Regulatory Update : Surrender of a Collective Investment Scheme authorisation or registration

The Guernsey Financial Services Commission (“GFSC”) has issued helpful guidance on when a Collective Investment Scheme (“CIS”) may surrender its authorisation or registration under Section 11 of the Protection of Investors (Bailiwick of Guernsey) Law, 2020.

*Explanatory Note for website - Surrender of fund authorisation or registration - Final revised version.pdf

The key highlights of the guidance are as follows:

• Consent is generally only given to a CIS that has completed a formal liquidation or winding up proceedings for companies or a dissolution process for limited partnerships and evidenced such.
• Consent may also be given if there has been a managed wind down and the designated administrator provides a declaration OR if a liquidation process has not completed but meets various criteria:
  • Liquidation is non-contentious or there is other evidence that the scheme is in an advanced state of managed wind-down;
  • The CIS has no regulatory issues of obligations outstanding;
  • In respect of a company, the party liquidating or conducting the managed wind-down is in good standing and has appropriate expertise;
  • The scheme no longer has the characteristics of a CIS;
  • In respect of a limited partnership, the designated administrator or general partner has confirmed that all liabilities of the CIS have been discharged and provides an explanation for retaining any assets;
  • The liquidator for a company or a POI licensed entity for a limited partnership takes formal responsibility of compliance with all AML/CFT issues of the CIS and its shareholders/partners/investors after discussion with the GFSC.
• The surrender becomes effective when written consent has been provided by the GFSC.

It is noted that the GFSC has an overarching responsibility to protect the reputation of the Bailiwick of Guernsey and the interests of the public. Where this may be in doubt, or the liabilities of the CIS have not been discharged or transferred, then consent to surrender prior to liquidation may not be given.

If you wish BDO to provide further guidance on surrendering a CIS authorisation or registration or assistance in providing liquidations, business restructuring, governance, internal audit and regulatory compliance advisory services, then please send your enquiry to advisory@bdo.gg or email your usual contact at BDO Guernsey.