A recent part of the effort to promote the funds industry is the new listed fund regime, introduced by the Jersey Financial Services Commission (JFSC) with effect from 9 January, 2007. This new regime follows on from the very successful expert fund and non-domiciled funds regimes and should contribute to a period of continued and accelerated growth in the
The main advantage of the new listed fund regime is that it provides a streamlined process for the authorisation by the JFSC of qualifying listed funds. There is a ‘self-certification’ process for compliance with the JFSC’s policy requirements, which is similar to the expert fund regime. Because of this, listed funds should be able to be authorised by the JFSC within three business days of receipt of duly completed documentation.
However, unlike an expert fund, a listed fund is not restricted to ‘expert investors’. There are no qualification criteria to be an investor in a listed fund (beyond any required by the relevant stock exchange or market) and a listed fund’s securities will be freely transferable through the relevant stock exchange or market.
In terms of Jersey requirements, a listed fund must be a Jersey company and is therefore subject to the Companies (
A listed fund must have a Jersey-based monitoring functionary with two
The investment manager does not have to be Jersey-based but must:
- have appropriate experience;
- be of good standing;
- be established in an member state of the Organisation for Economic Co-operation and Development, or in a jurisdiction with which the JFSC has a memorandum of understanding;
- be regulated in that state or jurisdiction; and
- comply with certain minimum standards of corporate governance.
A listed fund must also be closed-ended i.e. it cannot permit redemptions at the option of investors. However, securities will be freely transferable through the relevant stock exchange or market.
The JFSC and the funds industry in
Consultation on further enhancement to the expert fund regime has been ongoing. The JFSC has recently issued amendments to the Expert Fund Guide designed to bring further clarity and robustness to the expert fund regime.
The intention is also to consolidate
The next step beyond the expert fund regime is the introduction of the super-expert fund regime targeted specifically at hedge funds. Serious consideration is being given by the
These proposals are in their early stages and are subject to discussion, consultation and regulatory approval, but the broad plan is to introduce a fast-track self-certification regime, like the expert fund regime. It would allow the rapid establishment of hedge funds in Jersey with the greatest amount of operational flexibility, such as the ability to appoint an administrator based outside
It is hoped these initiatives will provide continued impetus for
Martin Paul is a partner and Bernard Woo a lawyer at Bedell Cristin in
