Investment Funds Act No. 9 of 2021

1. Short title and commencement

2. Interpretation Part II INVESTMENT FUNDS DIVISION I PROHIBITIONS AND EXEMPTIONS OF FUND

3. Prohibition by unlicensed and unregistered funds

4. Prohibition against promotion of investment funds

5. General exemptions to promotion

6. Exemption period for registration as a professional fund DIVISION II PUBLIC FUNDS

7. Licensing of fund as public fund

8. Prohibition on invitation to public to subscribe by public fund

9. Circumstances in which invitation to subscribe not invitation to the public

10. Form and content of offering document DIVISION III PRIVATE AND PROFESSIONAL FUNDS

11. Registration of private and professional funds

12. Obligation to act in accordance with constitutional documents DIVISION IV REGISTRATION OF A FOREIGN FUND

13. Registration of a foreign fund

14. Regulations may provide for registration of foreign funds 260 Act 9 Investment Funds 2021 DIVISION V GENERAL PROVISIONS APPLICABLE TO LICENSED AND REGISTERED FUNDS

15. Restriction on licensing or registration of investment fund

16. Grant of licence or approval of registration of an investment fund

17. Restricted names

18. Transfer to another jurisdiction

19. Transfer from another jurisdiction

20. Voluntary surrender of licence by investment fund

21. Voluntary suspension of investment fund activity

22. Misrepresentation Part III SERVICE PROVIDERS DIVISION I LICENSING OF INVESTMENT FUND SERVICE PROVIDERS

23. Prohibition by service provider DIVISION II OPERATOR

24. Licensing or registration of investment operator DIVISION III INVESTMENT FUND MANAGER

25. Appointment of investment fund manager

26. Licensing, or registration of investment fund manager

27. Grant of licence or approval of registration of an investment fund manager

28. General duties of an investment fund manager

29. Minimum capital and professional indemnity insurance requirements

30. Chief Executive Officer of an investment fund manager

31. Compliance officer of an investment fund manager 2021 Investment Funds Act 9 261 DIVISION IV INVESTMENT FUND ADMINISTRATOR

32. Appointment of investment fund administrator

33. Name of investment fund administrator restricted

34. Licensing or registration of an investment fund administrator

35. Grant of licence or approval of registration of an investment fund administrator

36. Obligations of an investment fund administrator

37. Minimum capital and professional indemnity insurance requirements

38. Chief Executive Officer of an investment fund administrator

39. Compliance officer of an investment fund administrator DIVISION V CUSTODIAN

40. Appointment of custodian

41. Licensing or registration of a custodian

42. Independence of custodian

43. Segregation of investment fund assets – custodian appointed

44. Segregation of investment fund assets – exempt from appointment of custodians Part IV GENERAL REGULATORY MATTERS

45. Application for licensing or registration of licence

46. Imposition, variation or revocation of terms and conditions of licence or registration

47. Renewal of licence

48. Commission to maintain register

49. Offence Part V ADMINISTRATIVE AND FINANCIAL MATTERS

50. Due diligence by licensed service provider

51. Delegation of tasks

52. Service provider to give notice of certain matters 262 Act 9 Investment Funds 2021

53. Auditor to be appointed

54. Obligations of auditors

55. Instructions to audit accounts

56. Reporting to the Commission

57. Compliance with directions

58. Approval by the Commission

59. Initial requirements must be maintained

60. Commission to administer law Part VI MISCELLANEOUS PROVISIONS

61. General offence

62. Regulations

63. Rules

64. Winding up, dissolution and termination

65. Recognised country

66. Transitional provisions 2021 Investment Funds Act 9 263 GRENADA ACT NO. 9 OF 2021 L.S. I assent, CÉCILE E. F. LA GRENADE Governor-General. 5th August, 2021. AN ACT to provide for the regulation of investment funds and their administrators, managers and custodians, operating in or from within the Eastern Caribbean Currency Union, and for matters incidental and related thereto. [ By Notice ]. BE IT ENACTED by the Queen’s Most Excellent Majesty, by and with the advice and consent of the Senate and the House of Representatives of Grenada, and by the authority of the same as follows– Part I PRELIMINARY

1.—(1) This Act may be cited as the Short title and commencement. INVESTMENT FUNDS ACT, 2021. (2) This Act shall come into force on such date as the Minister shall appoint by Notice published in the Gazette.

2.—(1) In this Act, unless the context otherwise requires– Interpretation. 264 Act 9 Investment Funds 2021 “accredited investor” has the meaning given in the Securities Act, 2021; “affiliate” has the meaning given in the Securities Act, 2021; “applicant” means a person who makes an application under this Act; “associate” has the meaning given in the Securities Act, 2021; “approved auditor” means an auditor approved by the Commission; “closed-end investment fund” means a company, unit trust or partnership, where the holder of an equity interest does not have the option to redeem his or her equity interest or require the fund to repurchase his or her equity interest; “Commission” has the meaning given in the Securities Act, 2021; “company” includes a body corporate, limited partnership or other business entity, which is incorporated, registered or otherwise established under the laws of a member country or the laws of a foreign jurisdiction; “constitutive documents” means the principal documents governing the formation of the investment fund, and includes– (a) the trust deed in the case of a unit trust; (b) the memorandum and articles of association in the case of a company; (c) the governing regulations in the case of an investment condominium; 2021 Investment Funds Act 9 265 (d) the partnership agreement or articles of partnership in the case of a partnership; and (e) all other material agreements; “Currency Union” means the Eastern Caribbean Currency Union and refers collectively to the territories of Anguilla, Antigua and Barbuda, The Commonwealth of Dominica, Grenada, Montserrat, Saint Christopher and Nevis, Saint Lucia and Saint Vincent and the Grenadines which use the Eastern Caribbean currency as the official currency; “custodian” means a person to whom the property of the investment fund is entrusted for safekeeping; “distribution” has the meaning given in the Securities Act, 2021 and “distribute” shall be construed accordingly; “document” has the meaning given in the Securities Act, 2021; “equity interest” means a share, a trust unit, a participation interest or a partnership interest that carries an entitlement to participate in the profits or gains of the issuer thereof and that, except where the issuer is a closed-end fund, is redeemable or re-purchasable at the option of the investor; “feeder fund” means an investment fund that conducts more than 51 per cent of its investing in a master fund either directly or through an intermediary entity; “foreign investment fund” means an investment fund that is incorporated, constituted, formed or organised in a foreign jurisdiction; 266 Act 9 Investment Funds 2021 “foreign jurisdiction” means a jurisdiction outside of the Currency Union; “foreign regulatory authority” has the meaning given in the Securities Act, 2021; “generally accepted accounting principles” has the meaning given in the Securities Act, 2021; “generally accepted auditing standards” has the meaning given in the Securities Act, 2021; “independent” for the purposes of this Act, means a person which is not a subsidiary, affiliate or associate of another person or otherwise meets the conditions as prescribed by the Commission; “investment fund” or “fund” means– (a) a company which– (i) collects and pools investor funds for the purpose of collective investment; or (ii) issues equity interests that entitle the holder to receive on demand or within a specified period after demand an amount computed by reference to the value of a proportionate interest in the whole or in a part of the net assets of the company or other body, partnership or unit trust, as the case may be; or (b) a company or other body, partnership or unit trust prescribed by regulations, made by the Commission as an investment fund for the purposes of securities laws, including a closed-end fund, 2021 Investment Funds Act 9 267 but does not include any issuer of a type or description that has been prescribed as not being an investment fund; “investment fund administration” means– (a) to administer the operations and administrative affairs of an investment fund; (b) to provide the administrative services for an investment fund including the accounting, valuation or reporting services; (c) to provide the principal office of an investment fund, but does not include– (i) the provision of a registered office to an investment fund where the usual corporate secretarial and related services are provided; (ii) in relation to an investment fund, the maintenance of any register of equity interests or the registration and payment of fees; or (d) to provide investment advice or investment management or trading execution services; “investment fund administrator” means the person who provides investment fund administration; “investment fund administrator licence” means a licence or registration referred to under section 34; “investment fund adviser” means a person not being an officer or employee of an investment fund who for valuable consideration, provides or is entitled to provide an investment fund with investment advice only, and who does not provide 268 Act 9 Investment Funds 2021 any investment management services to such investment fund; “investment fund licence” means a licence or registration granted to a fund under this Act; “investment fund manager” means a person who controls or directs the assets of the investment fund or provides the investment fund with advice or information relating to investment opportunities; “investor” means a person who holds or owns an interest in or a security issued by or invested in by an investment fund; “licensed investment fund administrator” means the holder of an investment administration licence or registration; “licensee” means a person licensed under this Act; “master fund” means a company, partnership, unit trust or investment condominium that– (a) has as its investors other investment funds or feeder funds; (b) holds investments and conducts trading activities for the principal purpose of implementing the overall investment strategy of the feeder funds; and (c) has as its investors one or more feeder funds either directly or through an intermediary entity established to invest in the master fund, and for the purposes of this Act, such master fund shall be deemed to be an investment fund; 2021 Investment Funds Act 9 269 “material change” has the meaning given in the Securities Act, 2021; “Minister” means the Minister responsible for Finance; “misrepresentation” means– (a) an untrue statement of a material fact or material change; (b) an omission to state a material fact or material change that is required to be stated or is necessary to prevent a statement that is made from being false or misleading in the circumstances in which it is made; or (c) in any other circumstance, a statement about something that a reasonable investor would consider important– (i) in making a decision to trade a security; or (ii) in relation to a trading or advising relationship with a person, if the statement is untrue or omits information necessary to prevent that statement from being false or misleading in the circumstances; “Monetary Council” has the meaning given in the Securities Act, 2021; “member country” means a State or territory of a Participating Government; “offering document” in respect of an investment fund, means a document or series of documents on the basis of which– 270 Act 9 Investment Funds 2021 (a) equity interests in the investment fund are offered for sale; or (b) persons are invited to subscribe for or purchase equity interests in the investment fund, and includes a prospectus but does not include any other notice, advertisement, letter or other communication used in connection with the offer for sale of any equity interest in the investment fund or the invitation to any person to subscribe for or purchase any equity interest in the investment fund if before the offer or invitation is accepted or taken up the prospective investor is given the opportunity to consider an offering document containing the information as set out under section 10; “operator” means the person responsible for the day to day oversight of the operations of the investment fund, including the prevention of conflicts of interest, and includes– (a) where the investment fund is a unit trust, the trustee of that trust; (b) where the investment fund is a partnership, a partner in that partnership; or (c) where the investment fund is a body corporate, the directors of that body corporate; “own funds” means assets that are set aside to cover risks and includes paid-up share capital, reserves and undistributed profits; “Participating Government” means the government of the member country of the Currency Union; 2021 Investment Funds Act 9 271 “partner” means– (a) in respect of a limited partnership licensed under the applicable enactment, a partner as defined in that enactment; (b) in respect of a partnership constituted under the laws of a foreign jurisdiction, a person who would be a partner of the partnership if the partnership were constituted under the laws of the Currency Union; “partnership” means a contractual relationship which subsists between persons carrying on a business in common with a view of profit and includes a partnership formed under the laws of a member country or the laws of such other country or jurisdiction notwithstanding any statutory definition to the contrary; “party related to an investment fund” or its derivatives means an investment fund administrator, operator, promoter, custodian, valuer, investment fund manager, investment fund advisor; “person” includes an individual, a company, partnership, association and any legal entity, organised or incorporated group of persons, and the personal or other legal representative of any person to whom the context can apply; “prescribed” means prescribed by regulations or rules and “prescribe” shall be construed accordingly; “private investment fund” means a fund that– 272 Act 9 Investment Funds 2021 (a) is lawfully incorporated, constituted, formed or organised under the laws of a member country of the Currency Union or under the laws of a foreign jurisdiction; and (b) specifies in its constitutional documents that– (i) it is not authorised to have more than fifty investors; or (ii) an invitation to subscribe for, or purchase, fund interests issued by the fund shall be made on a private basis only; “professional investment fund” means an investment fund that is only offered to professional investors at the time of issue of the equity interest; “promoter” in relation to an investment fund or proposed investment fund, means any person whether within or outside the Currency Union who directly or indirectly is responsible for the formation of an investment fund and who causes the preparation or distribution of an offering document in respect of the investment fund or proposed investment fund but excludes a professional advisor or underwriter acting for or on behalf of such a person; “professional investor” means– (a) a bank or trust company licensed under the Banking Act or the Trust Act of a member country or licensed under the laws of another jurisdiction; whether acting in its individual or fiduciary capacity; 2021 Investment Funds Act 9 273 (b) a registered firm under the Securities Act, 2021 or under the laws of another jurisdiction; (c) an insurance company licensed under the Insurance Act of a member country or licensed under the laws of another jurisdiction; (d) an investment fund licensed or registered under this Act or regulated under the laws of another jurisdiction; (e) an individual whose individual net worth at the time of the purchase exceeds EC$500,000 or individual annual income has been in excess of EC$200,000 in each of the two most recent years, and has reasonable expectation of reaching the same income level in the current year; (f) an individual whose joint net worth with that individual’s spouse, at the time of the purchase exceeds EC$1,000,000 or whose joint income with that individual’s spouse has been in excess of EC$600,000 in each of the two most recent years, and has a reasonable expectation of reaching the same income level in the current year; (g) a trust with total assets in excess of EC$5,000,000; (h) an entity where all the equity owners satisfy one of the requirements in paragraphs (a) to (g); or (i) an entity with net assets in excess of EC$5,000,000; 274 Act 9 Investment Funds 2021 “public investment fund” means an investment fund that distributes its equity interests to the public in or from within the Currency Union; “record” means any means by which information may be stored; “recognised country” means a country recognised by the Commission under section 65; “register” means a register required to be maintained by the Commission under section 48; “registered foreign fund” means a foreign fund that is registered by the Commission under section 13; “registered office” means– (a) in respect of a company formed under the Companies Act, Chapter 58A, the registered office of the company for the purposes of that Act; (b) in the case of an external company registered under the Companies Act, Chapter 58A, an office registered in accordance with that Part XIX of that Act; (c) in the case of a partnership registered under the Companies Act, Chapter 58A, the registered office of that partnership for the purposes of that Act; or (d) in the case of a trust registered under the Companies Act, Chapter 58A, the place evidenced as the address of the trustees of the trust; “regulated investment fund” means an investment fund that is licensed or registered under this Act to carry on business in or from the Currency Union; 2021 Investment Funds Act 9 275 “regulated person” includes a person licensed or registered under this Act; “regulations” has the meaning given in the Securities Act, 2021; “securities laws” has the meaning given in the Securities Act, 2021; “service provider” in relation to an investment fund, means– (a) the investment fund manager, administrator, investment adviser or custodian of the fund; (b) in the case of a fund that is a unit trust, the trustee; (c) a broker-dealer acting for, or in relation to, a fund; or (d) a person undertaking such other function with respect to the fund as may be prescribed by regulations made by the Commission; “trust deed” means the written instrument establishing a trust; “trustee” in relation to a unit trust, means the person holding the property of the fund on trust for the investors; “unit trust” means a trust established by a trustee which, for valuable consideration, issues trust units in, or distributes profits or gains arising from the acquisition, holding, management or disposal of investments of the trust. (2) For the avoidance of doubt, any reference in this Act– 276 Act 9 Investment Funds 2021 (a) to “this Act” shall, unless expressly stated, include a reference to any regulations, rules, orders, notices and other subsidiary legislation made under this Act; and (b) to “securities laws” shall, unless expressly stated, include a reference to any regulations, rules, orders, notices and other subsidiary legislation made under a securities law. Part II INVESTMENT FUNDS DIVISION I PROHIBITIONS AND EXEMPTIONS OF FUND Prohibition by 3.—(1) A person shall not carry on investment fund unlicensed and unregistered business in or from within the Currency Union unless the funds. investment fund concerned is– (a) a licensed public investment fund; (b) a registered private investment fund; (c) a registered professional investment fund; or (d) a registered foreign investment fund. (2) A person shall not act as a service provider, or otherwise be concerned with the management or administration, of an investment fund that carries on business in or from within the Currency Union, unless the investment fund concerned is a licensed public fund, a licensed professional fund, a licensed private fund or a registered foreign fund. 2021 Investment Funds Act 9 277 (3) For the purposes of this section– (a) an investment fund, whether incorporated, formed or organised within the Currency Union or in a foreign jurisdiction, is deemed to carry on business in the Currency Union, if– (i) it operates from a place of business in the Currency Union; (ii) it distributes its equity interests to a person within the Currency Union or in a foreign jurisdiction; or (iii) it solicits to persons within the Currency Union or in a foreign jurisdiction; (b) an investment fund that carries on business in a foreign jurisdiction, is deemed to carry on business from within the Currency Union, if it is– (i) a company incorporated under the laws of a member country; (ii) a partnership formed under the laws of a member country; or (iii) a unit trust established and governed by the trust laws of a member country and is managed from within the Currency Union. (4) A foreign fund does not carry on business in the Currency Union as an investment fund solely by reason of the appointment of a licensee as its fund administrator, fund manager, investment advisor or custodian. 278 Act 9 Investment Funds 2021 Prohibition 4.—(1) A person, including the investment fund, shall against promotion of not, whether in or from within the Currency Union, promote investment an investment fund unless– funds. (a) the investment fund is– (i) a licensed public fund; (ii) a registered professional or private fund; or (iii) a registered foreign fund, and the fund is promoted as permitted by this Act; or (b) the communication or advice is exempted by regulations made under section 5 (2). (2) Without limiting subsection (1), a person promotes an investment fund if he or she communicates, or causes an invitation or inducement to be communicated to any other person, or advises or procures any other person, to become an investor, or to offer to become an investor, in an investment fund. General 5.—(1) An investment fund incorporated, formed or exemptions to promotion. organised in a foreign jurisdiction has not solicited an individual within the Currency Union to subscribe for, or purchase, any of its fund interests in circumstances, if the subscription or purchase is a result of an approach made by the individual to the fund without any solicitation made by or on behalf of the fund. (2) Regulations may prescribe exemptions from the application of section 4 (2) communication or advice– (a) of a specified category or description; or 2021 Investment Funds Act 9 279 (b) made or given in specified circumstances. (3) The regulations may specify circumstances in which section 3 (1) or 3 (2) does not apply with respect to certain specified categories or descriptions of investment funds or persons.

6.—(1) An investment fund may carry on business in or Exemption period for from within the Currency Union, as a professional fund, for registration as a continuous period not exceeding thirty days, without being a professional registered, if the fund– fund. (a) satisfies the criteria for a professional fund specified in section 11 (2) (a), (c) and (d); and (b) complies with, and is managed and administered in accordance with, the requirements of this Act relating to professional funds, other than with respect to registration. (2) An investment fund that commences business in reliance on subsection (1) shall submit an application to the Commission for registration as a professional fund within twenty-one business days after the commencement of its business. (3) For the purposes of this Act, a fund that commences business in reliance on subsection (1) is deemed to have been registered as a professional fund for the period in which it carries on business in reliance on subsection (1). (4) During the period in which an investment fund carries on business in accordance with subsection (1)– (a) the fund, a partner of the fund or, where the fund is a unit trust, the trustee, does not commit an offence under section 3 (1); and 280 Act 9 Investment Funds 2021 (b) a person does not commit an offence under section 3 (2) by acting as the service provider, or being concerned with the management or administration of, the fund. DIVISION II PUBLIC FUNDS Licensing of 7.—(1) An application may be made to the Commission fund as public for the licensing of an investment fund as a public fund by– fund. (a) in the case of an investment fund that is incorporated as a business company in a member country, the company itself; or (b) in the case of a unit trust, by the trustee. (2) The Commission may grant an application for licensing under subsection (1), if it is satisfied that– (a) the fund is– (i) a business company incorporated in a member country; or (ii) a unit trust that is governed by the trust laws of a member country and has a trustee that is based in the Currency Union; (b) the fund satisfies the requirements of this Act; (c) the fund will upon licensing, be in compliance with this Act; (d) the fund’s service providers satisfy the Commission’s fit and proper criteria; (e) the fund has, or upon licensing would have, an independent custodian; 2021 Investment Funds Act 9 281 (f) the fund’s name is not undesirable or misleading; and (g) it is appropriate to do so in the public interest. (3) Where the Commission grants an application for a licence under subsection (1), it shall– (a) record the public fund in the Register of Public Funds; and (b) issue a licence certificate in the approved form to a public fund. (4) The Commission may grant a public fund licence subject to such conditions as it considers appropriate.

8.—(1) A public fund shall not, whether within or outside Prohibition the Currency Union, make an invitation to the public to on invitation to public to subscribe for or purchase its fund interests, unless the subscribe by invitation– public fund. (a) is contained in an approved offering document; and (b) complies with such requirements as may be specified in regulations. (2) For the purposes of subsection (1), an invitation to more than fifty persons, in the Currency Union or in a foreign jurisdiction, to subscribe for or purchase fund interests, is an invitation to the public to subscribe for or purchase fund interests. (3) Subsection (1) does not apply to an invitation that is deemed not to be an invitation to the public under section 9. 282 Act 9 Investment Funds 2021 Circumstances 9. An invitation to a person to subscribe for or purchase in which invitation to fund interests is deemed not to constitute an invitation to the subscribe not public if– invitation to the public. (a) the invitation is made to, or is directed exclusively at, one or more of the following– (i) an accredited investor; (ii) a person having a close connection with the issuer; or (iii) a Participating Government; (b) the minimum aggregate purchase price payable by a person for the fund interests acquired by him or her pursuant to the invitation– (i) must be paid before the fund interests are issued; and (ii) equals or exceeds the minimum specified in regulations, or the equivalent in another currency; or (c) the invitation is made– (i) to such persons; (ii) with respect to fund interests issued, or to be issued, by such persons; or (iii) in such circumstances, as may be prescribed in regulations. Form and 10.—(1) An offering document intended to be submitted content of offering to the Commission for registration shall– document. 2021 Investment Funds Act 9 283 (a) be in writing, be dated and be signed by or on behalf of– (i) in the case of a business company of the Currency Union, the board of the company; or (ii) in the case of a unit trust, the fund manager or the trustee of the trust; (b) provide full and accurate disclosure of all such information as investors would reasonably require and expect to find for the purpose of making an informed investment decision; (c) be in the form, contain the information, statements, certifications and other matters specified in regulations; and (d) have attached to it such documents as may be prescribed in regulations. (2) The Commission shall issue a receipt for an offering document within thirty days after the date of the filing of the offering document that satisfies the prescribed requirements. (3) A distribution commences on the date that the receipt for the prospectus is issued. DIVISION III PRIVATE AND PROFESSIONAL FUNDS

11.—(1) An application may be made to the Commission Registration of private and for the registration of an investment fund as a private fund professional or as a professional fund by– funds. 284 Act 9 Investment Funds 2021 (a) in the case of an investment fund that is a company, the fund itself; (b) in the case of a unit trust, by the trustee; (c) in the case of an investment fund that is a partnership, by a partner; (d) in any other case, by the manager, or proposed manager of the fund. (2) The Commission may register an investment fund as a private fund or a professional fund, if it is satisfied that– (a) the fund is lawfully incorporated, constituted, formed or organised under the laws of a member country or a foreign jurisdiction; (b) in the case of a private fund, the constitutional documents of the fund specify that– (i) the fund is not authorised to have more than fifty investors; or (ii) an invitation to subscribe for, or purchase fund interests issued by the fund shall be made to not more than fifty investors; (c) in the case of a professional fund, the constitutional documents of the fund specify that– (i) the fund interests shall be issued only to professional investors; or (ii) the initial investment of each investor in the fund, other than exempted investors, shall be not less than such sum as may be prescribed in regulations; 2021 Investment Funds Act 9 285 (d) the fund satisfies such other criteria as may be specified for registration of a private or professional fund, as the case may be, in regulations; (e) the fund satisfies the requirements of this Act with respect to the application; (f) the fund would, on being registered, be in compliance with this Act; and (g) it is appropriate in the public interest to register the fund as a private or professional fund. (3) For the purposes of subsection (2) (b) (ii), an invitation to subscribe for, or purchase, fund interests issued by a private investment fund includes an invitation which is made– (a) to specified persons (however described) and is not calculated to result in fund interests becoming available to other persons or to a large number of persons; or (b) by reason of a private or business connection between the person making the invitation and the investor. (4) For the purposes of subsection (2) (c), the minimum investment limit referred to does not apply in respect of an investment made by a person specified in regulations as an exempted investor. (5) Where the Commission grants an application for registration under subsection (1), it shall– 286 Act 9 Investment Funds 2021 (a) register the fund in the Register of Private Funds or the Register of Professional Funds, as appropriate; and (b) issue the fund with a certificate of registration in the approved form. (6) The registration of a private or professional fund is subject to such conditions as may be imposed by the Commission. Obligation 12.—(1) No registered private or professional fund shall to act in accordance with make any offer or invitation of its fund interests, issue any constitutional fund interests or carry on business in any manner that would documents. result in the fund– (a) in the case of a private fund– (i) having more than fifty investors; or (ii) making any invitation to subscribe for, or purchase, its fund interests otherwise than on a private basis; or (b) in the case of a professional fund, issuing fund interests– (i) to any person who is not a professional investor; or (ii) where the initial investment, in respect of a professional investor who is not an exempted investor, is less than the sum prescribed in regulations. (2) Without limiting subsection (1), no person shall be accepted as an investor in a private or professional fund unless that person has provided– 2021 Investment Funds Act 9 287 (a) in the case of a professional fund, written confirmation that he or she is a professional investor within the meaning specified; and (b) in the case of a private or professional fund, a written acknowledgement that he or she has received, understood and accepted the prescribed investment warning. DIVISION IV REGISTRATION OF A FOREIGN FUND

13.—(1) An application may be made to the Commission Registration of a foreign fund. by a foreign fund or by its manager, for the fund to be a registered foreign fund. (2) The Commission may approve an application for the registration of a foreign fund if the Commission is satisfied that– (a) the fund complies with the requirements of this Act in respect of the application and would, upon registration, be in compliance with the requirements of this Act with respect to registered foreign funds; (b) the fund is subject to an authorisation and supervisory regime in the jurisdiction in which it is constituted that, in the opinion of the Commission, provides to investors in the Currency Union protection at least equivalent to the protection provided under this Act for investors of public funds; and 288 Act 9 Investment Funds 2021 (c) the fund is being operated and managed in compliance with the authorisation and supervisory regime to which it is subject. Regulations 14. Regulations may make provision with respect to the may provide for registration of registration of foreign funds, including as to– foreign funds. (a) the submission to the Commission and the publication of such particulars as regards registered foreign funds as may be prescribed; (b) the notifications to be provided to the Commission with respect to registered foreign funds, including as to the amendment of the constituting instruments of a registered foreign fund and changes of the service providers of a registered foreign fund; (c) the maintenance in the Currency Union of deposits and property by and with respect to registered foreign funds. DIVISION V GENERAL PROVISIONS APPLICABLE TO LICENSED AND REGISTERED FUNDS Restriction on 15. The Commission shall not license or register an licensing or registration investment fund until the Commission is satisfied that– of investment fund. (a) each promoter, operator, investment fund advisor, investment fund manager, investment fund administrator, auditor, custodian, is fit and proper; and 2021 Investment Funds Act 9 289 (b) the business of the investment fund and any offering of equity interests in it would be carried out, in accordance with this Act and any other applicable laws.

16.—(1) The Commission shall not grant a licence or Grant of approve the registration of an investment fund where– licence or approval of registration of (a) the investment fund has not satisfied the an investment provisions of this Act; fund. (b) for reasons of public interest, the Commission determines that the investment fund should not be licensed or registered; or (c) the name of the investment fund is– (i) identical to that of any other investment fund that is licensed or registered under this Act or which so nearly resembles the name of an investment fund licensed or registered under this Act so as to be likely to deceive or cause confusion in the investment funds industry; (ii) likely to suggest, falsely, the patronage of or connection with some person or authority, whether within the Currency Union or elsewhere; or (iii) likely to suggest falsely, that the fund has a special status in relation to or derived from the respective Governments of the member countries. (2) Where the Commission refuses to grant the application, the Commission shall serve a notice of its decision, in writing, on the applicant. 290 Act 9 Investment Funds 2021 Restricted 17.—(1) Unless exempted by the Commission, no person names. other than a regulated investment fund shall carry on or attempt to carry on business as an investment fund with the words “fund” or “investment fund” in its name. (2) If, in the opinion of the Commission, an investment fund is carrying on business in a name that the Commission would have refused by virtue of section 16 (1) (c), the Commission may direct the investment fund to change its name to a name approved by the Commission. Transfer 18.—(1) A regulated investment fund may transfer from to another jurisdiction. the Currency Union to a foreign jurisdiction and shall notify the Commission of such transfer in the prescribed form within fourteen days of the issue of the licence or notification of approval of registration with the foreign jurisdiction. (2) Where a notification is given under subsection (1), the investment fund shall at the same time– (a) surrender to the Commission the original certificate issued as evidence of its being licensed or registered in the Currency Union; or (b) in the event the original certificate is lost, submit to the Commission an affidavit attesting to the fact of such loss. (3) The Commission upon being satisfied that the provisions of this section have been met, shall issue a public notice that the investment fund is no longer licensed in the Currency Union by publication– (a) in the Official Gazette in each member country; 2021 Investment Funds Act 9 291 (b) in a newspaper of general circulation in each member country; and (c) on the website of the Commission.

19.—(1) An investment fund that intends to transfer to Transfer the Currency Union from a foreign jurisdiction shall notify from another jurisdiction. the Commission of such transfer, in the prescribed form and shall apply to the Commission to be licensed or registered not later than twenty-one days prior to transferring to the Currency Union. (2) An investment fund under subsection (1) shall submit to the Commission, the following information in support of its application– (a) the name of the investment fund; (b) the name of investment fund administrator; (c) the name of the investment fund manager; (d) the address of the registered office or principal office in the Currency Union; (e) the name and address of the operators; (f) the current offering document; (g) any other information prescribed by the Commission; and (h) evidence that the investment fund has complied with the laws of its current foreign jurisdiction. (3) An investment fund transferring to the Currency Union shall provide evidence of the surrender of its licence in the foreign jurisdiction. 292 Act 9 Investment Funds 2021 (4) The Commission may, upon the written application of the investment fund transferring to the Currency Union, extend the period within which the fund must obtain an investment fund licence or registration from the Commission. Voluntary 20.—(1) An investment fund shall notify the Commission surrender of licence by in the prescribed manner, of its intention to surrender its investment fund. licence or registration granted by the Commission, at least fourteen days prior to the effective date of the surrender. (2) The Commission may, on receiving a notification by an investment fund under subsection (1)– (a) accept, subject to such terms and conditions as it may impose, the voluntary surrender of the licence or registration of the investment fund if the Commission is satisfied that the surrender of the licence or registration would not be prejudicial to the public interest; or (b) without providing an opportunity to be heard, suspend the licence or registration or impose any condition or restriction on the licence that the Commission deems appropriate. (3) On the effective date of the surrender, where the Commission has accepted the voluntary surrender of a licence, the investment fund shall– (a) surrender to the Commission the original certificate issued as evidence of its being licensed or registered in the Currency Union; or 2021 Investment Funds Act 9 293 (b) in the event the original certificate is lost, submit to the Commission an affidavit attesting to the fact of such loss. (4) The Commission shall, within fourteen days of acceptance of the investment fund’s voluntary surrender of its licence or registration under subsection (2) (a), cause a public notice to be issued, that the investment fund is no longer licensed or registered in the Currency Union, by publication– (a) in the Official Gazette of each member country; (b) in a newspaper of general circulation in each member country; and (c) on the website of the Commission.

21.—(1) An investment fund that has not commenced Voluntary suspension of operations within one year of licensing or registration, or investment fund that ceases trading and liquidates and distributes its assets activity. without formally liquidating its structure is deemed to have voluntarily suspended its activity. (2) An investment fund shall inform the Commission, in writing, within fourteen days of the voluntary suspension of its activity. (3) Upon being notified that an investment fund has suspended its activity under subsection (1), the Commission shall suspend the licence or registration of the investment fund and cause a public notice to be issued, that the licence or registration of the fund has been suspended, by publication– 294 Act 9 Investment Funds 2021 (a) in the Official Gazette in each member country; (b) in a newspaper of general circulation in each member country; or (c) on the website of the Commission. (4) An investment fund whose licence or registration has been suspended under subsection (3) may resume its operation within one year from the date of suspension, failing which the Commission may revoke the licence or registration of such suspended investment fund. (5) An investment fund whose licence or registration has been suspended under subsection (3) that intends to resume its operation shall apply to the Commission to reinstate the suspended licence, and such application shall be made in the prescribed manner accompanied by the prescribed fee. (6) The Commission may upon the application of the investment fund extend the period of suspension of a licence or registration by a period not exceeding six months. (7) Upon being satisfied that the investment fund is in compliance with all provisions of this Act and the regulations, the Commission shall reinstate licence or registration of the investment fund suspended under subsection (3) and issue a public notice that the investment fund has been reinstated, to be published– (a) in the Official Gazette in each member country; (b) in a newspaper of general circulation in each member country; and (c) on the website of the Commission. 2021 Investment Funds Act 9 295

22.—(1) A person who applies for an investment Misrepresentation. fund licence or registration of a fund shall not supply the Commission with information that he or she knows or should reasonably know is false or misleading. (2) Where a regulated investment fund becomes aware that a service provider has provided it with false or misleading information, it shall immediately notify the Commission in writing. Part III SERVICE PROVIDERS DIVISION I LICENSING OF INVESTMENT FUND SERVICE PROVIDERS Prohibition

23.—(1) Subject to the provisions of this Part, no person by service shall carry on business as a service provider to an investment provider. fund in or from within the Currency Union unless it is licensed or registered by the Commission. (2) On application, the Commission may grant a licence or registration as a service provider if the Commission is satisfied that all the prescribed requirements have been fulfilled and to do so would be in the public interest. DIVISION II OPERATOR

24.—(1) An operator of an investment fund shall ensure Licensing or registration that the investment fund does not carry on or attempt to carry of investment on business as an investment fund contrary to the provisions operator. of this Act. 296 Act 9 Investment Funds 2021 (2) A person shall not act as an operator of an investment fund unless it is licensed or registered as such by the Commission. DIVISION III INVESTMENT FUND MANAGER Appointment of 25.—(1) Subject to subsection (3), an investment fund investment fund manager. shall appoint an investment fund manager. (2) An investment fund manager appointed under subsection (1) shall provide or is entitled to provide an investment fund with investment management services and such services may include providing investment advice for valuable consideration. (3) The Commission may exempt an investment fund from the requirements of this Division where– (a) its only investors are affiliates of the investment fund, and none of the investors is itself an investment fund; or (b) it is a feeder fund that invests one hundred per cent of its assets in a master fund. (4) An investment fund exempted from appointing an investment fund manager under subsection (3) shall meet such other requirements as prescribed. Licensing or 26.—(1) A person shall not act as an investment fund registration of investment manager of an investment fund unless it is licensed or fund manager. registered as such by the Commission. (2) Subject to subsection (3), a person shall apply to the Commission for a licence or registration to operate as an investment fund manager. 2021 Investment Funds Act 9 297 (3) The Commission may licence or register a person as an investment fund manager where that investment fund manager– (a) intends to manage a public fund; (b) intends to manage any investment fund in a jurisdiction, whose equity interests are offered to professional investors; or (c) is licensed or recognised in a prescribed jurisdiction.

27.—(1) The Commission shall not grant a licence to Grant of licence or approval of or approve the registration of an investment fund manager registration of an under this Part unless– investment fund manager. (a) the Commission is satisfied that the applicant is able to meet the conditions of this Part and the regulations; (b) the applicant has the prescribed capital, own funds and professional indemnity insurance in accordance with section 29; (c) the persons who effectively conduct the business of the applicant are of good repute and are experienced in relation to the investment strategies pursued by the investment funds to be managed by the applicant, and the conduct of the business of the applicant is decided by at least two persons meeting such conditions; and (d) the shareholders or members of the applicant that have qualifying holdings are suitable, 298 Act 9 Investment Funds 2021 taking into account the need to ensure the sound and prudent management of the applicant. (2) The Commission shall be provided with the prescribed information about the persons referred to in subsection (1) (c) prior to the grant of a licence or registration and the prescribed information about every person succeeding them in office. General duties 28.—(1) An investment fund manager shall– of an investment fund manager. (a) act honestly and fairly, with due skill, care and diligence in conducting its activities; (b) act in the best interests of each investment fund and the investors of each investment fund it manages and for the integrity of the market; (c) have and employ effectively the resources and procedures that are necessary for the proper performance of its business activities; (d) take all reasonable steps to avoid conflicts of interest and, when they cannot be avoided, to identify, manage, monitor and, where applicable, disclose those conflicts of interest in order to prevent them from adversely affecting the interests of each investment fund and its investors and to ensure that each investment fund it manages is fairly treated; (e) comply with all regulatory requirements applicable to the conduct of its business activities so as to promote the best interests of each investment fund and the investors of each investment fund it manages and the integrity of the market; and 2021 Investment Funds Act 9 299 (f) treat all investment fund investors fairly and ensure that no investor in an investment fund shall obtain preferential treatment, unless such preferential treatment is disclosed in the relevant investment fund’s constitutive documents. (2) Where an investment fund is exempted from appointing a custodian under section 40 (3) the investment fund manager shall ensure that it complies with such other requirements as may be prescribed.

29.—(1) A licensed investment fund manager shall meet Minimum capital the prescribed initial and ongoing capital requirements in and professional indemnity Eastern Caribbean Dollars or the equivalent in a currency insurance that is acceptable to the Commission. requirements. (2) An investment fund manager shall– (a) have own funds or additional own funds which are appropriate to cover potential liability risks arising from professional negligence; or (b) hold a professional indemnity insurance against liability arising from professional negligence which is appropriate to the risks covered.

30.—(1) Subject to subsection (3), an investment fund Chief Executive Officer of an manager shall appoint an individual as a Chief Executive investment fund Officer. manager. (2) An investment fund manager shall not appoint an individual as a Chief Executive Officer under subsection (1) unless it is satisfied that the individual is fit and proper and has satisfied the requirements as prescribed by the Commission. 300 Act 9 Investment Funds 2021 (3) A person shall not act as a Chief Executive Officer unless approved by the Commission. (4) The Commission may, by notice in writing to the Chief Executive Officer, attach any necessary conditions to the approval under subsection (3). Compliance 31.—(1) Subject to subsection (4), an investment fund officer of an investment manager shall appoint a person as a Compliance Officer, fund manager. subject to such conditions that the Commission shall prescribe. (2) A Compliance Officer is responsible for ensuring that an investment fund manager complies with all applicable laws. (3) An investment fund manager shall not appoint a person as Compliance Officer under subsection (1) unless it is satisfied that the person is fit and proper and has satisfied the requirements as prescribed by the Commission. (4) A person shall not act as a Compliance Officer unless approved by the Commission. (5) The Commission may, by notice in writing to the Compliance Officer, attach any necessary conditions to the approval under subsection (4). DIVISION IV INVESTMENT FUND ADMINISTRATOR Appointment of 32.—(1) Subject to subsection (2), an investment fund investment fund shall appoint an investment fund administrator. administrator. (2) The Commission may exempt an investment fund from the provisions of subsection (1). 2021 Investment Funds Act 9 301

33. No person other than a licensed or registered Name of investment fund administrator shall carry on or attempt investment fund administrator to carry on investment fund administration business in restricted. or from within the Currency Union with the words “fund administrator” in its name or title and shall not represent in any way that it is carrying on business in or from within the Currency Union as an investment fund administrator unless exempted or otherwise authorised to do so by the Commission.

34. A person shall not act as an investment fund Licensing or administrator unless it is licensed or registered as such by registration of an investment fund the Commission. administrator.

35. The Commission may grant an investment fund Grant of licence or approval of administrator’s licence if it is satisfied that the applicant– registration of an investment fund (a) is a company incorporated or registered under administrator. the Companies Act or International Business Companies Act of a member country; (b) has sufficient expertise to administer invest- ment funds; (c) is of sound reputation; (d) will administer investment funds in a proper manner; (e) has directors, officers, and senior management and significant security holders who meet the fit and proper requirements as prescribed by the Commission; (f) has a principal office in a member country; and (g) complies with the prescribed requirements. 302 Act 9 Investment Funds 2021 Obligations of 36. An investment fund administrator shall– an investment fund (a) provide the principal office for an investment administrator. fund that it administers in or from within the Currency Union; (b) pay the prescribed fees for each investment fund for which it provides a principal office in the Currency Union; (c) ensure that each party related to an investment fund is fit and proper as prescribed by the Commission; and (d) make such reports to the Commission regarding the investment funds for which it acts as the investment fund administrator, as the Commission may require. Minimum 37.—(1) An investment fund administrator who is a Capital and licensed or registered investment fund administrator, shall– professional indemnity insurance (a) meet the prescribed initial and ongoing capital requirements. requirements in Eastern Caribbean Dollars or the equivalent in a currency that is acceptable to the Commission; and (b) hold a professional indemnity insurance against liability arising from professional negligence which is appropriate to the risks covered. (2) If the investment fund administrator fails to comply with a direction given under subsection (1) the Commission shall– (a) request other financial guarantees, acceptable to the Commission, to be supplied by the investment fund administrator within ninety days; or 2021 Investment Funds Act 9 303 (b) where the investment fund administrator is unable to provide the guarantees under paragraph (a), revoke the licence or registration.

38.—(1) Subject to subsection (3), an investment Chief Executive Officer of an fund administrator shall appoint an individual as a Chief investment fund Executive Officer. administrator. (2) An investment fund administrator shall not appoint an individual as a Chief Executive Officer under subsection (1) unless it is satisfied that the individual is fit and proper and has satisfied the requirements as prescribed by the Commission. (3) A person shall not act as the Chief Executive Officer unless approved by the Commission. (4) The Commission may, by notice in writing to the Chief Executive Officer, attach any necessary conditions to the approval under subsection (3).

39.—(1) Subject to subsection (4), an investment fund Compliance officer of an administrator shall appoint a person as a Compliance investment Officer, subject to such conditions that the Commission fund administrator. shall prescribe. (2) A Compliance Officer is responsible for ensuring that an investment fund administrator complies with all applicable laws. (3) An investment fund administrator shall not appoint a person as Compliance Officer under subsection (1) unless it is satisfied that the person is fit and proper and has satisfied the requirements as prescribed by the Commission. (4) A person shall not act as a Compliance Officer unless approved by the Commission. 304 Act 9 Investment Funds 2021 (5) The Commission may, by notice in writing to the Compliance Officer, attach any necessary conditions to the approval under subsection (4). DIVISION V CUSTODIAN Appointment 40.—(1) An investment fund which is licensed or of custodian. registered by the Commission shall appoint one or more persons as custodian of the assets of the investment fund. (2) A custodian shall not act on behalf of an investment fund unless it is– (a) the holder of a custodian’s licence or registration certificate; and (b) established and operating in accordance with the laws of a member country of the Currency Union or of a foreign jurisdiction. (3) Notwithstanding subsection (1), the Commission may exempt a licensed or registered investment fund from the requirement to appoint a custodian where– (a) the investment fund’s only investors are affiliates of the investment fund, and that none of those investors is itself an investment fund; or (b) the assets of an investment fund are of a type that does not require the assets to be held in custody. (4) An investment fund exempted from appointing a custodian under subsection (3) shall meet such other requirements as prescribed. 2021 Investment Funds Act 9 305 (5) The custodian shall satisfy requirements as prescribed by the Commission from time to time.

41. A person shall not act as a custodian of an investment Licensing or fund unless it is licensed or registered as such by the registration of Commission. custodian.

42. An investment fund shall have a custodian that Independence is independent of the investment fund administrator, the of custodian. investment fund manager and the operator of the fund unless the fund is exempted by the Commission under section 40 (3).

43.—(1) A custodian that holds assets on behalf of an Segregation investment fund, including cheques and other similar of investment fund assets instruments, shall hold the assets separate and apart from its – custodian own property or that of any other person, and in trust for the appointed. investment fund. (2) A custodian that holds cash on behalf of an investment fund shall hold the cash separate and apart from the property of the custodian and any other person in a designated trust account with a financial institution licensed under the Banking Act, 2015 or other licensed deposit-taking institution in a recognised country. (3) A custodian may allow a licensed marketplace or clearing facility to hold or control cash belonging to an investment fund for the purpose of– (a) a transaction for the investment fund with or through that marketplace or facility; or (b) meeting the investment fund’s obligation to provide collateral for a transaction, provided that the investment fund is notified that the cash may be so held or controlled. 306 Act 9 Investment Funds 2021 Segregation 44.—(1) Where an investment fund is exempt from of investment fund assets – appointing a custodian under section 40 (3), any assets held exempt from on behalf of the investment fund, by a party related to the appointment of custodian. fund, including cheques and similar instruments, shall be held separate and apart from its own property and that of any other person, and in trust for the investment fund. (2) A party related to an investment fund that holds cash on behalf of the investment fund shall hold the cash separate and apart from the property of the party related to the fund in a designated trust account with a bank holding a licence under the Banking Act, 2015 or other licensed deposit-taking institution in a recognised country. (3) A party related to an investment fund may allow a licensed marketplace or clearing facility to hold or control cash belonging to an investment fund for the purpose of– (a) a transaction for the investment fund with or through that marketplace or facility; or (b) meeting the investment fund’s obligation to provide collateral for a transaction, provided that the investment fund is notified that the cash may be so held or controlled. Part IV GENERAL REGULATORY MATTERS Application 45.—(1) An application to the Commission for a licence for licensing or registration of or registration, shall be made in the prescribed form and licence. shall be accompanied by– 2021 Investment Funds Act 9 307 (a) such information as the Commission requires to assess the application; and (b) the prescribed fee. (2) A licence or registration is effective unless– (a) it is revoked by the Commission; (b) it expires; (c) the conditions for continuing the licence, or registration of the fund have not been satisfied; or (d) the Commission accepts a surrender of the regulated person’s licence under the provisions of this Act.

46.—(1) The Commission may, if it thinks fit, by notice Imposition, variation or in writing served on the regulated person or party related to revocation an investment fund, impose, vary or revoke a condition of a of terms and conditions licence or registration. of licence or registration. (2) A regulated person may request in writing, that the Commission waive, vary or revoke any condition attached to its licence.

47.—(1) A regulated person shall renew its licence or Renewal of licence. registration as applicable, on an annual basis by submitting an application for renewal to the Commission on or before the 1st day of April each year. (2) An application for renewal of a licence or registration of a fund shall be made on the prescribed form and shall be accompanied by the prescribed licence or registration renewal fee. 308 Act 9 Investment Funds 2021 Commission 48.—(1) The Commission shall maintain a service to maintain register. provider register to show details of investments funds and service providers that are licensed, registered or exempted under this Act. (2) The register under subsection (1) shall contain information to include– (a) the name of the regulated person; (b) the contact information for all parties related to an investment fund; (c) any conditions, under which the licence or registration was granted; and (d) any other information that may be prescribed by the Commission. (3) The Commission shall keep the register current. (4) A person may, upon payment of the prescribed fee, inspect and make copies of the register. Offence. 49.—(1) Any person who carries on business requiring a licence or registration under Part II or III without holding such a licence or registration certificate, or other than in accordance with the person’s licence or registration, commits an offence and is liable on summary conviction– (a) in the case of an individual, to a fine not exceeding five hundred thousand dollars or to imprisonment for a term not exceeding two years or to both; (b) in the case of a company, to a fine not exceeding one million dollars. 2021 Investment Funds Act 9 309 (2) If the offence is a continuing offence, the individual or company is liable to a further fine not exceeding 10 per cent of the maximum fine above for every day that the offence continues after conviction. Part V ADMINISTRATIVE AND FINANCIAL MATTERS

50.—(1) A service provider shall not undertake to Due diligence by licensed provide services to an investment fund unless the service service provider has satisfied itself that it may carry out its tasks and provider. responsibilities to that fund in accordance with the securities laws and all other legislation applicable to that fund. (2) Subsection (1) shall be deemed a condition of every service-provider licence for the purposes of this Act.

51.—(1) A service provider shall not appoint or change a Delegation of tasks. third-party provider to assist it with the provision of services for which a service-provider licence has been granted, unless– (a) the prior written approval of the Commission has been obtained for the appointment or change; (b) the third-party provider complies with such conditions imposed by the Commission; and (c) the prescribed fee has been paid. (2) Notwithstanding subsection (1) (a), the Commission may exempt a service-provider from the obligation to obtain the Commission’s approval under subsection (1). 310 Act 9 Investment Funds 2021 (3) A service provider with a valid service provider licence may delegate tasks to a third-party provider but the delegating service provider’s responsibilities may not be delegated. Service 52. Where a service provider knows or has reason to provider to give notice of believe that an investment fund for which it provides services, certain matters. or an operator, auditor, or promoter of such investment fund– (a) is, or is likely to become unable to meet its obligations as they fall due; (b) is carrying on business otherwise than in accordance with this Act or any other law; or (c) is carrying on business in a manner that is or is likely to be prejudicial to investors or creditors of the investment fund, the service provider shall immediately give the Commission written notice of its knowledge or belief giving its reason for that knowledge or belief. Auditor to be 53.—(1) Every regulated person shall appoint an appointed. approved auditor who shall conduct an audit of the regulated person’s annual financial statements. (2) The audit of a regulated person’s financial statements shall be performed in accordance with generally accepted auditing standards and the auditor shall provide the Commission with the prescribed reports on the financial affairs of the regulated person within the prescribed period. (3) The Commission may impose all or any of the following duties on the auditor of a regulated person– 2021 Investment Funds Act 9 311 (a) a duty to submit to the Commission such additional information in relation to the audit as the Commission considers necessary; (b) a duty to enlarge or extend the scope of the audit of the business and affairs of the person licensed or registered under this Part; (c) a duty to carry out any other examination or establish any procedure in any particular case; (d) a duty to submit a report to the Commission on any matters referred to in paragraphs (b) and (c), and the auditor shall carry out such additional duty or duties. (4) Every regulated person shall remunerate the auditor in respect of the discharge of such additional duty or duties as the Commission may impose under subsection (3).

54. If, during the performance of his or her duties as Obligations of auditors. auditor for a regulated person under this Act, an approved auditor– (a) becomes aware of any matter which in his or her opinion adversely affects the financial position of the entity being audited to a material extent; or (b) discovers evidence of a contravention of such provisions as may be prescribed, 312 Act 9 Investment Funds 2021 the auditor shall as soon as is practicable, and in any event within seven days, report the matter in writing to the Commission and to the regulated person. Instructions to 55.—(1) The Commission may at any time instruct a audit accounts. regulated person– (a) to have its accounts audited; and (b) to submit the audited financial statements to the Commission, within such time as the Commission shall specify. (2) The audited financial statements referred to in subsection (1) shall be prepared in accordance with generally accepted auditing standards and shall be at the expense of the regulated person. Reporting 56.—(1) Within the prescribed periods, a regulated to the Commission. person shall deliver to the Commission– (a) annual financial statements in respect of the regulated person’s financial year along with the report of the auditor; (b) interim financial statements and other information as may be prescribed; and (c) all other reports, information or documents that the Commission deems necessary. (2) A public fund shall disseminate to the public any report filed with the Commission under subsection (1) within the prescribed period. (3) The audit of the financial statements of a regulated person shall be performed in accordance with generally accepted auditing accounting principles and the auditor 2021 Investment Funds Act 9 313 shall provide the Commission with the prescribed reports on the financial affairs of the regulated person within the prescribed period.

57. A regulated person shall use reasonable efforts to Compliance with directions. ensure that it complies with any direction given to it by the Commission in accordance with the provisions of this Act.

58. A regulated person shall not appoint or change a Approval by the director, operator, Chief Executive Officer (or the equivalent Commission. position) as the case may be, or any other person for whom initial approval by the Commission was required, unless– (a) the prior written approval of the Commission has been obtained, for the appointment; or (b) the Commission has exempted the regulated person from the obligation to obtain the Commission’s approval, and the prescribed fee has been paid.

59. The initial requirements for a licence or registration Initial requirements or such other requirements imposed by this Act or the must be Commission from time to time shall continue to be met by maintained. the person throughout the period for which the licence is valid.

60.—(1) The Commission shall administer this Act. Commission to administer law. (2) The Commission shall– (a) maintain a general review of investment fund business in the Currency Union and submit an annual report to the Monetary Council; 314 Act 9 Investment Funds 2021 (b) be responsible for supervision and enforcement in respect of persons to whom this Act applies; and (c) for the investigation of persons where the Commission reasonably believes that they are or have been in breach of this Act. (3) Whenever the Commission considers it necessary or expedient, the Commission may– (a) conduct onsite or offsite inspections; (b) examine prescribed regular returns, auditors’ reports or ad hoc reports requested by the Commission; and (c) engage in such other activity as the Commission may determine, to regulate the affairs or business of any regulated person for the purpose of a general review or for the purpose of satisfying itself that this Act is being complied with. (4) The Commission may charge a fee as prescribed for an inspection conducted under this Part. (5) Upon application, the Commission may grant an exemption regarding the payment of costs where the Commission considers it appropriate. (6) In carrying out its responsibilities, the Commission may, in addition to any powers granted under this Act, exercise any of the powers and responsibilities granted to it under Parts III, IV, V, VI, VII, IX, X, XII, XIII, XIV and 2021 Investment Funds Act 9 315 XV of the Securities Act, 2021 and the Eastern Caribbean Securities Regulatory Commission Agreement. (7) The powers and responsibilities granted to the Commission under subsection (6) may be exercised mutatis mutandis with respect to all parties subject to the Commission’s jurisdiction under this Act. Part VI MISCELLANEOUS PROVISIONS

61.—(1) A person who contravenes any provision of this General Act or the regulations, not otherwise provided for in this Act, offence. commits an offence and is liable on summary conviction to a fine not exceeding one million dollars or to imprisonment for a term not exceeding ten years or to both. (2) Notwithstanding subsection (1), where an offence is committed by a company, a director and every senior officer of that company who knowingly authorised, permitted or acquiesced in the commission of the offence also commits an offence and is liable on summary conviction to the same penalty prescribed for the company.

62. The Minister may, on the recommendation of Regulations. the Commission, make regulations that are necessary or expedient for carrying out the purposes of this Act and to give effect to the functions and responsibilities of the Commission.

63. In carrying out the purposes of this Act and its Rules. functions and responsibilities under the Act, the Commission may make rules providing for such matters as may be necessary or expedient for giving effect to such purposes, functions and responsibilities. 316 Act 9 Investment Funds 2021 Winding up, 64. A regulated investment fund, investment fund dissolution and manager, or investment fund administrator shall inform the termination. Commission of its intent to wind up, dissolve or terminate within thirty days or such other time period as may be prescribed by the Commission before the formal winding up, dissolution or other termination procedure has commenced. Recognised 65. The Commission may, by Notice published in the country. Gazette, recognise a country for the purposes of this Act. Transitional 66.—(1) From the date of the commencement of this Act provisions. a person other than a regulated investment fund carrying on or attempting to carry on business as an investment fund with the words “fund” or “investment fund” shall within ninety days remove the offending words. (2) From the date of the commencement of this Act a person other than a regulated investment fund administrator carrying on or attempting to carry on business as an investment fund administrator with the words “fund administrator” shall within ninety days remove the offending words. Passed by the House of Representatives this 21st day of May, 2021. ANDREW AUGUSTINE Clerk to the House of Representatives. Passed by the Senate this 2nd day of June, 2021. ANDREW AUGUSTINE Clerk to the Senate. GRENADA PRINTED BY THE GOVERNMENT PRINTER, AT THE GOVERNMENT PRINTING OFFICE, ST. GEORGE’S 13/8/2021.