Home / CY AIF Law of 2018 / PART VIII: REGISTERED ALTERNATIVE INVESTMENT FUNDS / Chapter 2: RAIF Operation / [141] Mergers between RAIFs.

141. Mergers between RAIFs.

(1) The merger of a RAIF, within the meaning of article 85, is allowed with an existing RAIF or when the merger results in the establishment of a new RAIF, under the condition that all RAIFs participating in the merger have the same legal form.

(2) The decision regarding the merger of the RAIF shall be taken by the unitholder’s general meeting∙ when investment compartments are merged, the unitholders of the investment compartments shall take the decision.

(3) The external managers of the RAIFs shall draw up the common terms of the merger, which shall include the terms subject to which the merger will occur∙ the terms of the merger shall be drawn up in either in an official language of the Republic, or in English and shall include the information of article 88(1)∙ the terms of the merger shall be communicated to the unitholders through a durable medium, in accordance with the fund rules or instruments of incorporation of the RAIF, and shall also be submitted to the Securities and Exchange Commission.

(4) The depositaries of the RAIFs which participate in the merge, shall verify the compliance of the information provided for in article 89 and the provisions of article 91 shall apply.

(5) Each unitholder of the RAIF has the right to request, without any additional charges than those retained by the AIF to meet the cost of divestment∙ the unitholders may exercise this right after they are notified of the terms of the merger and until five (5) working days prior to the anticipated execution date:

It is provided that, the fund rules or instruments of incorporation of the RAIF may specify that the right of redemption of a unitholder may not be exercised during the merger of the RAIF.

(6) The external manager may decide that the issue of units is suspended from the date unitholders are notified of the terms of the merger and until the execution of the merger∙ such decision shall be included in the terms of the merger.

(7) The external managers of the RAIFs participating in the merger shall be responsible for the provision of information, by the RAIFs, to their unitholders enabling them to -

(a) take a decision regarding the merger, having full knowledge of the situation, impact and consequences of the merger, and

(b) exercise their rights regarding the decision for the merger and, as the case may be, for the redemption of their units in accordance with section (5).

(8)(a) The provisions of article 93 shall apply with regards to the expenses relating to the merger, while the effects of the merger occur in accordance with articles 94 and 95∙ article 96 shall also apply.

(b) The unitholders of the RAIF participating in the merger, and which operate in the form of a limited partnership, maintain their capacity as limited partners in the RAIF created after the merger took place, and at least one of the general partners of the RAIFs shall maintain his capacity as general partner.

(9) When the merger does not result in the creation of a new RAIF, the procedure for the establishment of a RAIF shall be followed and the RAIF which still exists after the merger is effected shall amend its fund rules or instruments of incorporation, so that the merger is explicitly referred in them. 

(10) The Securities and Exchange Commission may, by means of a directive, regulate any technical matter or detail relating to the application of this article.