The FR is proposing to introduce a formal procedure whereby it will revoke funds and sub-funds which are not active. A number of our clients will be affected by this change and may wish to review their intentions regarding such funds and to discuss the issues with us. You will see below that the FR will consider submissions from affected funds on a case by case basis. Please call your usual contact in the Investment Funds Unit if you wish to discuss how you might proceed regarding such funds, if you require further information or if you wish to discuss the consultation.
Funds which will be affected
Irish funds submit monthly returns to the FR which show their net asset values. From these returns, the FR will identify funds (whether single funds, umbrella funds or sub-funds) which have not launched within 12 months of authorisation or have been inactive for more than 6 months.
The FR will issue a notice of its intention to revoke authorisation to the fund and to the fund's trustee and the fund may then make a written representation to the FR. If the decision is taken to revoke authorisation, the FR will request the trustee to confirm that all fund assets have been disbursed and that the trustee is not aware of any outstanding claims or disputes with investors or creditors.
Why introduce this new procedure
The FR is concerned about the number of funds reporting nil net asset values in the monthly returns data which it collates. This affects the accuracy of FR statistics and its calculation of the industry funding levy.
Subject to company law requirements, audited termination accounts will not be required for dormant funds which have never launched. Audited termination accounts will be required for funds which have ceased to trade.
This consultation will close on 18 Sept.
Please click here to see the consultation