The Collective Investment Schemes (Miscellaneous Amendments) Regulations 2003

Explanatory Note

(This note is not part of the Regulations)

Part 2 of these Regulations amends the Financial Services and Markets Act 2000 (“the Act”) and the Financial Services and Markets Act 2000 (EEA Passport Rights) Regulations 2001 (S.I. 2001/2511) so as to enable management companies of undertakings for collective investment in transferable securities (“UCITS”) to exercise their Community law rights of free movement of services and right of establishment.

Part 3 of these Regulations amends the Act in so far as it applies to collective investment schemes which are UCITS. Regulation 5 provides that the Financial Services Authority may make rules restricting the activities of the management company of an authorised open-ended investment company which is a UCITS. Regulation 6 amends the Financial Services and Markets Act 2000 (Consultation with Competent Authorities) Regulations 2001 (S.I. 2001/2509). Regulation 7 amends the Financial Services and Markets Act 2000 (Compensation Scheme: Electing Participants) Regulations 2001 (S.I. 2001/1783) in so far as it applies to EEA firms which are management companies and which have authorisation from their home state regulator to carry on activities of the kind specified by Article 5.3(a) of Council Directive 85/611/EEC with regard to investments of UCITS (management of portfolios).

Part 4 of the Regulations makes miscellaneous amendments to related legislation. Regulation 10 amends Schedule 5 to the Act to provide that a body which is incorporated and authorised pursuant to the Open-Ended Investment Companies Act (Northern Ireland) 2002 and which is a UCITS is an authorised person. Regulation 11 amends the Financial Services and Markets Act 2000 (Collective Investment Schemes Constituted in Other EEA States) Regulations 2001 (S.I. 2001/2383) so as to provide that the notice given under section 264 of the Act (notice to the Authority of intention to invite persons in the United Kingdom to become participants in an EEA scheme) must include the scheme’s simplified prospectus. Regulation 12 amends the Financial Services and Markets Act 2000 (Disclosure of Confidential Information) Regulations 2001 (S.I. 2001/2188). These amendments are consequential on the amendments made to the Act by Part 2 of these Regulations.

Regulation 13 amends references to Council Directive 85/611/EEC on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities in other legislation.

These Regulations implement in part Directive 2001/107/EC of the European Parliament and of the Council amending Council Directive 85/611/EEC with a view to regulating management companies and simplified prospectuses and Directive 2001/108/EC of the European Parliament and of the Council 2001/107/EC amending Council Directive 85/611/EEC with regard to investments of UCITS. A Transposition Note setting out how the main elements of these Directives will be transposed into UK law is available from the Banking and General Insurance Team, HM Treasury, 1 Horseguards Road, London SW1A 2HQ. The Transposition Note is also on HM Treasury’s website (www.hm-treasury.gov.uk).