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The Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996

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Regulation 4

SCHEDULE 1APPLICATION OF PART XXIV OF 1985 ACT

1.  Part XXIV of the 1985 Act (the registrar of companies, his functions and offices) shall, subject to the modifications set out in paragraphs 2 to 8 below, apply for the purposes of the registration of, and the functions of the registrar of companies in relation to, investment companies with variable capital under these Regulations as it applies to the registration of, and the functions of the registrar in relation to, companies within the meaning given by section 735(1) of that Act.

(2) Except in the expressions “the registrar of companies” and “the Companies Acts”, any reference to companies (including any such reference in section 711 of the 1985 Act as it applies with the modifications set out in paragraph 6 below) shall be taken to be a reference to investment companies with variable capital.

(3) Any reference to the Companies Acts (including any reference to the 1985 Act, however expressed) shall be taken to be a reference to these Regulations and SIB regulations.

(4) Any reference to the memorandum of a company shall be taken to be a reference to the instrument of incorporation of an investment company with variable capital; and any reference to the registered office of a company shall be taken to be a reference to the head office of an investment company with variable capital.

(5) Any power to make regulations under Part XXIV of the 1985 Act in relation to companies shall be exercisable in relation to investment companies with variable capital—

(a)for like purposes; and

(b)subject to the same conditions.

(6) Section 711 of the 1985 Act (public notice by registrar of receipt and issue of certain documents) shall apply as if for paragraphs (a) to (z) of subsection (1) there were substituted the following paragraphs—

(a)any document making or evidencing an alteration in a company’s instrument of incorporation;

(b)any notice of a change in the address of a company’s head office;

(c)any notice of a change in the directors of a company;

(d)any notice of a change in the depositary of a company;

(e)any annual report of a company delivered under regulation 65(5) or (6) above;

(f)any copy of an order in respect of a company made by virtue of regulation 64 above;

(g)any copy of a winding up order in respect of a company; and

(h)any copy of any instrument providing for the dissolution of a company on a winding up.

7.  Section 714 (registrar’s index of company and corporate names) shall have effect as if the bodies listed in subsection (1) of that section included—

(a)investment companies with variable capital in respect of which an authorisation order has come into effect; and

(b)collective investment schemes which are open-ended investment companies and which have head offices situated in Northern Ireland and which comply with the conditions necessary for them to enjoy the rights conferred by the UCITS Directive.

8.  The following provisions of Part XXIV of the 1985 Act shall not apply, that is to say—

(a)in section 705, the words in subsection (4) from “but for a period” to the end and subsection (5);

(b)section 705A;

(c)section 707A(4);

(d)section 710;

(e)section 710B(6) and (7);

(f)section 711(2);

(g)in section 711A, in subsection (1) the words “or made available by the company for inspection” and subsection (4); and

(h)section 714(2).

Regulation 5

SCHEDULE 2DEPOSITARIES

Appointment

1.  On the coming into effect of an authorisation order in respect of an investment company with variable capital, the person named in the application under regulation 7 above as depositary of the company shall be deemed to be appointed as its first depositary.

2.  Subject to regulations 15 and 20 above, any subsequent appointment of the depositary of a company shall be made by the directors of the company.

Retirement

3.  The depositary of a company may not retire voluntarily except upon the appointment of a new depositary.

Rights

4.  (1)  The depositary of a company is entitled—

(a)to receive all such notices of, and other communications relating to, any general meeting of the company as a shareholder of the company is entitled to receive;

(b)to attend any general meeting of the company;

(c)to be heard at any general meeting which it attends on any part of the business of the meeting which concerns it as depositary;

(d)to convene a general meeting of the company when it sees fit;

(e)to require from the company’s officers such information and explanations as it thinks necessary for the performance of its functions as depositary; and

(f)to have access, except in so far as they concern its appointment or removal, to any reports, statements or other papers which are to be considered at any meeting held by the directors of the company (when acting in their capacity as such), at any general meeting of the company or at any meeting of holders of shares of any particular class.

(2) Sub-paragraph (1)(e) above applies to a shadow director of an investment company with variable capital as it applies to an officer of such a company.

Statement by depositary ceasing to hold office

5.  (1)  Where the depositary of a company ceases, for any reason other than by virtue of a court order made under regulation 20 above, to hold office, it may deposit at the head office of the company a statement of any circumstances connected with its ceasing to hold office which it considers should be brought to the attention of the shareholders or creditors of the company or, if it considers that there are no such circumstances, a statement that there are none.

(2) If the statement is of circumstances which the depositary considers should be brought to the attention of the shareholders or creditors of the company, the company shall not later than 14 days after the deposit of the statement either—

(a)send a copy of the statement to each of the shareholders whose name appears on the register of shareholders (other than the person who is designated in the company’s instrument of incorporation for the purposes of paragraph 4 of Schedule 5 to these Regulations) and take such steps as SIB regulations may require for the purpose of bringing the fact that the statement has been made to the attention of the holders of any bearer shares; or

(b)apply to the court;

and, where an application is made under paragraph (b) above, the company shall notify the depositary.

(3) Unless the depositary receives notice of an application to the court before the end of the period of 21 days beginning with the day on which it deposited the statement, it shall not later than seven days after the end of that period send a copy of the statement to each of the registrar of companies and SIB.

(4) If the court is satisfied that the depositary is using the statement to secure needless publicity for defamatory matter—

(a)it shall direct that copies of the statement need not be sent out and that the steps required by SIB regulations need not be taken; and

(b)it may further order the company’s costs on the application to be paid in whole or in part by the depositary notwithstanding that the depositary is not a party to the application;

and the company shall not later than 14 days after the court’s decision take such steps in relation to a statement setting out the effect of the order as are required by sub-paragraph (2)(a) above in relation to the statement deposited under sub-paragraph (1) above.

(5) If the court is not so satisfied, the company shall not later than 14 days after the court’s decision take the steps required by sub-paragraph (2)(a) above and notify the depositary of the court’s decision.

(6) The depositary shall not later than seven days after receiving such a notice send a copy of the statement to each of the registrar of companies and SIB.

(7) Where a notice of appeal is filed not later than 14 days after the court’s decision, any reference to that decision in sub-paragraphs (4) and (5) above shall be construed as a reference to the final determination or withdrawal of that appeal, as the case may be.

6.  (1)  This paragraph applies where copies of a statement have been sent to shareholders under paragraph 5 above.

(2) The depositary who made the statement has, notwithstanding that it has ceased to hold office, the rights conferred by paragraph 4(1)(a) to (c) above in relation to the general meeting of the company next following the date on which the copies were sent out.

(3) The reference in paragraph 4(1)(c) above to business concerning the depositary as depositary shall be construed in relation to a depositary who has ceased to hold office as a reference to business concerning it as former depositary.

Regulation 9

SCHEDULE 3INSTRUMENT OF INCORPORATION

1.  The instrument of incorporation of an investment company with variable capital shall—

(a)contain the statements set out in paragraph 2 below; and

(b)contain provision made in accordance with paragraphs 3 and 4 below.

2.  The statements referred to in paragraph 1(a) above are—

(a)the head office of the company is situated in England and Wales, Wales or Scotland (as the case may be);

(b)the company is an open-ended investment company with variable share capital;

(c)the shareholders are not liable for the debts of the company;

(d)the scheme property is entrusted to a depositary for safekeeping (subject to any exceptions permitted by SIB regulations); and

(e)charges or expenses of the company may be taken out of the scheme property.

3.  (1)  The instrument of incorporation shall contain provision as to the following matters—

(a)the object of the company;

(b)any matter relating to the procedure for the appointment, retirement and removal of any director of the company for which provision is not made in these or SIB regulations; and

(c)the currency in which the accounts of the company are to be prepared.

(2) Subject to sub-paragraph (3) below, the provision referred to in sub-paragraph (1)(a) above as to the object of an investment company with variable capital shall be a statement that the object of the company is to invest the scheme property in transferable securities with the aim of spreading investment risk and giving its shareholders the benefit of the results of the management of that property.

(3) The object of the company may differ from that set out in sub-paragraph (2) above only to the extent that it provides for restriction of the range of transferable securities in which investment may be made.

4.  (1)  The instrument of incorporation shall also contain provision as to the following matters—

(a)the name of the company;

(b)the category, as specified in SIB regulations, to which the company belongs;

(c)the maximum and minimum sizes of the company’s capital;

(d)in the case of an umbrella company, the investment objectives applicable to each part of the scheme property that is pooled separately;

(e)the classes of shares that the company may issue indicating, in the case of an umbrella company, which class or classes of shares may be issued in respect of each part of the scheme property that is pooled separately;

(f)the rights attaching to shares of each class (including any provision for the expression in two denominations of such rights);

(g)if the company is to be able to issue bearer shares, a statement to that effect together with details of any limitations on the classes of the company’s shares which are to include bearer shares;

(h)in the case of a company which is a participating issuer, a statement to that effect together with an indication of any class of shares in the company which is a class of participating securities;

(i)if the company is to dispense with the requirements of regulation 40 above, the details of any substituted procedures for evidencing title to the company’s shares; and

(j)the form, custody and use of the company’s common seal (if any).

(2) For the purposes of sub-paragraph (1)(c) above, the size at any time of a company’s capital shall be taken to be the value at that time, as determined in accordance with SIB regulations, of the scheme property of the company less the liabilities of the company.

5.  (1)  Once an authorisation order has been made in respect of a company, no amendment may be made to the statements contained in the company’s instrument of incorporation which are required by paragraph 2 above.

(2) Subject to paragraph 3(3) above and to any restriction imposed by SIB regulations, a company may amend any other provision which is contained in its instrument of incorporation.

(3) No amendment to a provision which is contained in a company’s instrument of incorporation by virtue of paragraph 3 above may be made unless it has been approved by the shareholders of the company in general meeting.

6.  (1)  The provisions of a company’s instrument of incorporation shall be binding on the officers and depositary of the company and on each of its shareholders; and all such persons (but no others) shall be taken to have notice of the provisions of the instrument.

(2) A person is not debarred from obtaining damages or other compensation from a company by reason only of his holding or having held shares in the company.

Regulation 43

SCHEDULE 4REGISTER OF SHAREHOLDERS

General

1.  (1)  Subject to sub-paragraph (2) below, every investment company with variable capital shall keep a register of persons who hold shares in the company.

(2) Except to the extent that the aggregate numbers of shares mentioned in paragraphs 5(1)(b) and 7 below include bearer shares, nothing in this Schedule requires any entry to be made in the register in respect of bearer shares.

2.  (1)  Subject as mentioned in sub-paragraph (2) below, the register of shareholders shall be prima facie evidence of any matters which are by these Regulations directed or authorised to be contained in it.

(2) In the case of a register kept by a company which is a participating issuer, sub-paragraph (1) above has effect subject to regulation 23(7) of the Uncertificated Securities Regulations 1995(1) (purported registration of transfer of title to uncertificated unit other than in accordance with that regulation to be of no effect).

3.  In the case of companies registered in England and Wales, no notice of any trust, express, implied or constructive, shall be entered on the company’s register or be receivable by the company.

4.  A company shall exercise all due diligence and take all reasonable steps to ensure that the information contained in the register is at all times complete and up to date.

Contents

5.  (1)  The register of shareholders shall contain an entry consisting of—

(a)the name of the person who is designated in the company’s instrument of incorporation for the purposes of paragraph 4 of Schedule 5 to these Regulations (in this Schedule referred to as the designated person);

(b)a statement of the aggregate number of all shares in the company held by that person; and

(c)in the case of a company which is a participating issuer, a statement in respect of shares of any class that is a class of participating securities of how many shares of that class are held by that person in uncertificated form and certificated form respectively.

(2) In sub-paragraph (1) above—

(a)for the purposes of paragraph (b), the designated person shall be taken as holding all shares in the company which are in issue and in respect of which no other person’s name is entered on the register; and

(b)in paragraph (c), “uncertificated form” and “certificated form” have the same meaning as in the Uncertificated Securities Regulations 1995(2).

(3) The statements referred to in paragraphs (b) and (c) of sub-paragraph (1) above shall be up-dated at least once a day.

6.  (1)  This paragraph shall not apply to any issue of shares to the designated person or to any transfer of shares to the designated person to which paragraph 4 of Schedule 5 to these Regulations applies.

(2) Where a company issues a share to any person and the name of that person is not already entered on the register, the company shall enter his name on the register.

(3) In respect of any person whose name is entered on the register in accordance with sub-paragraph (2) above or paragraph 6 of Schedule 5 to these Regulations, the register shall contain an entry consisting of—

(a)the address of the shareholder;

(b)the date on which the shareholder’s name was entered on the register;

(c)a statement of the aggregate number of shares held by the shareholder, distinguishing each share by its number (if it has one) and, where the company has more than one class of shares, by its class; and

(d)in the case of a company which is a participating issuer, a statement in respect of shares of any class that is a class of participating securities of how many shares of that class are held by the shareholder in uncertificated form and certificated form respectively.

(4) In sub-paragraph (3)(d) above, “uncertificated form” and “certificated form” have the same meaning as in the Uncertificated Securities Regulations 1995.

7.  The register of shareholders shall contain a monthly statement of the aggregate number of all the bearer shares in issue except for any bearer shares in issue which, at the time when the statement is made, are held by the designated person.

8.  (1)  This paragraph applies where the aggregate number of shares referred to in paragraphs 5 to 7 above includes any shares to which attach rights expressed in two denominations.

(2) In respect of each class of shares to which are attached rights expressed in two denominations, the number of shares of that class held by any person referred to in paragraph 5 or 6 above, or the number of bearer shares of that class referred to in paragraph 7 above, shall be taken to be the total of—

(3) In sub-paragraph (2) above—

(a)N is the relevant number of larger denomination shares of that class;

(b)n is the relevant number of smaller denomination shares of that class; and

(c)p is the number of smaller denomination shares of that class that are equivalent to one larger denomination share of that class.

(4) Nothing in these Regulations shall be taken as preventing the total arrived at under sub-paragraph (2) above being expressed on the register as a single entry representing the result derived from the formula set out in that sub-paragraph.

Location

9.  The register of shareholders of a company shall be kept at its head office, except that—

(a)if the work of making it up is done at another office of the company, it may be kept there; and

(b)if the company arranges with some other person for the making up of the register to be undertaken on its behalf by that other person, it may be kept at the office of the other person at which the work is being done.

Index

10.  (1)  Every company shall keep an index of the names of the holders of its registered shares.

(2) The index shall contain, in respect of each shareholder, a sufficient indication to enable the account of that shareholder in the register to be readily found.

(3) The index shall be at all times kept at the same place as the register of shareholders.

(4) Not later than 14 days after the date on which any alteration is made to the register of shareholders, the company shall make any necessary alteration in the index.

Inspection

11.  (1)  Subject to regulation 44 above and to SIB regulations, the register of shareholders and the index of names shall be open to the inspection of any shareholder (including any holder of bearer shares) without charge.

(2) Any shareholder may require a copy of the entries on the register relating to him and the company shall cause any copy so required by a person to be sent to him free of charge.

(3) If an inspection required under this paragraph is refused, or if a copy so required is not sent, the court may by order compel an immediate inspection of the register and index, or direct that the copy required be sent to the person requiring it.

Agent’s default

12.  (1)  Sub-paragraphs (2) and (4) below apply where, in accordance with paragraph 9(b) above, the register of shareholders is kept at the office of some person other than the company and by reason of any default of his—

(a)the company fails to comply with any of the requirements of paragraph 10 or 11 above; or

(b)the company fails to comply with any of the requirements of regulation 65(2) above.

(2) In a case to which this sub-paragraph applies, the person at whose office the register of shareholders is kept is guilty of an offence if he knowingly or recklessly authorises or permits the default in question.

(3) A person guilty of an offence under sub-paragraph (2) above is liable in respect of each default on summary conviction to a fine not exceeding level 1 on the standard scale.

(4) The power of the court under paragraph 11(3) above extends to the making of orders directed to the person at whose office the register of shareholders is kept and to any officer or employee of his.

Regulation 46

SCHEDULE 5SHARE TRANSFERS

General

1.  The instrument of incorporation of a company may contain provision as to share transfers in respect of any matter for which provision is not made in these Regulations or SIB regulations.

2.  Where any shares are transferred to the company, the company shall cancel those shares.

3.  In the case of a company which is a participating issuer, nothing in this Schedule shall apply—

(a)to any transfer of a share in the company which is an uncertificated unit of a security; or

(b)in any of the circumstances set out in sub-paragraph (b) or (c) of regulation 27(2) of the Uncertificated Securities Regulations 1995(3) (conversion of securities into uncertificated form).

Transfer of registered shares

4.  (1)  Where a transfer of shares is made by the person (if any) who is designated in the company’s instrument of incorporation for the purposes of this paragraph, the company may not register the transfer unless such evidence as the company may require to prove that the transfer has taken place has been delivered to the company.

(2) Where for any reason a person ceases to be designated for the purposes of this paragraph—

(a)any shares held by that person which are not disposed of on or before his ceasing to be so designated shall be deemed to be the subject of a new transfer to him which takes effect immediately after he ceases to be so designated; and

(b)the company shall make such adjustments to the register as are necessary to reflect his change of circumstances.

5.  (1)  Except in the case of any transfer of shares referred to in paragraph 4 above, the company may not register any transfer unless the transfer documents relating to that transfer have been delivered to the company.

(2) No share certificate shall be required to be delivered by virtue of sub-paragraph (1) above in any case where shares are transferred by a nominee of a recognised investment exchange who is designated for the purposes of regulation 41(6) above in the rules of the investment exchange in question.

(3) In these Regulations “transfer documents”, in relation to any transfer of registered shares, means—

(a)a stock transfer within the meaning of the Stock Transfer Act 1963(4) which complies with the requirements of that Act as to the execution and contents of a stock transfer or such other instrument of transfer as is authorised by, and completed and executed in accordance with any requirements in, the company’s instrument of incorporation;

(b)except in a case falling within paragraph (3) or (4) of regulation 41 above, a share certificate relating to the shares in question;

(c)in a case falling within paragraph (3) of that regulation above, such other evidence of title to those shares as is required by the instrument of incorporation of the company; and

(d)such other evidence (if any) as the company may require to prove the right of the transferor to transfer the shares in question.

6.  In the case of any transfer of shares which meets the requirements of paragraph 4 or 5 above, the company shall—

(a)register the transfer; and

(b)where the name of the transferee is not already entered on the register, enter that name on the register.

7.  (1)  A company may, before the end of the period of 21 days commencing with the date of receipt of the transfer documents relating to any transfer of shares, refuse to register the transfer if—

(a)there exists a minimum requirement as to the number or value of shares that must be held by any shareholder of the company and the transfer would result in either the transferor or transferee holding less than the required minimum; or

(b)the transfer would result in a contravention of any provision of the company’s instrument of incorporation or would produce a result inconsistent with any provision of the company’s prospectus.

(2) A company shall give the transferee written notice of any refusal to register a transfer of shares.

(3) Nothing in these Regulations shall require a company to register a transfer or give notice to any person of a refusal to register a transfer where registering the transfer or giving the notice would result in a contravention of any provision of law (including any law that is for the time being in force in a country or territory outside the United Kingdom).

8.  (1)  Where, in respect of any transfer of shares, the company certifies that it has received the transfer documents referred to in paragraph 5(3)(b) or (c) above (as the case may be), that certification shall be taken as a representation by the company to any person acting on the faith of the certification that there has been produced to the company such evidence as on its face shows a prima facie title to the shares in the transferor named in the instrument of transfer.

(2) For the purposes of sub-paragraph (1) above, a certification is made by a company if the instrument of transfer—

(a)bears the words “certificate lodged”(or words to the like effect); and

(b)is signed by a person acting under authority (whether express or implied) given by the company to issue and sign such certifications.

(3) A certification under sub-paragraph (1) above shall not be taken as a representation that the transferor has any title to the shares in question.

(4) Where a person acts on the faith of a false certification by a company which is made negligently or fraudulently, the company shall be liable to pay to that person any damages sustained by him.

Transfer of bearer shares

9.  A transfer of title to any bearer share in a company is effected by the transfer from one person to another of the instrument mentioned in regulation 42 above which relates to that share.

10.  Where the holder of bearer shares proposes to transfer to another person a number of shares which is less than the number specified in the instrument relating to those shares, he may only do so if he surrenders the instrument to the company and obtains a new instrument specifying the number of shares to be transferred.

Miscellaneous

11.  Nothing in the preceding provisions of this Schedule shall prejudice any power of the company to register as shareholder any person to whom the right to any shares in the company has been transmitted by operation of law.

12.  A transfer of registered shares that are held by a deceased person at the time of his death which is made by his personal representative is as valid as if the personal representative had been the holder of the shares at the time of the execution of the instrument of transfer.

13.  On the death of any one of the joint holders of any shares, the survivor or survivors shall be the only persons recognised by the company as having any title to or any interest in those shares.

Regulation 63

SCHEDULE 6AUDITORS

Eligibility

1.  No person is eligible for appointment as auditor of an investment company with variable capital unless he is also eligible under section 25 of the Companies Act 1989(5) (eligibility for appointment as company auditor) for appointment as a company auditor.

2.  (1)  A person is ineligible for appointment as auditor of an investment company with variable capital if he is—

(a)an officer or employee of the company; or

(b)a partner or employee of such a person, or a partnership of which such a person is a partner.

(2) For the purposes of sub-paragraph (1) above, an auditor of a company shall not be regarded as an officer or employee of the company.

(3) The power of the Secretary of State to make regulations under section 27 of the Companies Act 1989 (ineligibility on ground of lack of independence) in relation to the appointment of company auditors shall be exercisable in relation to the appointment of auditors of investment companies with variable capital—

(a)for like purposes; and

(b)subject to the same conditions.

(4) Any reference in this paragraph to an officer of an investment company with variable capital shall include a reference to a shadow director of such a company.

3.  (1)  No person shall act as auditor of a company if he is ineligible for appointment to the office.

(2) If during his term of office an auditor of a company becomes ineligible for appointment to the office, he shall thereupon vacate office and shall forthwith give notice in writing to the company concerned that he has vacated it by reason of ineligibility.

(3) A person who acts as auditor of a company in contravention of sub-paragraph (1) above or fails to give notice of vacating his office as required by sub-paragraph (2) above is guilty of an offence and liable—

(a)on conviction on indictment, to a fine;

(b)on summary conviction, to a fine not exceeding the statutory maximum.

(4) In the case of continued contravention he is liable on a second or subsequent summary conviction (instead of the fine mentioned in sub-paragraph (3)(b) above) to a fine not exceeding £100 in respect of each day on which the contravention is continued.

(5) In proceedings against a person for an offence under this paragraph it is a defence for him to show that he did not know and had no reason to believe that he was, or had become, ineligible for appointment.

Appointment

4.  (1)  Every company shall appoint an auditor or auditors in accordance with this paragraph.

(2) A company shall, at each general meeting at which the company’s annual report is laid, appoint an auditor or auditors to hold office from the conclusion of that meeting until the conclusion of the next general meeting at which an annual report is laid.

(3) The first auditors of a company may be appointed by the directors of the company at any time before the first general meeting of the company at which an annual report is laid; and auditors so appointed shall hold office until the conclusion of that meeting.

(4) Where no appointment is made under sub-paragraph (3) above, the first auditors of any company may be appointed by the company in general meeting.

(5) No rules made under section 107 of the 1986 Act (appointment etc of auditors) shall apply in relation to investment companies with variable capital.

5.  If, in any case, no auditors are appointed as required in paragraph 4 above, SIB may appoint a person to fill the vacancy.

6.  (1)  The directors of a company, or the company in general meeting, may fill a casual vacancy in the office of auditor.

(2) While such a vacancy continues, any surviving or continuing auditor or auditors may continue to act.

7.  (1)  Sub-paragraphs (2) to (5) below apply to the appointment as auditor of a company of a partnership constituted under the law of England and Wales or Northern Ireland, or under the law of any other country or territory in which a partnership is not a legal person; and sub-paragraphs (3) to (5) below apply to the appointment as such an auditor of a partnership constituted under the law of Scotland, or under the law of any other country or territory in which a partnership is a legal person.

(2) The appointment is, unless the contrary intention appears, an appointment of the partnership as such and not of the partners.

(3) Where the partnership ceases, the appointment shall be treated as extending to—

(a)any partnership which succeeds to the practice of that partnership and is eligible for the appointment; and

(b)any person who succeeds to that practice having previously carried it on in partnership and is eligible for the appointment.

(4) For this purpose a partnership shall be regarded as succeeding to the practice of another partnership only if the members of the successor partnership are substantially the same as those of the former partnership; and a partnership or other person shall be regarded as succeeding to the practice of a partnership only if it or he succeeds to the whole or substantially the whole of the business of the former partnership.

(5) Where the partnership ceases and no person succeeds to the appointment under sub-paragraph (3) above, the appointment may with the consent of the company be treated as extending to a partnership or other person eligible for the appointment who succeeds to the business of the former partnership or to such part of it as is agreed by the company shall be treated as comprising the appointment.

Rights

8.  (1)  The auditors of a company shall have a right of access at all times to the company’s books, accounts and vouchers and are entitled to require from the company’s officers such information and explanations as they think necessary for the performance of their duties as auditors.

(2) An officer of a company commits an offence if he knowingly or recklessly makes to the company’s auditors a statement (whether written or oral) which—

(a)conveys or purports to convey any information or explanations which the auditors require, or are entitled to require, as auditors of the company; and

(b)is misleading, false or deceptive in a material particular.

(3) A person guilty of an offence under sub-paragraph (2) above is liable—

(a)on conviction on indictment, to imprisonment not exceeding a term of two years or to a fine or to both;

(b)on summary conviction, to imprisonment not exceeding a term of three months or to a fine not exceeding the statutory maximum or to both.

(4) This paragraph applies to a shadow director of an investment company with variable capital as it applies to an officer of such a company.

9.  (1)  The auditors of a company are entitled—

(a)to receive all such notices of, and other communications relating to, any general meeting of the company as a shareholder of the company is entitled to receive;

(b)to attend any general meeting of the company; and

(c)to be heard at any general meeting which they attend on any part of the business of the meeting which concerns them as auditors.

(2) The right to attend and be heard at a meeting is exercisable in the case of a body corporate or partnership by an individual authorised by it in writing to act as its representative at the meeting.

Remuneration

10.  (1)  The remuneration of auditors of a company who are appointed by the company in general meeting shall be fixed by the company in general meeting or in such manner as the company in general meeting may determine.

(2) The remuneration of auditors who are appointed by the directors or SIB shall, as the case may be, be fixed by the directors or SIB (and shall be payable by the company even where it is fixed by SIB).

11.  (1)  Subject to sub-paragraph (2) below, the power of the Secretary of State to make regulations under section 390B of the 1985 Act(6) (remuneration of auditors and their associates for non-audit work) in relation to company auditors shall be exercisable in relation to auditors of investment companies with variable capital—

(a)for like purposes; and

(b)subject to the same conditions.

(2) For the purposes of the exercise of the power to make regulations under section 390B of the 1985 Act, as extended by sub-paragraph (1) above, the reference in section 390B(3) to a note to a company’s accounts shall be taken to be a reference to the annual report of an investment company with variable capital.

Removal

12.  (1)  A company may by resolution remove an auditor from office notwithstanding anything in any agreement between it and him.

(2) Where a resolution removing an auditor is passed at a general meeting of a company, the company shall not later than 14 days after the holding of the meeting notify SIB of the passing of the resolution.

(3) Nothing in this paragraph shall be taken as depriving a person removed under it of compensation or damages payable to him in respect of the termination of his appointment as auditor or of any appointment terminating with that as auditor.

Rights on removal or non-reappointment

13.  (1)  A resolution at a general meeting of a company—

(a)removing an auditor before the expiration of his period of office; or

(b)appointing as auditor a person other than the retiring auditor;

is not effective unless notice of the intention to move it has been given to the investment company with variable capital at least 28 days before the meeting at which it is moved.

(2) On receipt of notice of such an intended resolution, the company shall forthwith send a copy to the person proposed to be removed or, as the case may be, to the person proposed to be appointed and to the retiring auditor.

(3) The auditor proposed to be removed or, as the case may be, the retiring auditor may make with respect to the intended resolution representations in writing to the company (not exceeding a reasonable length) and request their notification to the shareholders of the company.

(4) The company shall (unless the representations are received by the company too late for it to do so)—

(a)in any notice of the resolution given to the shareholders of the company, state the fact of the representations having been made;

(b)send a copy of the representations to each of the shareholders whose name appears on the register of shareholders (other than the person who is designated in the company’s instrument of incorporation for the purposes of paragraph 4 of Schedule 5 to these Regulations) and to whom notice of the meeting is or has been sent;

(c)take such steps as SIB regulations may require for the purpose of bringing the fact that the representations have been made to the attention of the holders of any bearer shares; and

(d)at the request of any holder of bearer shares, provide a copy of the representations.

(5) If a copy of any such representations is not sent out as required because they were received too late or because of the company’s default or if, for either of those reasons, any steps required by sub-paragraph (4)(c) or (d) above are not taken, the auditor may (without prejudice to his right to be heard orally) require that the representations be read out at the meeting.

(6) Copies of the representations need not be sent out, the steps required by sub-paragraph (4)(c) or (d) above need not be taken and the representations need not be read out at the meeting if, on the application of the company or any other person claiming to be aggrieved, the court is satisfied that the rights conferred by this paragraph are being abused to secure needless publicity for defamatory matter; and the court may order the costs of the company on such an application to be paid in whole or in part by the auditor, notwithstanding that he is not a party to the application.

14.  (1)  An auditor who has been removed from office has, notwithstanding his removal, the rights conferred by paragraph 9 above in relation to any general meeting of the company at which his term of office would otherwise have expired or at which it is proposed to fill the vacancy caused by his removal.

(2) Any reference in paragraph 9 above to business concerning the auditors as auditors shall be construed in relation to an auditor who has been removed from office as a reference to business concerning him as former auditor.

Resignation

15.  (1)  An auditor of a company may resign his office by depositing a notice in writing to that effect at the company’s head office.

(2) Such a notice is not effective unless it is accompanied by the statement required by paragraph 18 below.

(3) An effective notice of resignation operates to bring the auditor’s term of office to an end as of the date on which the notice is deposited or on such later date as may be specified in it.

(4) The company shall not later than 14 days after the deposit of a notice of resignation send a copy of the notice to SIB.

16.  (1)  This paragraph applies where a notice of resignation of an auditor is accompanied by a statement of circumstances which he considers ought to be brought to the attention of the shareholders or creditors of the company.

(2) An auditor may deposit with the notice a signed requisition that a general meeting of the company be convened forthwith for the purpose of receiving and considering such explanation of the circumstances connected with his resignation as he may wish to place before the meeting.

(3) The company shall, not later than 21 days after the date of the deposit of a requisition under this paragraph, proceed to convene a meeting for a day not more than 28 days after the date on which the notice convening the meeting is given.

(4) The auditor may request the company to circulate to the shareholders of the company whose name appears on the register of shareholders (other than the person who is designated in the company’s instrument of incorporation for the purposes of paragraph 4 of Schedule 5 to these Regulations)—

(a)before the meeting convened on his requisition; or

(b)before any general meeting at which his term of office would otherwise have expired or at which it is proposed to fill the vacancy caused by his resignation;

a statement in writing (not exceeding a reasonable length) of the circumstances connected with his resignation.

(5) The company shall (unless the statement is received by it too late for it to do so)—

(a)in any notice or advertisement of the meeting given or made to shareholders of the company, state the fact of the statement having been made;

(b)send a copy of the statement to every shareholder of the company to whom notice of the meeting is or has been sent; and

(c)at the request of any holder of bearer shares, provide a copy of the statement.

(6) If a copy of the statement is not sent out or provided as required because it was received too late or because of the company’s default the auditor may (without prejudice to his right to be heard orally) require that the statement be read out at the meeting.

(7) Copies of a statement need not be sent out or provided and the statement need not be read out at the meeting if, on the application of the company or any other person claiming to be aggrieved, the court is satisfied that the rights conferred by this paragraph are being abused to secure needless publicity for defamatory matter; and the court may order the costs of the company on such an application to be paid in whole or in part by the auditor, notwithstanding that he is not a party to the application.

17.  (1)  An auditor who has resigned has, notwithstanding his removal, the rights conferred by paragraph 9 above in relation to any such general meeting of the company as is mentioned in paragraph 16(4)(a) or (b) above.

(2) The reference in paragraph 9 above to business concerning the auditors as auditors shall be construed in relation to an auditor who has resigned as a reference to business concerning him as former auditor.

Statement by auditor ceasing to hold office

18.  (1)  Where an auditor ceases for any reason to hold office, he shall deposit at the head office of the company a statement of any circumstances connected with his ceasing to hold office which he considers should be brought to the attention of the shareholders or creditors of the company or, if he considers that there are no such circumstances, a statement that there are none.

(2) The statement shall be deposited—

(a)in the case of resignation, along with the notice of resignation;

(b)in the case of failure to seek re-appointment, not less than 14 days before the end of the time allowed for next appointing auditors; and

(c)in any other case, not later than the end of the period of 14 days beginning with the date on which he ceases to hold office.

(3) If the statement is of circumstances which the auditor considers should be brought to the attention of the shareholders or creditors of the company, the company shall not later than 14 days after the deposit of the statement either—

(a)send a copy of the statement to each of the shareholders whose name appears on the register of shareholders (other than the person who is designated in the company’s instrument of incorporation for the purposes of paragraph 4 of Schedule 5 to these Regulations) and take such steps as SIB regulations may require for the purpose of bringing the fact that the statement has been made to the attention of the holders of any bearer shares; or

(b)apply to the court;

and, where an application is made under paragraph (b) above, the company shall notify the auditor.

(4) Unless the auditor receives notice of an application to the court before the end of the period of 21 days beginning with the day on which he deposited the statement, he shall not later than seven days after the end of that period send a copy of the statement to each of the registrar of companies and SIB.

(5) If the court is satisfied that the auditor is using the statement to secure needless publicity for defamatory matter—

(a)it shall direct that copies of the statement need not be sent out and that the steps required by SIB regulations need not be taken; and

(b)it may further order the company’s costs on the application to be paid in whole or in part by the auditor notwithstanding that he is not a party to the application;

and the company shall not later than 14 days after the court’s decision take such steps in relation to a statement setting out the effect of the order as are required by sub-paragraph (3)(a) above in relation to the statement deposited under sub-paragraph (1) above.

(6) If the court is not so satisfied, the company shall not later than 14 days after the court’s decision send to each of the shareholders a copy of the auditor’s statement and notify the auditor of the court’s decision.

(7) The auditor shall not later than seven days after receiving such a notice send a copy of the statement to each of the registrar of companies and SIB.

(8) Where a notice of appeal is filed not later than 14 days after the court’s decision, any reference to that decision in sub-paragraphs (5) and (6) above shall be construed as a reference to the final determination or withdrawal of that appeal, as the case may be.

19.  (1)  If a person ceasing to hold office as auditor fails to comply with paragraph 18 above, he is guilty of an offence and liable—

(a)on conviction on indictment, to a fine;

(b)on summary conviction, to a fine not exceeding the statutory maximum.

(2) In proceedings for an offence under sub-paragraph (1) above, it is a defence for the person charged to show that he took all reasonable steps and exercised all due diligence to avoid the commission of the offence.

Regulation 64

SCHEDULE 7MERGERS AND DIVISIONS

1.  This Schedule applies to any reconstruction or amalgamation involving an investment company with variable capital which takes the form of a scheme described in paragraph 4 below.

2.  An investment company with variable capital may apply to the court under section 425 of the 1985 Act(7) (power of company to compromise with creditors or members) for an order sanctioning a scheme falling within any of paragraphs (a) to (c) of paragraph 4(1) below where—

(a)the scheme in question involves a compromise or arrangement with its shareholders or creditors or any class of its shareholders or creditors; and

(b)the consideration for the transfer or each of the transfers envisaged by the scheme is to be—

(i)shares in the transferee company receivable by shareholders of the transferor company; or

(ii)where there is more than one transferor company and any one or more of them is a public company, shares in the transferee company receivable by shareholders or members of the transferor companies (as the case may be);

in each case with or without any cash payment to shareholders.

3.  A public company may apply to the court under section 425 of the 1985 Act for an order sanctioning a scheme falling within any of paragraph (b) or (c) of paragraph 4(1) below where—

(a)the scheme in question involves a compromise or arrangement with its members or creditors or any class of its members or creditors; and

(b)the consideration for the transfer or each of the transfers envisaged by the scheme is to be—

(i)shares in the transferee company receivable by members of the transfesor company; or

(ii)where there is more than one transferor company and any one or more of them is an investment company with variable capital, shares in the transferee company receivable by members or shareholders of the transferor companies (as the case may be);

in each case with or without any cash payment to shareholders.

4.  (1)  The schemes falling within this paragraph are—

(a)any scheme under which the undertaking, property and liabilities of an investment company with variable capital are to be transferred to another such company, other than one formed for the purpose of, or in connection with, the scheme;

(b)any scheme under which the undertaking, property and liabilities of two or more bodies corporate, each of which is either—

(i)an investment company with variable capital; or

(ii)a public company;

are to be transferred to an investment company with variable capital formed for the purpose of, or in connection with, the scheme;

(c)any scheme under which the undertaking, property and liabilities of an investment company with variable capital or a public company are to be divided among and transferred to two or more investment companies with variable capital whether or not formed for the purpose of, or in connection with, the scheme.

(2) Nothing in this Schedule shall be taken as enabling the court to sanction a scheme under which the whole or any part of the undertaking, property or liabilities of an investment company with variable capital may be transferred to any person other than an investment company with variable capital.

5.  For the purposes of this Schedule, sections 425 to 427 of the 1985 Act shall, subject to paragraph 6 below, have effect in respect of any application made by virtue of paragraph 2 or 3 above as they have effect in respect of applications falling within section 427A(1) of that Act (that is to say, subject to the provisions of section 427A of, and Schedule 15B to, that Act (mergers and divisions of public companies))(8).

6.  (1)  All the provisions of the 1985 Act referred to in paragraph 5 above shall have effect with such modifications as are necessary or appropriate for the purposes of this Schedule.

(2) In particular, any reference in those provisions to a Case 1 Scheme, a Case 2 Scheme or a Case 3 Scheme shall be taken to be a reference to a scheme falling within paragraph (a), (b) or (c) of paragraph 4(1) above.

(3) Without prejudice to the generality of sub-paragraph (1) above, the following references in those provisions shall, unless the context otherwise requires, have effect as indicated below, that is to say—

(a)any reference to a scheme shall be taken to be a reference to a scheme falling within any of paragraphs (a) to (c) of paragraph 4(1) above;

(b)any reference to a company shall be taken to be a reference to an investment company with variable capital;

(c)any reference to members shall be taken to be a reference to shareholders of an investment company with variable capital;

(d)any reference to the registered office of a company shall be taken to be a reference to the head office of an investment company with variable capital;

(e)any reference to the memorandum and articles of a company shall be taken to be a reference to the instrument of incorporation of an investment company with variable capital;

(f)any reference to a report under section 103 of the 1985 Act shall be taken to be a reference to any report with respect to the valuation of any non-cash consideration given for shares in an investment company with variable capital which may be required by SIB regulations;

(g)any reference to annual accounts shall be taken to be a reference to the accounts contained in the annual report of an investment company with variable capital;

(h)any reference to a directors' report, in relation to a company’s annual accounts, shall be taken to be a reference to any report of the directors of an investment company with variable capital that is contained in the company’s annual report;

(i)any reference to the requirements of the 1985 Act as to balance sheets forming part of a company’s annual accounts shall be taken to be a reference to any requirements arising by virtue of SIB regulations as to balance sheets drawn up for the purposes of the accounts contained in the annual report of an investment company with variable capital;

(j)any reference to paid up capital shall be taken to be a reference to the share capital of an investment company with variable capital.

Regulation 75

SCHEDULE 8MINOR AND CONSEQUENTIAL AMENDMENTS

PART IPRIMARY LEGISLATION

Trustee Investments Act 1961 (c. 62)

1.  In Part III of Schedule 1 to the Trustee Investments Act 1961 (wider-range investments), after paragraph 2 there shall be inserted the following paragraph—

2A.  In any shares in an investment company with variable capital within the meaning of the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996..

Stock Transfer Act 1963 (c. 18)

2.  In section 1(4) of the Stock Transfer Act 1963 (registered securities to which section 1 applies), after paragraph (e) there shall be inserted the following paragraph—

(f)shares issued by an investment company with variable capital within the meaning of the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996..

Data Protection Act 1984 (c. 35)

3.  Section 30 of the Data Protection Act 1984 (exemption for regulation of financial services etc) shall have effect as if the reference in subsection (2) to any enactment included these Regulations.

Companies Act 1985 (c. 6)

4.  In section 26 of the 1985 Act (prohibition on registration of certain names)—

(a)in subsection (1) after paragraph (b) there shall be inserted the following paragraph—

(bb)which includes, at any place in the name, the expression “investment company with variable capital” or its Welsh equivalent (“cwmni buddsoddi â chyfalaf newidiol”);;

(b)in subsection (3)(b) the word “and” after “(“anghyfyngedig”)” shall be omitted and at the end there shall be inserted

and

investment company with variable capitalor its Welsh equivalent (“cwmni buddsoddi â chyfalaf newidiol”);.

5.  In section 199(2A)(9) of the 1985 Act (interests to be disregarded in determining whether a person holds a material interest in shares), after paragraph (b) there shall be inserted the following paragraph—

(bb)an interest belonging to an investment company with variable capital;.

6.  In section 209(1)(h) of the 1985 Act(10) (interests to be disregarded for purposes of obligation to disclose interests in shares) the word “or” at the end of sub-paragraph (i) shall be omitted and, after sub-paragraph (ii), there shall be inserted

or

(iii)by virtue of his being a depositary, within the meaning of the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996, of an investment company with variable capital..

7.  In section 220(1) of the 1985 Act(11) (definitions for Part VI of the Act), after the definition of “designated agency” there shall be inserted the following definition—

“investment company with variable capital” has the same meaning as in the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996;.

8.  In section 716(2) of the 1985 Act(12) (exemptions from prohibition on formation of any company, association or partnership with more than 20 members), after paragraph (d) there shall be inserted the following paragraph—

(e)of an investment company with variable capital within the meaning of the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996..

9.  In section 718(2) of the 1985 Act (exemptions from application of Act to unregistered companies), after paragraph (c) there shall be inserted the following paragraph—

(d)any investment company with variable capital within the meaning of the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996..

Company Directors Disqualification Act 1986 (c. 46)

10.  In Schedule 1 to the Company Directors Disqualification Act 1986(13) (matters for determining unfitness of directors), after paragraph 5 there shall be inserted the following paragraph—

5A.  In the application of this Part of this Schedule in relation to any person who is a director of an investment company with variable capital, any reference to a provision of the Companies Act shall be taken to be a reference to the corresponding provision of the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996 or of any regulations made under regulation 6 of those Regulations (SIB regulations)..

Financial Services Act 1986 (c. 60)

11.  After section 24 of the 1986 Act (operators and trustees of recognised schemes) there shall be inserted the following section—

Investment companies with variable capital
Investment companies with variable capital

24A.  An investment company with variable capital is an authorised person as respects—

(a)investment business which consists in operating the collective investment scheme constituted by the company; and

(b)any investment business which is carried on by the company in connection with or for the purposes of operating that scheme..

12.  In section 47A(4) of the 1986 Act(14) (disciplinary action which may be taken in respect of failure to comply with statements of principle) the word “or” at the end of paragraph (c) shall be omitted and after paragraph (d) there shall be inserted

or

(e)the giving of a direction under regulation 18 of the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996 (directions) or the making of an application for an order under regulation 20 of those Regulations (application to court to remove director or depositary);.

13.  In section 72 of the 1986 Act (winding up orders), at the end of subsection (5) (petition to wind up members of recognised self-regulating organisation) there shall be inserted the following subsection—

(6) Subsection (5) above does not apply to the presentation of a petition under subsection (1) above for the winding up of an investment company with variable capital..

14.  In section 76(1) of the 1986 Act (restrictions on promotion of collective investment schemes), after the words “authorised unit trust scheme” there shall be inserted the words “or an investment company with variable capital”.

15.  In section 83(2) of the 1986 Act (activities in which manager of authorised unit trust scheme may engage)—

(a)after paragraph (a) there shall be inserted—

(aa)acting as a director of an investment company with variable capital;;

(b)in paragraph (b), after the words “mentioned in paragraph (a)” there shall be inserted the words “or (aa)”.

16.  In section 87 of the 1986 Act (schemes authorised in designated countries or territories)—

(a)at the beginning of subsection (2) there shall be inserted “Subject to subsection (2A) below,”; and

(b)at the end of subsection (2) there shall be inserted the following subsection—

(2A) Nothing in subsection (2) above shall require the comparison set out in that subsection to be made where—

(a)the class of collective investment schemes to be specified in an order includes schemes having characteristics corresponding to those of an investment company with variable capital; and

(b)having regard to the characteristics of such schemes, it appears more appropriate to consider whether investors in the United Kingdom are afforded protection at least equivalent to that provided for them by the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996;

and, to the extent that the requirements of paragraph (b) above are met, the relevant comparison shall be between the protection afforded to investors in the United Kingdom by the law under which collective investment schemes of the class to be specified in the order are authorised and supervised in the country or territory concerned and the protection provided for such investors by the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996..

17.  In section 102 of the 1986 Act (register of authorised persons etc)—

(a)in subsection (2), after paragraph (b) there shall be inserted the following paragraph—

(bb)in the case of an investment company with variable capital which is an authorised person by virtue of section 24A above, the name of the company, the address of the company’s head office and the names and addresses of the directors and depositary of the company;;

(b)in subsection (6), for the words “or (b)” there shall be substituted the words “, (b) or (bb)”.

18.  In section 104(1) of the 1986 Act (power to call for information) after “24,” there shall be inserted “24A,”.

19.  In section 108(1) of the 1986 Act (power to require second audit), after the words “by virtue of section” there shall be inserted “24A,”.

20.  In section 205A of the 1986 Act(15) (supplementary provisions with respect to subordinate legislation)—

(a)in subsection (1) for “The following provisions” there shall be substituted “Subsections (2) to (4) below”; and

(b)after subsection (1) there shall be inserted the following subsection

(1A) Subsections (2) to (4) below also apply to any power to make regulations by virtue of regulation 6 of the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996 in the event that that power becomes exercisable by the Treasury by virtue of an order under section 115 above..

21.  In section 206(1) of the 1986 Act(16) (publication of information and advice), after paragraph (b) there shall be inserted the following paragraphs—

(bb)the operation of the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996 and any regulations made by virtue of regulation 6 of those Regulations;

(cc)any matters relating to the functions to which regulation 73 of those Regulations relates;.

22.  In section 207(1) of the 1986 Act (interpretation) after the definition of “investment agreement” there shall be inserted the following definition—

  • “investment company with variable capital” and, in relation to such a company, “depositary” have the same meaning as in the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996;.

23.  In Schedule 8 to the 1986 Act(17) (principles applicable to designated agency’s legislative provisions), at the end of paragraph 1(1) there shall be inserted the words “and the provisions of regulations made under regulation 6 of the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996”.

24.  In paragraph 7 of Schedule 9 to the 1986 Act (designated agencies; status and exercise of transferred functions), after “this Act” there shall be inserted “or, as the case may be, the provision of the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996,”.

Pension Schemes Act 1993 (c. 48)

25.  In section 38(6) (permitted forms for appropriate schemes), after paragraph (c) there shall be inserted the following paragraph—

(d)an investment company with variable capital within the meaning of the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996..

PART IISUBORDINATE LEGISLATION

The Data Protection (Regulation of Financial Services etc) (Subject Access Exemption) Order 1987 (S.I. 1987/1905)

26.  Schedule 1 to the Data Protection (Regulation of Financial Services etc) (Subject Access Exemption) Order 1987(18) (functions designated for purposes of section 30 of Data Protection Act 1984) shall have effect as if at the end there were inserted the following entry—

Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996Functions of the Securities and Investments Board under Regulations

The Uncertificated Securities Regulations 1995 (S.I. 1995/3272)

27.  In regulation 3(1) of the Uncertificated Securities Regulations 1995 (interpretation) in the definition of “unit of security”, after the words “(for example a single share)” there shall be inserted

and, in the case of any share—

(a)which is issued by an investment company with variable capital (within the meaning of the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996) which is a participating issuer; and

(b)to which are attached rights expressed in two denominations;

it includes any smaller denomination share and any larger denomination share (within the meaning, in the case of each such share, of the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996).

28.  In regulation 19 of those Regulations (entries on registers), after paragraph (8) there shall be inserted the following paragraph—

(9) This regulation shall not apply to a participating issuer which is an investment company with variable capital (within the meaning of the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996)..

(1)

S.I. 1995/3272.

(2)

S.I. 1995/3272.

(3)

S.I. 1995/3272.

(6)

Section 390B was inserted into the 1985 Act by section 121 of the Companies Act 1989 (c. 40).

(7)

Section 425 was amended by section 109(i) of, and paragraph 11 of Schedule 6 to, the Insolvenct Act 1985 (c. 65).

(8)

Section 427A of, and Schedule 15B to, the 1985 Act were inserted by the Companies (Mergers and Divisions) Regulations 1987 (S.I. 1987/1991).

(9)

Subsection (2A) of section 199 of the 1985 Act was inserted by the Disclosure of Interests in Shares (Amendment) Regulations 1993 (S.I. 1993/1819).

(10)

Section 209 of the 1985 Act was substituted by the Disclosure of Interests in Shares (Amendment) Regulations 1993 (S.I. 1993/1819).

(11)

Subsection (1) of section 220 of the 1985 Act was substituted by the Disclosure of Interests in Shares (Amendment) Regulations 1993 (S.I. 1993/1819).

(12)

Paragraph (d) of section 716(2) of the 1985 Act was inserted by section 145 of, and paragraph 15 of Schedule 19 to, the Companies Act 1989 (c. 40).

(13)

Paragraph 5 of Schedule 1 was substituted by section 23 of, and paragraph 35 of Schedule 10 to, the Companies Act 1989 (c. 40).

(14)

Section 47A was inserted into the 1986 Act by section 192 of the Companies Act 1989 (c. 40).

(15)

Section 205A of the 1986 Act was inserted by section 206(1) of, and paragraph 18 of Schedule 23 to, the Companies Act 1980; subsection (1) was amended by paragraph 8 of Schedule 4 to the Transfer of Functions (Financial Services) Order 1992 (S.I. 1992/1315).

(16)

Section 206 of the 1986 Act was amended by section 206 of, and paragraph 19 of Schedule 23 to, the Companies Act 1989 (c. 40).

(17)

Paragraph 1 was substituted by section 206(1) of, and paragraph 23 of Schedule 23 to, the Companies Act 1989.

(18)

There are amendments that are not relevant to these Regulations.

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