Mutual Funds
The Mutual Funds Act 2004 provides for the registration or recognition and regulation of mutual funds and the licensing of managers and administrators carrying on business in or from within Anguilla. Provision is also made for unit trusts, which refer to an arrangement creating a trust under the laws of Anguilla or of any jurisdiction in which unit holders participating in the arrangement are the beneficiaries of the trust. The types of mutual funds covered by the Act are:
Private Funds
This refers to a mutual fund whose constitutional documents specify that it will have no more than 99 members. Private funds are recognised under the Act. The documents must also specify that the making of an invitation to subscribe for or purchase shares issued by the mutual fund are not offered to the public. Exemption from recognition is given to a family trust fund as defined in the Act.
There is no restriction on the amount of investment by individuals who may constitute a private fund.
Professional Funds
This refers to a mutual fund whose shares are made available only to professional investors and the initial investment in which, in respect of each of the persons constituting a majority of such investors, is not less than US$100,000 or its equivalent in any other currency. Professional funds are recognised under the Act. Professional investors are required to state in writing that they consent to being treated as a professional investor.
There is no restriction on the number of investors who may constitute a professional fund.
A mutual fund may also be recognised as a professional fund if it was carrying on business or engaged in an activity as a mutual fund on the date of the coming into force of the Act; the initial investments in respect of the majority of each of the investors in the mutual fund have been not less than US$100,000 or its equivalent in any other currency. Furthermore, the shares of the mutual fund are, after the date of the coming into force of the Act, made available only to professional investors.
Public Funds
This refers to a fund, which is neither a private nor a professional fund. A public fund has a duty to publish and file a prospectus. Public funds are registered under the Act.
Promoters of private and professional funds should apply for recognition while those dealing with public funds should apply for registration under the Act. All applications are made to the Commission using the appropriate form accompanied by a statement setting out the nature and scope of the business to be carried on by the applicant and the name of any other country or jurisdiction where the applicant is carrying on or intends to carry on business. The application fee should be paid and certified copies of the constitutional documents of the fund submitted. The address of the applicant’s place of business and address for service in Anguilla, name and address of a person resident in Anguilla who is authorized to represent the applicant and to accept service on its behalf and the address of any place (s) of business that the applicant may have outside Anguilla should also be submitted.
Applications for licensing managers and administrators must be accompanied by the application fee and include a statement of the financial, human resources and administrative facilities available to the applicant.
Public funds must maintain accounting records and prepare annual audited financial accounts for submission to the Commission. All licensees are subject to a Code of Practice governing matters relating to the conduct of business, financial resources, handling of clients money etc.
Details of application forms and fees are to be found in the Mutual Fund Regulations 2004.
The Commission has issued the following Policy Guidance papers:
The Securities Act 2001
The Eastern Caribbean Central Bank and The Eastern Caribbean Securities Regulatory Commission, both based in St Kitts, issued a Securities Act and Securities Regulations in 2001, which were passed by all eight jurisdictions within the Organisation of Eastern Caribbean States (OECS), which includes Anguilla.
The purpose of the Securities Act is to provide a full regulatory framework for all securities business either conducted within the OECS territories or with residents of OECS territories. The Act covers the requirements and rules to establish securities exchanges within member OECS jurisdictions; the licensing of the Eastern Caribbean Securities Exchange Ltd; the licensing and rules for clearing agencies and securities registries, collective investment schemes and the activities of market participants including broker/dealers; general standards of conduct governing securities business and finally the establishment, powers and duties of the Eastern Caribbean Securities Regulatory Commission. A number of Regulations have also been passed to support the Securities Act.
Further information is available from either the Eastern Caribbean Securities Regulatory Commission, St Kitts or the Financial Services Commission, Anguilla.
