Investment Limited Partnerships (Amendment) Act 2020

PART 1 Preliminary and General

1. Short title and commencement

1. (1) This Act may be cited as the Investment Limited Partnerships (Amendment) Act 2020.

(2) This Act shall come into operation on such day or days as the Minister for Finance may by order or orders appoint either generally or with reference to any particular purpose or provision and different days may be so appointed for different purposes or different provisions.

2. Collective citation

2. (1) The Investment Limited Partnerships Act 1994 and Part 2 may be cited together as the Investment Limited Partnerships Acts 1994 and 2020.

(2) The Irish Collective Asset-management Vehicles Act 2015 and Part 3 may be cited together as the Irish Collective Asset-management Vehicles Acts 2015 and 2020.

(3) The Investment Funds, Companies and Miscellaneous Provisions Act 2005 and Part 4 may be cited together as the Investment Funds, Companies and Miscellaneous Provisions Acts 2005 and 2020.

3. Definitions

3. In this Act—

“Act of 1994” means the Investment Limited Partnerships Act 1994;

“Act of 2005” means the Investment Funds, Companies and Miscellaneous Provisions Act 2005;

“Act of 2015” means the Irish Collective Asset-management Vehicles Act 2015.

PART 2 Amendment of Act of 1994

4. Amendment of section 3 of Act of 1994

4. Section 3 of the Act of 1994 is amended—

(a) by the insertion of the following definitions after the definition of “the Act of 1890”:

“ ‘Act of 2010’ means the Criminal Justice (Money Laundering and Terrorist Financing) Act 2010;

‘alternative foreign name’ shall be construed in accordance with section 8(4B);”,

(b) by the insertion of the following definitions after the definition of “the Bank”:

“ ‘beneficial owner’, in relation to an investment limited partnership, means any individual who—

(a) ultimately is entitled to or controls, whether the entitlement or control is direct or indirect, more than a 25 per cent share of the capital or profits of the partnership or more than 25 per cent of the voting rights in the partnership, or

(b) otherwise controls the partnership;

‘beneficial ownership register’ shall be construed in accordance with section 46(1);

‘central register’ shall be construed in accordance with section 50(1);

‘competent authority’ means a competent authority as that expression, by virtue of sections 60 and 61 of the Act of 2010, is to be construed for the purposes of Part 4 of that Act;

‘designated person’ has the meaning assigned to it by section 25 of the Act of 2010;”,

(c) by the substitution of the following definition for the definition of “custodian”:

“ ‘depositary’ means a person maintaining a place of business in the State, appointed pursuant to the partnership agreement, eligible to act as depositary in accordance with section 8 and discharging its functions in accordance with section 5(1)(c);”,

(d) by the insertion of the following definition after the definition of “general partner”:

“ ‘Higher Executive Officer’ means the position of Higher Executive Officer, or a position equivalent to it, in the public body concerned;”,

(e) by the substitution of the following definition for the definition of “limited partner”:

“ ‘limited partner’ means a person who has been admitted to an investment limited partnership as a limited partner (or as a category of such a partner) in accordance with the partnership agreement and who shall, as provided for in that agreement and at such time or times as are specified therein, contribute or undertake to contribute a stated amount to the capital of the partnership and as provided for in section 20(1)(c), but subject to the exceptions in sections 6, 12 and 38(4), shall not be liable for the debts or obligations of the investment limited partnership beyond the amount so contributed or undertaken;”,

(f) by the insertion of the following definition after the definition of “limited partner” (inserted by paragraph (e)):

“ ‘Member State’ means a Member State of the European Union and, where relevant, includes a contracting party to the Agreement on the European Economic Area signed at Oporto on 2 May 1992 (as adjusted by the Protocol signed at Brussels on 17 March 1993);”,

(g) in the definition of “partnership agreement”, by the deletion of “exclusive”,

(h) by the insertion of the following definitions after the definition of “partnership agreement”:

“ ‘PPS number’, in relation to an individual, means the individual’s Personal Public Service Number within the meaning of section 262 of the Social Welfare Consolidation Act 2005;

‘presenter’ shall be construed in accordance with section 53(1);

‘Principal Officer’ means the position of Principal Officer, or a position equivalent to it, in the public body concerned;

‘senior managing official’ includes a director and a chief executive officer;”,

and

(i) by the substitution of the following definition for the definition of “the Minister”:

“ ‘the Minister’ means the Minister for Finance.”.

5. Replacement of “custodian” with “depositary”: miscellaneous amendments of Act of 1994

5. (1) The following provisions of the Act of 1994, namely:

(a) each provision of it specified in column (2) of the Table, opposite the mention in column (1) of the Table of the section of that Act which contains that provision;

(b) section 36,

are amended by the substitution of “depositary” for “custodian” in each place where that expression occurs in that provision.

(2) The foregoing reference to the expression “custodian” includes a reference to that expression where it occurs in the plural form and where it occurs in the latter form, “depositaries”, is, by virtue of subsection (1), substituted for it.

Table

Section of Act of 1994 (1)	Provision of Section Mentioned in Column Opposite (2)
Section 5	Subsection (1)(c) and (d)
Section 6	Subsection (4)(e)(v)
Section 7	Subsection (2)(b); subsection (4)(c) and (d) and subsections (5) and (7)
Section 8	Subsection (1)(c); subsection (2) and subsection (4A)(f)
Section 11	Subsection (3)
Section 16	Subsection (11)
Section 24	Subsection (1)(a), (b) and (c) and subsections (2), (3) and (5)
Section 25	Subsection (1) and paragraphs (i), (ii), (iii), (iv) and (v) of the definition of “associated undertaking” in subsection (4)(a)
Section 26	Subsection (2)(d); subsection (4) and paragraphs (a), (b), (c), (d) and (e) of subsection (7)
Section 27	Subsection (1)
Section 29	Subsection (1)(c) and subsection (2)
Section 30	Subsections (1), (2) and (3)
Section 31	Subsections (1), (3) and (4)
Section 32	Subsection (1); subsection (2)(c) and subsection (4)
Section 33	Subsection (1); subsections (2) and (5) and paragraphs (a), (c) and (e) of subsection (10)
Section 34	Subsections (1) and (4)

6. Amendment of section 5 of Act of 1994

6. Section 5 of the Act of 1994 is amended—

(a) in subsection (3), by the substitution of “fair and appropriate value of the property” for “fair market value of the property”, and

(b) by the insertion of the following subsections after subsection (4):

“(5) An investment limited partnership may be established as an umbrella fund, that is to say as an investment limited partnership which is divided into a number of sub-funds (within the meaning of the Schedule).

(6) The provisions of the Schedule shall have effect for the purposes of subsection (5).”.

7. Amendment of section 6 of Act of 1994

7. Section 6 of the Act of 1994 is amended—

(a) in subsection (4) —

(i) in paragraph (e) —

(I) in subparagraph (vi), by the substitution of “limited partners;” for “limited partners.”, and

(II) by the insertion of the following subparagraph after subparagraph (vi):

“(vii) a decision to approve an alteration in the partnership agreement;”,

and

(ii) by the insertion of the following paragraph after paragraph (e):

“(f) any of the following:

(i) serving on any board or committee (such as an advisory committee) of the investment limited partnership, or established by, or as provided for in the partnership agreement in respect of, a general partner, the limited partners or the partners generally;

(ii) appointing, electing or otherwise participating in the choice of a representative or any other person to serve on any such board or committee;

(iii) acting as a member of any such board or committee either directly or by or through any representative or other person, including giving advice in respect of, or consenting or refusing to consent to, any action proposed by the general partner on behalf of the investment limited partnership and exercising any powers or authorities or performing any obligations as a member of any such board or committee in the manner contemplated by the partnership agreement.”,

and

(b) by the insertion of the following subsection after subsection (4):

“(5) Without prejudice to the generality of the provision made by subsection (4) in relation to acts, on the part of a limited partner, that do not constitute the limited partner taking part in the conduct of the business of an investment limited partnership, neither—

(a) the reference in section 38(4) to any limited partner holding himself or herself out as conducting or purporting to conduct the business of an investment limited partnership, nor

(b) the reference in section 39 to a limited partner purporting to take part in the conduct of the business of an investment limited partnership,

shall be construed as including a reference to the limited partner, in and of itself, holding himself or herself as doing, or purporting to do, one or more of the acts specified in subsection (4) (irrespective of the frequency with which that holding out, or that purported doing of the act or acts concerned, occurs).”.

8. Amendment of section 8(4) of Act of 1994

8. Section 8(4) of the Act of 1994 is amended by the substitution of the following paragraph for paragraph (a):

“(a) the fee prescribed under section 32E of the Central Bank Act 1942 for the purposes of this subsection, and”.

9. Amendment of section 8(4A) of Act of 1994

9. Subsection (4A) (inserted by the Central Bank and Financial Services Authority of Ireland Act 2003) of section 8 of the Act of 1994 is amended—

(a) by the substitution of “for the purposes of subsection (4)(c) ” for “for the purposes of subsection (4)(b) ”,

(b) by the substitution of the following paragraph for paragraph (a):

“(a) the name and, if any, the alternative foreign name (and, in the case of the latter, a translation of it into the English language) of the investment limited partnership;”,

(c) in paragraph (e), by the substitution of “a statement, if applicable, that the proposed general partner has complied with the requirements of section 1302 of the Companies Act 2014, and its registration number” for “a statement that proposed general partner has complied with the requirements of section 352 of the Companies Act 1963, and its registration number”, and

(d) in paragraph (f), by the deletion of “and address”.

10. Provision for alternative foreign name - amendment of section 8 of Act of 1994

10. Section 8 of the Act of 1994 is amended by the insertion of the following subsection after subsection (4A):

“(4B) The reference in subsection (4A)(a) to an alternative foreign name is a reference to a particular name that is specified in the application to be such a name in respect of the investment limited partnership and this subsection confers power on an investment limited partnership to have such a name and the following apply to the name so specified:

(a) the name, as regards any territory, district or place not situate in the State, may be used, instead of the first-mentioned name in subsection (4A)(a), in relation to any act (by or in respect of the partnership), whether that act is performed within or outside the State;

(b) the name may consist of any letters, characters, script, accents or other diacritical marks that do not utilise the Roman alphabet, and does not need to be a translation or transliteration of the first mentioned name in subsection (4A)(a).”.

11. Supplemental amendment of section 8 of Act of 1994

11. Section 8 of the Act of 1994 is amended by the insertion of the following subsection after subsection (8):

“(8A) In addition to the power to refuse to authorise an investment limited partnership under the preceding, or any other provision, of this section, the Bank may refuse to authorise an investment limited partnership if, in the opinion of the Bank, the name that is specified in the application to be an alternative foreign name in respect of the partnership is undesirable, but an appeal against a refusal so to authorise shall lie to the Court.”.

12. Amendment of section 10 of Act of 1994

12. The Act of 1994 is amended by the substitution of the following section for section 10:

“Records of investment limited partnership and statements filed

10. The Bank shall maintain a record of each investment limited partnership authorised under this Act and of all statements, the subject of a filing, return or other submission made in accordance with this Act with or to the Bank, in relation to such investment limited partnership.”.

13. Cases in which partnership agreement may be altered - amendment of section 11(1) of Act of 1994

13. Section 11 of the Act of 1994 is amended by the substitution of the following subsection for subsection (1):

“(1) No alteration in a partnership agreement shall be made unless the alteration has been approved by means of an instrument in writing signed by or on behalf of every partner to the partnership agreement, but this is subject to subsections (1A) and (1B).

(1A) Notwithstanding subsection (1), where the partnership agreement so stipulates, an alteration in a partnership agreement may be made if—

(a) every partner to the partnership agreement has been given notice, in accordance with the provisions of the partnership agreement in that behalf, of the proposed alteration, and

(b) the alteration is approved by means of an instrument in writing signed by or on behalf of a majority of the partners to the partnership agreement.

(1B) Notwithstanding subsection (1), an alteration in a partnership agreement may be made if the depositary of the partnership has certified in writing that the alteration does not prejudice the interests of the limited partners, but only where the following conditions are satisfied:

(a) the matter to which the alteration relates is not a matter as respects which the Bank specifies that an alteration may be made only if the alteration is approved by the means referred to in subsection (1)(which specification the Bank is empowered by this paragraph to make);

(b) the partnership agreement confers a power on the depositary of the investment limited partnership to so certify that the alteration does not prejudice the foregoing interests,

and if the partnership agreement contains a stipulation, as referred to in subsection (1A), that fact does not preclude the application of this subsection and if the partnership agreement confers a power on the depositary, as referred to in paragraph (b), that fact does not preclude the application of subsection (1A).

(1C) For the purpose of subsection (1A)(b), a majority of the partners to the partnership agreement shall be regarded as comprising the sum of—

(a) the number of general partners that constitute the majority of general partners who have approved the alteration by the means there referred to, and

(b) the number of limited partners that constitute the majority of limited partners who have approved the alteration by the means there referred to, and subsection (2) of section 19A applies for the purpose of this paragraph as it applies, in the circumstances and to the extent provided in subsection (1) of that section, for the purpose of the matters referred to in that subsection (2).”.

14. Amendment of section 11 of Act of 1994 - insertion of additional subsections

14. Section 11 of the Act of 1994 is amended by the insertion of the following subsections after subsection (4):

“(5) On—

(a) the admission of any general partner or general partners (who or each of whom is referred to in this subsection as an ‘incoming general partner’), or

(b) the replacement, for a general partner or general partners, by another general partner or general partners (who or each of whom is also referred to in this subsection as an ‘incoming general partner’),

in accordance, in either case, with the terms of the partnership agreement and this Act, all rights or property of every description of the investment limited partnership, including all choses in action and any right to make capital calls and receive the proceeds thereof, held or deemed to be held by the general partner or general partners (who or each of whom is referred to in this subsection as an ‘existing general partner’) and all obligations, claims, debts and liabilities of the investment limited partnership to which the existing general partner or partners is or are subject shall vest without the requirement for further formalities in the incoming general partner and any continuing existing general partner and shall be held or owed, as appropriate, by that partner or those partners in accordance with the partnership agreement and this Act.

(6) On the withdrawal of a general partner in accordance with the terms of the partnership agreement and this Act—

(a) all rights or property of every description of the investment limited partnership, including all choses in action and any right to make capital calls and receive the proceeds thereof, held or deemed to be held by the general partner or general partners shall vest without the requirement for further formalities in the remaining general partner or general partners and shall be held by that partner or those partners in accordance with the partnership agreement and this Act, and