SUBSIDIARY LEGISLATION
Segregated Portfolio Companies Regulations, 2005 (S.I. 2005 No. 96)


188
VIRGIN ISLANDS
SEGREGATED PORTFOLIO COMPANIES REGULATIONS, 2005
ARRANGEMENT OF REGULATIONS
PART I
PRELIMINARY PROVISIONS
1. Citation.
PART II
MUTUAL FUNDS
2. Interpretation for this Part.
3. Application for approval to incorporate or register mutual fund SPC.
4. Functionaries of mutual fund SPC.
5. Audit of financial statements.
6. Creation of segregated portfolios.
7. Notification of creation of segregated portfolios.
PART III
GENERAL
8. Control over names.
9. Notification to Commission of changes in information submitted.
10. Fees.
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VIRGIN ISLANDS
STATUTORY INSTRUMENT 2005 NO. 96
BVI BUSINESS COMPANIES ACT, 2004
(No. 16 of 2004)
Segregated Portfolio Companies Regulations, 2005
[Gazetted 22nd December, 2005]
The Governor in Council, acting on the advice of the Commission and in exercise
of the powers conferred by section 159 of the BVI Business Companies Act, 2004
(No. 16 of 2004), makes the following Regulations:
PART I
PRELIMINARY PROVISIONS
1. These Regulations may be cited as the Segregated Portfolio Companies
Regulations, 2005.
PART II
MUTUAL FUNDS
2. In this Part,
“functionary”, with respect to a mutual fund, means a manager,
administrator, investment advisor, custodian or any other person
whom the Commission may by Order specify;
“mutual fund” means a company that is recognised as a professional or
private
fund, or that is registered as a public fund, under the Mutual Funds
Act, 1996;
“mutual fund SPC” means a segregated portfolio company that is a
mutual fund; and
”Mutual Funds Act” means the Mutual Funds Act, 1996.
Citation.
Interpretation for
this Part.
No. 6 of 1996
190
3. (1) An application to the Commission for approval to incorporate or
register a company as a segregated portfolio company that is, or on its
incorporation will be, a mutual fund shall include the following information:
(a) the name, or proposed name, of the company;
(b) details of the person who is, or who will be appointed as, the
administrator of the company;
(c) a list of the initial segregated portfolios that it is intended will be
created, including the name, identification or designation of each
segregated portfolio; and
(d) in respect of each of the initial segregated portfolios that it is
intended will be created, details of the functionary who will be
appointed by the company to act in respect of the portfolio.
(2) An application under sub-regulation (1) for approval to incorporate a
company as a segregated portfolio company shall be accompanied by
(a) an application under the Mutual Funds Act for the recognition of
the company as a private or professional fund or for the
registration of the company as a public fund;
(b) subject to sub-regulation (3), the documents required by the
Mutual Funds Act to accompany such an application; and
(c) a copy of the offering document for each of the initial segregated
portfolios that it is intended will be created.
(3) An application under sub-regulation (1) for approval to incorporate a
company as a segregated portfolio company shall, in place of the constitutional
document required to be submitted by the Mutual Funds Act, be accompanied by
a copy of the memorandum and articles proposed for the company.
(4) An application under sub-regulation (1) for approval to register an
existing mutual fund as a segregated portfolio company shall be in the approved
form and shall be accompanied by
(a) its memorandum and articles and the changes proposed to be
made to the memorandum and articles should its application be
approved;
(b) a statement in the approved form, signed by at least one director of
the company on behalf of the board, setting out
Application for
approval to
incorporate or
register mutual
fund SPC.
191
(i) the assets and liabilities of the company as at a date no more
than six months prior to the date of the application,
(ii) details of any transactions, events or other matters not
reflected in the statement of assets and liabilities that the
directors consider have materially affected or, prior to its
registration as a segregated portfolio company are likely to
materially affect, the assets and liabilities of the company,
(iii) the assets of the company that it is intended will be
segregated portfolio assets, specifying in respect of which
portfolio, and the assets that it is intended will be general
assets, and
(iv) how the liabilities of the company will be satisfied;
(c) a declaration in the approved form signed by at least one director
of the company on behalf of the board that
(i) resolutions of the directors have been passed approving the
registration of the company as a segregated portfolio
company,
(ii) the company is solvent and that the company and each
proposed segregated portfolio will, after the assets of the
company have been allocated to segregated portfolios, be
solvent, and
(iii) the company has given notice to members of its intention to
apply for registration as a segregated portfolio company; and
(d) a copy of the offering document for each of the initial segregated
portfolios that it is intended will be created.
4. (1) A mutual fund SPC shall at all times have one or more administrators,
managers and custodians, and may appoint one or more investment advisors.
(2) The instrument under which a functionary is appointed shall specify
(a) in respect of which segregated portfolio or portfolios the
functionary is appointed; and
(b) his responsibilities and duties in respect of each such segregated
portfolio.
Functionaries of
mutual fund
SPC.
192
5. (1) A mutual fund SPC shall have an auditor who shall be responsible for
auditing its financial statements.
(2) The audited financial statements of a mutual fund SPC shall be filed
with the Commission within 6 months of the end of its financial year.
6. (1) Subject to sub-regulation (2)
(a) a mutual fund SPC that is registered as a public fund shall not
create a segregated portfolio without the prior written approval of
the Commission; and
(b) a mutual fund SPC that is recognised as a professional or private
fund shall not create a segregated portfolio without the prior
written approval of the Commission unless each of the persons
who will be appointed by the company to act as functionaries with
respect to the segregated portfolio,
(i) are the same persons as the functionaries notified to the
Commission on the application submitted under the Mutual
Funds Act, or in any subsequent notification of change of
functionary, or
(ii) have their principal place of business in a jurisdiction that is a
recognised jurisdiction for the purposes of the Mutual Funds
Act, 1996.
(2) Sub-regulation (1) does not apply to a segregated portfolio specified in
the application as an initial segregated portfolio, provided that
(a) the offering document for the segregated portfolio is in
substantially the same form as the offering document submitted to
the Commission under regulations 3(2) or 3(4); and
(b) the functionaries appointed by the segregated portfolio company
to act with respect to the segregated portfolio are the same persons
as those specified in the application.
(3) An application for approval to create a segregated portfolio under subregulation
(1) shall be in the approved form.
7. (1) A mutual fund SPC to which regulation 6(1) does not apply shall,
within 14 days of the creation of a segregated portfolio, submit a notice to the
Commission in the approved form, containing
(a) the name of the segregated portfolio company;
Audit of
financial
statements.
Creation of
segregated
portfolios.
No. 6 of 1996
Notification of
creation of
segregated
portfolios.
193
(b) details of the segregated portfolio that has been created, including
the name, identification or designation of the portfolio;
(c) details of the functionaries who have been, or will be, appointed
by the company to act in respect of the segregated portfolio; and
(d) the date of creation of the segregated portfolio.
(2) A mutual fund shall not create a segregated portfolio unless it has
previously issued an offering document with respect to the portfolio and a copy of
the offering document shall be submitted to the Commission together with the
notice specified under sub-regulation (1).
(3) A mutual fund SPC that contravenes sub-regulations (1) or (2)
commits an offence and is liable on summary conviction to a fine of $5,000.
PART III
GENERAL
8. (1) If the Commission considers that the name, identification or
designation of a segregated portfolio is misleading or undesirable, it may by
written notice direct the segregated portfolio company to change the name of the
segregated portfolio on or before the date specified in the notice, which shall not
be less than 21 days after the date of the notice.
(2) A segregated portfolio company that fails to comply with a notice
issued by the Commission under sub-regulation (1) commits an offence and is
liable on summary conviction to a fine of $5,000.
9. (1) Subject to sub-regulation (2), a segregated portfolio company shall, by
written notice in the approved form, notify the Commission of any change in
information that it is required to submit to the Commission under these
Regulations, within 14 days of the date that the information changed.
(2) Sub-regulation (1) shall not apply to information provided to the
Commission under regulation 3(4)(b) or (c).
10. The fees and penalties specified in Schedule 1 shall be payable to the
Commission.
Control over
names.
Notification to
Commission of
changes in
information
submitted.
Fees.
194
SCHEDULE
FEES PAYABLE BY A SEGREGATED PORTFOLIO COMPANY
Fee ($)
PART I: APPLICATION FEES
1. For an application for approval to incorporate or
register a company as a mutual fund SPC under
section 135 of the Act, an application fee
comprising the total of:
In respect of the company 1,000
In respect of each segregated portfolio included
in the application 250
2. For an application for approval to create one or more
segregated portfolios under regulation 6(1)(a)
or regulation 6(1)(b)
In respect of each segregated portfolio included
in the application, an application fee of 250
3. For notification of the creation of one or more segregated
portfolios under regulation 7(1)
In respect of each segregated portfolio included
in the notification, an application fee of 250
PART II: INITIAL FEES
Subject to paragraph 8, a mutual fund SPC shall pay the
following fees:
4. Where the mutual fund is incorporated or
registered on or before 30th June in any year,
an initial fee on incorporation or registration
comprising the total of:
In respect of the company 1,000
In respect of each segregated portfolio approved 100
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5. Where the mutual fund is incorporated or
registered on or after 1st July in any year,
an initial fee on incorporation or registration
comprising the total of:
In respect of the company 500
In respect of each segregated portfolio 50
6. On approval being granted to create one or more
segregated portfolios under regulation 6(1)(a)
or regulation 6(1)(b), an initial fee in respect of
each segregated portfolio approved:
(a) where the creation of the segregated portfolio is approved
on or before 30th June 100
(b) where the creation of the segregated portfolio is approved
on or after 1st July 50
7. The total initial fees payable by a mutual fund SPC
in any year shall not exceed the sum of $10,000
PART III: ANNUAL FEES
A mutual fund SPC shall pay an annual fee on or
before 31st March of each year commencing in the
year following its incorporation or registration
comprising the total of:
In respect of the company 1,000
In respect of each segregated portfolio in existence on
31st December of the previous year 100
The total annual fee payable by a mutual fund SPC in
any year shall not exceed the sum of $10,000
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PART IV: LATE PAYMENT PENALTIES
A mutual fund SPC that fails to pay its annual fee in full
on or before 31st March in any year shall, in addition to the
annual fee, pay a penalty of $250 for each month, or part
thereof, that the fee, or any part, remains outstanding.

 

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