Sub-funds in an umbrella structure may now be named to refer solely to the name of the investment manager of that sub-fund under the provisions of the Central Bank’s Policy Update 3/2010 “Collective investment schemes: Charging of fees and expenses to capital in fixed income funds; Names of sub-funds”.
Prior to this policy update, which became effective on 1 September 2010, it was not permitted to refer solely to the name of an investment manager in the name of a collective investment scheme or in the name of a sub-fund within an umbrella fund (except where the investment manager is majority owned by the promoter, or by the parent of the promoter, of the collective investment scheme).
The Central Bank has now amended this policy in the case of umbrella funds. The sole name of an investment manager will be permitted in the title of a sub-fund where:
- 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 on the supplement cover.
This is a significant and welcome development in the context of the increasing number of third party fund platforms being established in Ireland, particularly as UCITS. Fund platforms enable promoters to allocate specific portfolios within a structure to specific managers. The managers, in turn, get to manage a product without having to be the entity to set it up. They can develop a track record in managing assets of a regulated fund and then may, in the future, decide to set up their own vehicle. This can be of particular interest to hedge fund managers looking for exposure to UCITS products and this regulatory development will now allow these managers to clearly brand their product within the platform.