S.I. No. 420/2015 - Central Bank (Supervision and Enforcement) Act 2013 (Section 48(1)) (Undertakings for Collective Investment in Transferable Securities) Regulations 2015

“expenditure requirement” means one quarter of a depositary’s total expenditure as set out in the most recent annual audited accounts;

“minimum capital requirement” means the higher of the initial capital requirement and the expenditure requirement;

“total expenditure” means all expenditure incurred by a firm.

2 Calculating “Total Expenditure”

For the purposes of the minimum capital requirement report:

• (a) the following may be deducted from the figure for total expenditure:

• (i) depreciation;

• (ii) profit shares, bonuses;

• (iii) net losses arising in the translation of foreign currency balances;

• (iv) shared commissions paid (other than to officers and staff of the depositary) that have been paid with the prior agreement of the Bank; and

• (v) exceptional and extraordinary non-recurring expense items that have been paid with the prior agreement of the Bank; and

• (b) every deduction from the figure for total expenditure shall be either:

• (i) identified clearly in the most recent annual audited accounts; or

• (ii) supported by a letter from the auditor of the UCITS confirming the relevant figure.

3 Financial Resources

A depositary shall have financial resources at least equal to its Minimum Capital Requirement.

Financial Resources are calculated as the aggregate of:

• (a) Fully paid in equity capital;

• (b) Perpetual non-cumulative preference shares;

• (c) Eligible Capital Contributions pursuant to paragraph 4 of this Schedule;

• (d) Subordinated Loan Capital pursuant to paragraph 4 of this Schedule;

• (e) Share premium accounts;

• (f) Disclosed revenue and capital reserves (excluding revaluation reserves);

• (g) Interim net profits (may only be included if they have been audited); and

• (h) Other reserves.

Less

Current year losses not included in disclosed revenue and capital reserves specified in paragraph 3(a) — (h) of this Schedule.

4 Eligible Capital Contributions and Subordinated Loan Capital (both Perpetual and Redeemable)

The following conditions apply to eligible capital contributions and to subordinated loan capital (both perpetual and redeemable):

• (a) the prior approval of the Bank must be obtained in respect of the inclusion of the eligible capital contribution or subordinated loan capital in the financial resources for capital adequacy purposes

• (b) subordinated loan capital may not be incorporated in the calculation of the initial capital requirement;

• (c) the Bank must be provided with documentation, including a copy of the original bank statement showing receipt of the relevant funds, that the depositary has received the eligible capital contribution or subordinated loan capital or both (as the case may be);

• (d) the Bank may require the auditor of the depositary to confirm the receipt of additional capital;

• (e) the depositary must use (as the case may be) the template capital contribution agreement, perpetual loan subordination agreement or loan subordination agreement (for redeemable subordinated loan capital), each without amendment, that the Bank may specify and make available, including on the Bank’s website, from time to time;

5 Redeemable Subordinated Loan Capital

Without prejudice to paragraph 4 of this Schedule, the following conditions also apply to redeemable subordinated loan capital:

• (a) the extent to which redeemable subordinated loan capital ranks as a financial resource, for the purposes of calculating financial resources, will be reduced on a straight-line basis over the five years immediately preceding the repayment date;

• (b) the qualifying amount of redeemable subordinated debt is calculated as follows:

Remaining term to maturity __

Gross Amount __

Less Amortisations __

= Qualifying Amount __

6 Eligible Assets

• (a) An eligible asset must be:

• (i) accessible easily;

• (ii) free from any lien or charge; and

• (iii) maintained outside the depositary’s group.

• (b) The eligible assets, shall be held in an account that is separate to the account that is, or the accounts that are, used by a depositary for the day-to-day running of its business.

• (c) The Bank must be provided with a recent written statement, from a source independent of the depositary, evidencing the location of every eligible asset.

• (d) Eligible assets are calculated as the value of total assets of the depositary less the aggregate value of the items of the depositary that are set out in clauses (i) to (xi):

• (i) fixed assets,

• (ii) intangible assets,

• (iii) cash or cash equivalents held with group companies,

• (iv) debtors,

• (v) bad debt provisions,

• (vi) prepayments,

• (vii) intercompany amounts (gross),

• (viii) loans issued,

• (ix) investment funds that are not daily dealing,

• (x) investments in any investment fund that is promoted by a group company of the depositary or to which a group company of the depositary provides services, and

• (xi) any other asset that is not accessible easily and which is not included in clauses (i) to (x),

where “total assets” are non-current assets plus current assets.

SCHEDULE 10

Regulation 97

Managerial functions of the Management company

The board of a management company shall be responsible for the following managerial functions:

• (a) Regulatory compliance: The board shall put in place, and ensure adherence to, procedures designed to ensure compliance with all applicable legal and regulatory requirements of the management company itself and all investment funds under management. The board shall have arrangements in place to ensure that complaints from unitholders regarding matters other than distribution are addressed promptly and effectively;

• (b) Fund risk management: The board shall put in place, and ensure adherence to, procedures designed to ensure that all applicable risks pertaining to the investment funds under management can be identified, monitored and managed at all times;

• (c) Operational risk management: The board shall put in place, and ensure adherence to, procedures designed to ensure that all applicable risks pertaining to the management company can be identified, monitored and managed at all times;

• (d) Investment management: The board shall put in place, and shall ensure adherence to, procedures to

• (i) ensure and verify that the investment approach of each investment fund is complied with; and

• (ii) ensure availability of up to date information on portfolio performance;

• (e) Capital and financial management: The board shall put in place, and ensure adherence to, procedures to ensure compliance with regulatory capital requirements of the management company. The board shall put in place, and ensure adherence to, procedures to ensure all relevant accounting records of the management company and of the investment funds under management are properly maintained and are readily available, including production of annual and half-yearly financial statements. The board shall put in place, and ensure adherence to, procedures to ensure that proper accounting policies and procedures are employed in respect of the management company and all investment funds under management.

• (f) Distribution: The board shall put in place, and shall ensure adherence to, procedures to ensure and verify that the distribution strategy of each investment fund is complied with. The board shall have arrangements in place to ensure that complaints from unitholders regarding distribution matters are addressed promptly and effectively.

SCHEDULE 11

Regulation 104

Records of a Management company

The types of material and level and nature of content for the purposes of Regulation 104 are:

1 Financial Materials

• (a) details of all money received and expended by the management company whether on its own behalf or on behalf of any investment fund that is under its management, together with details of how such receipts and payments arose;

• (b) a record of all income and expenditure of the management company explaining its nature;

• (c) a record of all assets and liabilities of the management company, long and short positions and off-balance sheet items, including any commitments or contingent liabilities;

• (d) details of all purchases and sales of investment instruments by the management company distinguishing those that have been made by the management company on its own account and those that have been made on behalf of any investment fund that is under its management;

• (e) any working papers that are necessary to show the preparation of any return that has been submitted to the Bank.

2 Management Information

Management information records maintained in a manner such that they disclose, or are capable of disclosing, in a prompt and appropriate manner, the financial and business information that will enable the management company to:

• (a) identify, quantify, control and manage the management company’s risk exposures;

• (b) make timely and informed decisions;

• (c) monitor the performance of all aspects of the management company’s business on an up-to-date basis; and

• (d) monitor the quality of the management company’s assets.

3 Company Secretarial Material

• (a) the share register;

• (b) the register of interests of directors and the secretary;

• (c) copies of the signed minutes of meetings of the board of directors;

• (d) every other statutory document that the management company is, by statute, required to maintain.