Property authorised investment funds (Property AIFs): process and effects of entry into the Property AIF regime: giving notice to enter
An open-ended investment company (OEIC) that meets all the conditions of entry, and intends to enter the regime, does so by giving notice under regulation 69O SI 2006/964. The notice must be submitted in writing in order to fulfil the notification condition but the OEIC will also need to comply with the conditions set out below.
For an existing OEIC: The manager must obtain any necessary shareholder and regulatory consent to change as required by its instrument of incorporation and its prospectus before giving notice.
The appointed fund manager must confirm in writing that the property investment business condition (regulation 69E SI 2006/964 and CTM48813), the genuine diversity of ownership condition (regulation 69J SI 2006/964 and CTM48816), and the corporate ownership condition (regulation 69K SI 2006/964 and CTM48817) have been met and that each of the conditions for entry into and membership of the regime are reasonably expected to be met in the specified accounting period (regulation 69Q(3)(a) SI 2006/964).
Unless prior clearance in respect of the genuine diversity of ownership condition has been obtained from HMRC (see CTM48824), the notice must be given at least 28 days before the start of the first accounting period in which the regime is to apply (regulation 69P(2) SI 2006/964). Accounting period is defined in section 12 ICTA.
The notification must specify the accounting period from the first day of which the Property AIF regime is to apply and must be accompanied by:
- the instrument of incorporation and prospectus (including any supplements to the prospectus), and
- a copy of the application to the Financial Services Authority (FSA) for agreement to changes in the company’s instrument of incorporation and its prospectus, including any supplementary documents, together with copies of any documents supporting that application.
A notice may be amended or withdrawn at any time before it is due to take effect but the notice period will recommence after any alteration, unless HMRC waive this. HMRC can waive the extension of the period if it is satisfied that the amended notice is valid before the original effective date (regulation 69P(6) SI 2006/964). Failing this, the earliest date which the amended notice can take effect is 28 days (or 42 days for a proposed OEIC - see below) after the amendment is received by HMRC.
If a manager of an OEIC seeks and receives clearance in advance from HMRC that it meets or will meet the genuine diversity of ownership condition and the manager of the OEIC certifies that no changes have been made or are proposed in the documents sent for clearance, then notice may be given at any time before the start of the first accounting period.
For a proposed OEIC: The manager launching the fund must give notice as above at least 42 days before the date of the expected incorporation and authorisation. The notification must be accompanied by:
- its proposed instrument of incorporation and prospectus (including any supplements to the prospectus),
- a copy of the application to the FSA for approval, and
- any other documents supporting the application to the FSA.
Where should notices be sent to?
Notices should be sent to:
Authorised Investment Funds Centre
Local Compliance Eastern England
5 Young Street