Rule on Cancellation of Licences or Certificates of Registration for Regulated Mutual Funds and Registered Private Funds - August 2022

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RULE Cancellation of Licences or Certificates of Registration for Regulated Mutual Funds and Registered Private Funds

AUGUST 2022 APPENDIX 1

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RULE Cancellation of Licences or Certificates of Registration for Regulated Mutual Funds and Private Funds

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Table of Contents

RULE Cancellation of Licences or Certificates of Registration for Regulated Mutual Funds and Private Funds

Page 4 of 7 List of Acronyms

Acronym Definition CIMA MAA Monetary Authority Act MFA Mutual Funds Act PFA Private Funds Act

RULE Cancellation of Licences or Certificates of Registration for Regulated Mutual Funds and Private Funds

Page 5 of 7 Introduction

1.1. This document establishes the Cayman Islands Monetary Authority’s (the “Authority” or “CIMA”) Rule on Cancellation of Licences or Certificates of Registration for Regulated Mutual Funds and Private Funds (hereinafter referred to as the “Rule”). The Rule should be read in conjunction with the following, where applicable:

(a) Regulatory Procedure - Cancellation of Licences or Certificates of Registration for Regulated Mutual Funds; (b) Regulatory Procedure - Cancellation of Certificates of Registration for Registered Private Funds; Regulatory Policy - Exemption from Audit Requirement for a Regulated Mutual Fund; (d) Regulatory Policy - Exemption from Audit Requirement for a Private Fund; (e) Mutual Funds Act (“MFA”); (f) Private Funds Act (“PFA”); and (g) any other relevant acts and regulatory instruments issued by the Authority from time to time.

Statement of Objectives

2.1. To set out the Authority’s Rule on the cancellation of a licence or certificate of registration for regulated mutual funds and private funds, issued pursuant to the Authority’s powers under section 34(1)(a) of the Monetary Authority Act (“MAA”), as amended from time to time.

Statutory Authority

3.1. Section 34(1)(a) of the MAA provides that:

After private sector consultation and consultation with the Minister charged with responsibility for Financial Services, the Authority may –

issue or amend rules or statements of principle or guidance concerning the conduct of licensees and their officers and employees, and any other persons to whom and to the extent that the regulatory laws may apply;

Scope of Application

4.1. This Rule applies to all Funds regulated by the Authority under the MFA or the PFA, as amended from time to time.

4.2. References to any act or regulation shall be construed as references to those provisions as amended, modified, re-enacted or replaced from time to time.

Definition

RULE Cancellation of Licences or Certificates of Registration for Regulated Mutual Funds and Private Funds

Page 6 of 7 5.1. For the purposes of this Rule, the term “Fund” means a “regulated mutual fund”1 as prescribed by the MFA or a “private fund” as prescribed by the PFA.

Rules

6.1. A Fund shall notify the Authority when the Fund intends to cease carrying on, or has ceased to carry on business as a Fund pursuant to the MFA or PFA within 21 days from the date the Fund ceases to carry on business.

6.2. For the purposes of this Rule, a Fund ceases to carry on business on the date stated in the resolution2 of the operators, shareholders or unit holders wherein it is resolved that the Fund will cease or has ceased to carry on business as a Fund in or from the Cayman Islands, unless the Authority has grounds to believe that the date the Fund has ceased to carry on business is a date other than that indicated in the resolution, or no resolution has been passed or filed with the Authority. For greater certainty, a Fund to which a liquidator has been appointed is deemed to have ceased to carry on business as at the date of the liquidator’s appointment.

6.3. A Fund that has never carried on business shall notify the Authority for the cancellation of a licence or certificate of registration within 21 days from the date of the resolution that has been passed by the operators, shareholders or unit holders wherein it is acknowledged that the Fund has never carried on business and resolved that the Fund has no intention to commence business in the future.

6.4. In order to cancel its licence or certificate of registration, a Fund shall pay the surrender fee and submit all the documentation as prescribed by the Authority in the Regulatory Procedure - Cancellation of Licences or Certificates of Registration for Regulated Mutual Funds or the Regulatory Procedure - Cancellation of Certificates of Registration for Registered Private Funds.

Enforcement

7.1. Whenever there has been a breach of the Rule, the Authority may impose penalties pursuant to section 34 of the MAA. In addition, the Authority’s policies and procedures as contained in its enforcement manual, and any other powers provided in the MFA or PFA, and the MAA will apply.

Effective Date

8.1. This Rule will come into effect on the date that it is published in the Cayman Islands Gazette.

1 For the purpose of this Rule, the term “regulated mutual fund” includes regulated EU connected funds. 2 For the purpose of this Rule, the term “resolution” refers to any resolution, determination, consent or any other constitutional document that indicates the date of cessation, or the date on which a Fund intends to cease carrying on business.

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