MUTUAL FUND ACT, 1997

PART III - MUTUAL FUND ADMINISTRATOR

7. A person shall not carry on business as a mutual fund administrator in or from within Seychelles except under and in accordance with a licence under this Act.

8.(1) An application for a licence to carry on business as a mutual fund administrator -

(a) shall be made to the Authority in the form provided by the Authority;

(b) shall be accompanied by -

(i) information necessary to satisfy the Authority as provided under subsection (2);

(ii) the prescribed fees;

(2) The Authority shall not grant a licence to a mutual fund administrator unless the Authority is satisfied that it is a company and -

(a) it has its registered office or a principal place of business in Seychelles;

(b) it has a fully paid up share capital of -

(i) not less than such amount as may be prescribed; or

(ii) not less than such other amount as may be prescribed and liability insurance cover of not less than such amount as may be prescribed with a reputable insurer acceptable to the Authority;

(c) it has at least 2 directors approved by the Authority;

(d) in the case of a company which is not incorporated in Seychelles, it has 2 individuals resident in Seychelles to be its agents in Seychelles;

(e) it has the necessary expertise to administer mutual funds;

(f) it is of sound reputation;

(g) it will administer mutual funds in a proper manner;

(h) its name is not identical to or does not nearly resemble, as to be likely to deceive, the name of a company, corporation, firm, business or other entity, whether or not within Seychelles;

(i) its name is not likely to suggest, falsely, that it has a special status in relation to or derived from the Government or the Republic;

(j) its name is not likely to suggest, falsely, the patronage of or connection with some person or authority, whether or not within Seychelles;

(j) its name does not contain a word or expression the use of which is prohibited under any written law.

(3) The Authority may grant a licence to a mutual fund administrator subject to such condition as the Authority considers appropriate.

(4) The Authority may, on the application of a licensed mutual fund administrator, waive, vary or revoke any condition of its licence.

(5) Each operator and senior officer of a licence mutual fund administrator shall ensure that the mutual fund administrator complies with the conditions of the licence.

(6) An agent of a mutual fund administrator referred to in subsection (2)(d) shall be deemed, for the purposes of this Act, to have all the functions of a director of the mutual fund administrator under this Act and to have the power to accept service of any notice or process under the laws of Seychelles on behalf of the mutual fund administrator.

9.(1) A licensed mutual fund administrator shall not -

(a) issue shares,

(b) appoint a director, general manager or other senior officer of the mutual fund administrator,

(c) change the address of its registered office or principal place of business in Seychelles, or

(d) where it is an overseas company, change any individual acting as its agent in Seychelles, unless it has obtained the prior written approval of the Authority.

(2) A person owning shares or having an interest in shares in a licensed mutual fund administrator shall not transfer or otherwise dispose of or deal in the shares or interest without the prior written approval of the Authority.

(3) Sub-sections (1) and (2) shall not apply to a licensed mutual fund administrator which is licensed to carry on business as a financial institution under the Financial Institutions Act or to carry on insurance business under the Insurance Act.

10. Where the Authority is satisfied that -

(a) there is reasonable cause to require a licensed mutual fund administrator to do so, or

(b) the fully paid-up share capital of a licensed mutual fund administrator is less than the relevant prescribed amount,

the Authority may direct the mutual fund administrator -

(c) to provide such guarantees or insurance cover or other financial support as the Authority may think fit, or

(d) to increase its fully paid-up share capital to such amount as the Authority considers appropriate,

and the mutual fund administrator shall comply with the direction.

11.(1) A licensed mutual fund administrator shall immediately upon starting to provide the principal office to a mutual fund give the Authority the prescribed details in respect of the mutual fund.

(2) A licensed mutual fund administrator shall not provide a principal office to a mutual fund unless -

(a) the mutual fund is licensed under this Act;

(b) the mutual fund administrator is satisfied that -

(i) each promoter of the mutual fund is of sound reputation;

(ii) the administration of the mutual fund will be undertaken by persons who -

A. have sufficient expertise to administer the mutual fund; and

B. are of sound reputation; and

(iii) the business of the mutual fund and any offer of equity interest in it will be carried out in a proper manner.

(3) A licensed mutual fund administrator which knows or has reason to believe that a licensed mutual fund of which it is the administrator or for which it provides a principal office, or a promoter or operator of the mutual fund -

(i) is or is likely to become unable to meet its obligations as they fall due,

(ii) is carrying on business otherwise than in accordance with this Act or any other written law,

(iii) is carrying on business in a manner that is or is likely to be prejudicial to investors or creditors of the mutual fund,

(iv) is carrying on business in a manner that is or is likely to be prejudicial to the good repute of Seychelles,

the mutual fund administrator shall immediately give the Authority notice of that knowledge or belief and of the reasons for the knowledge or belief.

(4)A licensed mutual fund administrator shall pay -

(a) the prescribed annual fee for each mutual fund for which it is providing a principal office, and

(b) the prescribed annual fee in respect of its own licence.

12. (1) A licensed mutual fund administrator shall have its accounts audited at the end of its financial year by an auditor.

(2) A licensed mutual fund administrator shall send its audited accounts for a financial year to the Authority within 4 months of the end of the financial year or within such extension of that period as the Authority may allow.