
F +353 1 478 2196
www.centralbank.ie
FASD@centralbank.ie
Cúirt Uíbh Eachach, Bloc D, Bóthar Fhearchair, Baile Átha
Cliath 2, Éire
Iveagh Court, Block D, Harcourt Road, Dublin 2, Ireland