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  • CIU-4.1 CIU-4.1 Mergers and Transfers

    • CIU-4.1.1

      The CBB’s prior written approval must be obtained for any mergers of Bahrain domiciled CIUs or transfer of its assets to another CIU. The CBB approval will consider how such event would impact the investors and whether their concerns are addressed sufficiently. The CBB must be notified of any proposed merger of overseas domiciled CIUs or transfer of its assets to another CIU.

      Amended: October 2022
      Added: April 2022

    • CIU-4.1.2

      The operator of Bahrain domiciled CIUs must provide the following information to the CBB in the approval requests required in Paragraph CIU-4.1.1:

      (a) The terms of the proposed merger approved by both parties;
      (b) Up to date version of the offering documents;
      (c) Confirmation from the custodians, and where relevant the fund administrators, of both the merging and the receiving CIU that the type of merger, the process and the date of the merger are in compliance with the constituent and offering documents of the CIU and the relevant laws and regulations of the Kingdom of Bahrain;
      (d) Report of the external auditor confirming valuation of the assets and liabilities on the date for calculating the exchange ratio, the cash payment per unit (where applicable), and the calculation method of the exchange ratio and the actual exchange ratio determined at the date for calculating that ratio; and
      (e) The information on the proposed merger that the operators intend to provide to their respective CIU participants.
      Added: April 2022

    • CIU-4.1.3

      The operator of Bahrain domiciled CIUs must provide the following information to the CIU participants, following receipt of written approval from the CBB referred to in Paragraph CIU-4.1.1, and at least thirty days before the last date for requesting repurchase or redemption or conversion without additional charge:

      (a) Identification of the type of merger and of the CIUs involved;
      (b) The background to and rationale for the proposed merger;
      (c) The expected impact of the proposed merger on the CIU participants of both CIUs including but not limited to any material differences in respect of investment policy and strategy, costs, expected outcome, periodic reporting, possible dilution in performance, and, where relevant, changes in tax treatment following the merger;
      (d) Any specific rights CIU participants have in relation to the proposed merger, including the right to obtain additional information, the right to obtain or request a copy of the report of the external auditor, the independent valuer or the custodian where relevant, and the right to request the repurchase or redemption or the conversion of their units without charge;
      (e) The criteria adopted for valuation of the assets and, where applicable, the liabilities on the date for calculating the exchange ratio of units of the merging CIU into units of the receiving CIU for determining the relevant net asset value;
      (f) The calculation method of the exchange ratio;
      (g) The cash payment per unit (where applicable);
      (h) The planned effective date of the merger; and
      (i) The rules applicable, respectively, to the transfer of assets and the exchange of units.
      Added: April 2022

    • CIU-4.1.4

      For open-ended Bahrain domiciled retail CIUs where there is a proposed merger or transfer, the CIU participants have the right to request, without any charge other than those retained by the CIU to meet disinvestment costs, the repurchase or redemption of their units or, where possible, to convert them into units in another CIU with similar investment policy and managed by the same operator or by any other licensee with which the operator is linked by common management or control, or by a substantial direct or indirect holding. This right will become effective from the moment that the CIU participants have been informed of the proposed merger or transfer and will cease to exist five working days before the date for calculating the exchange ratio.

      Added: April 2022

    • CIU-4.1.5

      During the merger or transfer process, the relevant CIU operator may temporarily suspend the subscription, repurchase or redemption of units, provided that any such suspension is justified for the protection of the CIU participants. The CBB may also require the temporary suspension of the subscription, repurchase or redemption of units, for the protection of the CIU participants.

      Added: April 2022