Jersey R & O 10/2001
Financial Services (Jersey) Law 1998
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FINANCIAL
SERVICES (INVESTMENT BUSINESS (RESTRICTED INVESTMENT BUSINESS - EXEMPTION))
(JERSEY) ORDER 2001
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THE FINANCE AND ECONOMICS COMMITTEE, in pursuance of Articles 4(1)(a)(i) and
6(2)(a)(ii) of the Financial Services (Jersey) Law 1998, as amended, and on the
recommendation of the Jersey Financial Services Commission orders as follows -
Interpretation
1.-(1)
In this Order -
“Commission”
means the Jersey Financial
Services Commission;
“Law” means the
Financial Services (Jersey) Law 1998;
“professional
investor regulated scheme” has the meaning given to that expression by Article
3;
“restricted
investment business” has the meaning given to that expression by Article 2.
(2) A reference in this Order to an enactment is a reference to that
enactment as amended by any subsequent enactment.
(3) A reference in this Order to a numbered Article without further
identification is a reference to the Article so numbered in this Order.
(4) A reference in an Article to a paragraph, sub-paragraph or
clause by number or letter only, and without further identification, is a
reference to the paragraph, sub-paragraph or clause of that number or letter in
the Article of this Order in which the reference occurs.
Meaning of “restricted investment business”
2.-(1) In this Order
“restricted investment business” means the carrying on of all or any of the
following activities by way of business -
(a) dealing in investments in relation to a
professional investor regulated scheme, that is, buying, selling, subscribing
for or underwriting investments, either as principal or as agent;
(b) dealing in investments in relation to
investors in a professional investor regulated scheme, that is buying or
selling investments, either as principal or agent;
(c) discretionary investment management, that
is, deciding as agent to buy, sell, subscribe for or underwrite investments for
or on behalf of a professional investor regulated scheme;
(d) giving investment advice to a professional
investor regulated scheme, that is, giving advice on the merits of -
(i) the purchase, sale, subscription for or
underwriting of a particular investment; or
(ii) the exercise of rights, conferred by an
investment, to acquire, dispose of, underwrite or convert an investment.
(2) In paragraphs (1)(a) and(b) -
(a) “buying” includes any acquisition;
(b) “selling” includes any disposal.
(3) In paragraph (2)(b) “disposal” includes -
(a) in the case of an investment consisting of
rights under a contract or other arrangements, assuming the corresponding
liabilities under the contract or arrangements;
(b) in the case of any other investment,
issuing or creating the investment or granting the rights or interests of which
it consists;
(c) in the case of an investment consisting of
rights under a contract, surrendering, assigning or converting those rights.
Meaning of “professional investor regulated scheme”
3.-(1) In this Order “professional
investor regulated scheme” means an investment scheme referred to in paragraph
(2) or (3).
(2) An investment scheme securities in which
were in issue 1st July 1999 is a “professional investor regulated scheme” if -
(a) the relevant consent had been issued in
respect of the scheme before 1st July 1999; and
(b) each investor in the scheme, other than an
investor who held securities in the scheme before 1st July 1999, received and
signed an investment warning.
(3) An investment scheme is a “professional
investor regulated scheme” if -
(a) the relevant consent has been issued in
respect of the scheme; and
(b) each investor in the scheme -
(i) has made a minimum subscription of
£250,000 or is a professional investor; and
(ii) has received and signed an investment
warning.
(4) In this Article -
“1958
Order” means the Control of Borrowing (Jersey) Order 1958;
“functionary”
means a person who, in relation to a professional investor regulated scheme,
acts as an agent or counter-party, and includes a manager, investment manager,
advisor, investment advisor, administrator, paying agent, distributor,
subscription agent, placement agent, sales agent, dealer, trustee, custodian,
custody agent, depository or general partner of the professional investor
regulated scheme;
“investment
scheme” includes any investment arrangement;
“investment warning”, in respect of
an investor in a professional investor regulated scheme, means a warning issued
in accordance with the terms of an offer relating to the subscription, purchase
or exchange of securities made or to be made pursuant to an offer document
stating -
(a) that an investment in the
scheme is only suitable for sophisticated investors who understand the risks
involved in acquiring such an investment; and
(b) that neither the scheme nor
the activities of any functionary with regard to the scheme are subject to all
the provisions of the Financial Services (Jersey) Law 1998,
or a warning with words to the like
effect approved by the Commission;
“professional investor”, in respect
of a professional investor regulated scheme, means -
(a) a person whose ordinary
activities involve the person in acquiring, holding, managing or disposing of
investments (as principal or agent) for the purposes of the person’s business
or who it is reasonable to expect will acquire, hold, arrange or dispose of
investments (as principal or agent) for the purposes of that business; or
(b) any person who carries on
investment business in relation to the professional investor regulated scheme;
or
(c) any employee of a person
referred to in paragraph (b) who is engaged in carrying on investment business
in relation to the professional investor regulated scheme and, where the person
referred to in paragraph (b) is a company, any director of that company and,
where the person referred to in paragraph (b) is a partnership, any partner of
that partnership; or
(d) any company which is wholly
owned by, or a limited partnership all the limited partners of which are, or a
trust established for the benefit only of, one or more persons referred to in
paragraphs (b) or (c);
“relevant
consent”, in respect of an investment scheme, means -
(a) in the case of a body corporate, the
consent of the Commission under Article 3, 4, 4A or 4B of the 1958 Order to the issue of
securities in connection with the scheme or to the raising of money in Jersey
by the issue of such securities; or
(b) in the case of a unit trust, the consent of
the Commission under Article 7(1) of the 1958 Order to the issue of securities
in connection with the scheme or to the raising of money in Jersey by the issue
of such securities; or
(c) in the case of a limited partnership, the
consent of the Commission under Article 8 of the 1958 Orderto the creation of securities in connection
with the scheme or to the raising of money in Jersey by the creation of such
securities;
“securities” means bonds, notes,
commercial paper, debentures, debenture stock, instruments creating or
acknowledging indebtedness, shares, units or interests under a limited
partnership.
Exemption
4.-(1) In accordance with
Article 6(2)(a)(ii) of the Law it is declared
that the Law shall not apply to a person when, in relation to a professional
investor regulated scheme, the person -
(a) acts as a functionary; and
(b) carries on restricted investment business.
(2) In accordance with Article 4(1)(a)(i) of
the Law, it is declared
that the exemption conferred by paragraph (1) is amended so that it is limited
to Article 6 of the Law.
(3) Articles 10A, 20, 21, 22, 23, 25, 29, 30,
31, 32, 33, 34, 35, 36, and 38 of the Law shall continue
to apply to a person exempted from registration by virtue of paragraph (1) as
if the person were a registered person.
(4) A reference to registered persons in those
Articles and the reference to persons registered by the Commission in Article 5
of the Law shall be construed accordingly.
(5) In this Article “functionary” has the same
meaning as in Article 3.
Revocation
5. The
Investment Business (Exemption No. 4A) (Jersey) Order 1999 is revoked.
Citation and commencement
6. This
Order may be cited as the Financial Service (Investment Business (Restricted
Investment Business - Exemption)) (Jersey) Order 2001 and shall come
into force on the second day of February 2001.
By
Order of the Finance and Economics Committee,
C.M. NEWCOMBE
Greffier of the States.
12th January
2001.
Explanatory Note
R & O 10/2001
Financial
Services (Investment Business (Restricted Investment Business -
Exemption)) (Jersey) Order 2001
Finance
and Economics Committee
The purpose of this Order is to
revoke the Investment Business (Exemption No. 4A) (Jersey) Order 1999 (which
exempted functionaries in respect of certain regulated investment schemes
intended solely for professional or sophisticated investors from the obligation
to register under the Investment Business (Jersey) Law 1998, now called the
Financial Services (Jersey) Law 1998).
This
Order is necessary solely as a
consequence of the changes brought about by the Financial Services (Extension)
(Jersey) Law 2000. It introduces no new provisions.
The Order includes provisions by
which certain powers of the Jersey Financial Services Commission under the
Financial Services (Jersey) Law 1998 will continue to be applicable in respect
of persons exempted from registration under the Law.
The
Order was made on 12th January 2001 and comes into force on 2nd February 2001.