Back Custom print Link Text Only Rich Text Print

  • CIU-4 CIU-4 Overseas Domiciled CIUs

    • CIU-4.1 CIU-4.1 Registration and Authorisation

      • Registration Requirements

        • CIU-4.1.1

          Overseas domiciled CIUs that fall under the categories listed in the table appearing in Rule CIU-B.6.3, must be registered with the CBB before they are offered to investors in Bahrain.

        • CIU-4.1.2

          Overseas domiciled CIUs that do not appear under the categories listed in the table appearing in Rule CIU-B.6.3, but which satisfy the exemption conditions specified in Section CIU-3.1, must also be registered with the CBB before they are offered to investors in Bahrain.

        • CIU-4.1.3

          All other overseas domiciled CIUs, i.e. those that satisfy neither the conditions specified in Rules CIU-4.1.1 and CIU-4.1.2, are required to be authorised by the CBB prior to being offered to investors in Bahrain: see Rules CIU-4.1.20 below.

      • Registration Process

        • CIU-4.1.4

          An application for registration under either Rules CIU-4.1.1 or CIU-4.1.2 must be made using a Form CIU (R) (Application for Registration of a CIU), submitted under a formal cover letter signed by two authorised signatories of the applicant. The application may only be made by the CBB licensee that is proposing to offer the CIU to investors in Bahrain.

        • CIU-4.1.5

          Only CBB licensees that are licensed either as conventional bank licensees (Volume 1 of the CBB Rulebook), Islamic bank licensees (Volume 2) or investment firm licensees (Volume 4), may offer overseas domiciled CIUs in Bahrain.

        • CIU-4.1.6

          The application must identify an individual who should be capable of being contacted by the CBB by post, telephone, fax and/or e-mail.

        • CIU-4.1.7

          The CBB's review of registration applications is mainly limited to satisfying itself that the applicant satisfies the conditions specified in Rules CIU-4.1.1 and CIU-4.1.2, and which category of scheme it falls under (i.e. retail CIU, expert CIU or exempt CIU): this may require seeking confirmation of the CIU's regulatory status from its home regulator, and reviewing the CIU's documentation (such as promotional material and its prospectus). The CBB does not however review the proposed structure or operations in detail, although it reserves the right to seek appropriate confirmations or additional information from the applicant.

        • CIU-4.1.8

          The CBB takes a decision on an application for registration made under Rules CIU-4.1.1 and CIU-4.1.2 within 15 calendar days of the application being received and assessed by the CBB as complete.

      • Granting or refusal of registration

        • CIU-4.1.9

          To be registered, an applicant must demonstrate that it will comply with the conditions specified in Rules CIU-4.1.1 or CIU-4.1.2 (as appropriate). Should the application for registration be accepted, the CBB will notify the applicant in writing of the fact. The registration may be subject to additional conditions being met.

        • CIU-4.1.10

          The CBB may refuse to register an overseas domiciled CIU, if in its opinion:

          (a) The conditions in Rules CIU-4.1.1 or CIU-4.1.2 (as appropriate) are not met;
          (b) False or misleading information has been provided to the CBB, or significant information which should have been provided to the CBB has not been so provided; or
          (c) The CBB believes it necessary in order to safeguard the interests of potential investors.

        • CIU-4.1.11

          Where the CBB proposes to refuse an application for registration, it must give the applicant written notice to that effect. Applicants have 30 calendar days from the date of the written notice to appeal the decision, as per the appeal procedures specified in the notice.

      • Fees Payable to CBB (registered overseas domiciled CIUs)

        • CIU-4.1.12

          No processing or annual registration fees are payable by overseas domiciled CIUs subject to Rules CIU-4.1.1 or CIU-4.1.2.

      • De-registration

        • CIU-4.1.13

          The CBB licensee responsible for distributing an overseas domiciled CIU must must seek prior written approval from the CBB if they wish to de-register the fund. They must provide an explanation for wishing to de-register, and the options available to participants in the event of de-registration (such options to include, if possible, a right to switch without charge into another CIU).

        • CIU-4.1.14

          The CBB will normally respond to such requests within 15 calendar days of the request being made.

        • CIU-4.1.15

          Once approval has been granted under Rule CIU-4.1.13, the CBB licensee concerned must give at least one month's written notice to participants. The notice must provide an explanation and explain the participants' options (as specified in Rule CIU-4.1.13). A copy of this notice must be provided to the CBB at the time it is issued to participants.

        • CIU-4.1.16

          Once the CIU's participants have been repaid, or transferred to another CIU, the CBB licensee must notify the CBB of the fact and request that the CIU concerned be taken off the CBB register of overseas domiciled CIUs.

        • CIU-4.1.17

          In all cases, the CBB licensee should keep the CBB informed about their timetable and progress made in either transferring CIU participants into another CIU, or returning moneys due to them.

        • CIU-4.1.18

          The CBB may cancel the registration of an overseas domiciled CIU if in its opinion:

          (a) Any of the applicable requirements contained in Module CIU are not met;
          (b) False or misleading information has been provided to the CBB, or significant information which should have been provided to the CBB has not been so provided; or
          (c) The CBB believes it necessary in order to safeguard the interests of potential investors or the CIU's participants.

        • CIU-4.1.19

          Where the CBB proposes to cancel a CIU registration pursuant to Paragraph CIU-4.1.18, it shall give the CIU operator or its appointed representative a written notice of its intention to do so and the reasons for such action, together with a description of the process for appealing such a decision.

      • Authorisation — Requirement, Process and Revocation

        • CIU-4.1.20

          Overseas domiciled CIUs that do not come under either of the categories specified in Rules CIU-4.1.1 or CIU-4.1.2 must be authorised by the CBB before being offered to investors in Bahrain.

      • Authorisation — Requirement, Process and Revocation

        • CIU-4.1.21

          The authorisation process for overseas domiciled CIUs falling under Rule CIU-4.1.20 is the same as that specified for Bahrain domiciled CIUs, in Rules CIU-1.1.5 to CIU-1.1.11. The same requirements and processes are also applicable with respect to the revocation of an authorisation (Rules CIU-1.1.15 to CIU-1.1.18).

      • Fees Payable to CBB (authorised overseas domiciled CIUs)

        • CIU-4.1.22

          No processing or annual authorisation fees are payable by overseas domiciled CIUs subject to Rule CIU-4.1.20.

    • CIU-4.2 CIU-4.2 Requirements

      • Promotion and Advertising of Overseas Domiciled CIUs

        • CIU-4.2.1

          The CBB licensee responsible for distributing an overseas domiciled retail CIU or overseas domiciled expert CIU must ensure that the CIU's prospectus (and simplified prospectus where applicable) are kept up-to-date. A most recent copy of the prospectus (and simplified prospectus where applicable) must be made available to the CBB within 30 calendar days of any revision.

        • CIU-4.2.2

          The CBB licensee responsible for distributing an overseas domiciled retail CIU or overseas domiciled expert CIU must always make available a copy of the CIU's most recent prospectus (and simplified prospectus where applicable) free of charge to any person on request.

        • CIU-4.2.3

          The CBB licensee responsible for distributing an overseas domiciled retail CIU or overseas domiciled expert CIU must provide explanations and such other information supplementary to the prospectus as may be reasonably required by a potential investor.

        • CIU-4.2.4

          The CBB licensee responsible for distributing an overseas domiciled expert CIU and overseas domiciled exempt CIU must be able to demonstrate that each of its participants falls within the definition of an expert investor or accredited investor (as appropriate). They should also be able to demonstrate that the additional risks potentially represented by an expert CIU or exempt CIU have been clearly communicated and understood by their participants.

        • CIU-4.2.5

          To demonstrate compliance with Rule CIU-4.2.4, the CBB would expect to see a written confirmation from each participant, stating that they satisfy the definition of an expert investor or accredited investor (as appropriate) and confirming they understand the higher risks involved in an expert CIU or exempt CIU. The CBB also expects supporting documentation to be kept, demonstrating that the minimum financial assets threshold specified in Rules CIU-B.5.6 and CIU-B.5.10 (as appropriate) has been satisfied, such as copies of bank or broker statements. Where the investor’s initial investment matches or exceeds the threshold, this may by itself be taken as evidence that the client meets the minimum financial asset threshold.

          Amended: July 2007

        • CIU-4.2.6

          Overseas domiciled CIUs may not be offered directly to investors in Bahrain, by non-resident persons. Only CBB licensees that are licensed either as conventional bank licensees (Volume 1 of the CBB Rulebook), Islamic bank licensees (Volume 2) or investment firm licensees (Volume 4), may offer overseas domiciled CIUs to investors in Bahrain.

        • CIU-4.2.7

          Advertisements in respect of overseas domiciled retail CIUs and overseas domiciled expert exempt CIUs must comply with the requirements applicable to their Bahrain domiciled equivalents, as specified in Section CIU-1.11.Overseas domiciled exempt CIUs must comply with the restrictions on promotions applied to Bahrain domiciled exempt CIUs (see Rule CIU-3.1.1).

          Amended: July 2007

      • Reporting to CIU Participants

        • CIU-4.2.8

          Overseas domiciled retail CIUs and overseas domiciled expert CIUs must publish and distribute to their Bahrain resident participants at least two reports in respect of each financial year. Annual reports and accounts prepared in accordance with local accounting standards must be published and distributed to Bahrain resident participants within the time scales specified by their home jurisdiction.

        • CIU-4.2.9

          Overseas domiciled retail CIUs and overseas domiciled expert CIUs must distribute to their Bahrain resident participants any other reports (such as valuation reports), where these are specified in the CIU's prospectus.

      • CBB Reporting

        • CIU-4.2.10

          The CBB licensee responsible for distributing an overseas domiciled retail expert CIU and overseas domiciled expert CIU must file copies of the reports required under Rule CIU-4.2.8 with the CBB, within the same time periods.

          Amended: July 2007

        • CIU-4.2.11

          The CBB licensee responsible for distributing an overseas domiciled exempt CIU must file with the CBB all annual and interim reports produced by the CIU (within the time scales specified in Rule CIU-4.2.8).

        • CIU-4.2.12

          The CBB licensee responsible for distributing an overseas domiciled CIU must notify the CBB in a timely manner of any intention to merge, transfer, wind up or suspend dealings in the CIU.

        • CIU-4.2.13

          The CBB licensee responsible for distributing an overseas domiciled CIU must file with the CBB Form CIU (QS), the CIU Quarterly Statistical Return, within the deadline specified on the return.