Home / CY AIF Law of 2018 / PART ΙΙ: PROVISIONS REGARDING THE ALTERNATIVE INVESTMENT FUNDS / Chapter 8: Special provisions / Part 1 - Common fund / [51] Common fund rules.

51. Common fund rules.

(1) The fund rules of the common fund shall be a single document even when the common fund is an umbrella AIF The fund rules are prepared by its external manager and approved by the Securities and Exchange Commission.

(2) With its subscription in units of the common fund, the unitholder is presumed to have accepted the common fund rules.

(3) The common fund rules, which are also signed by the depositary, where one is appointed, shall contain at least:

(a) the name of the common fund, its external manager and the name of its depositary;

(b) the investment objective of the common fund, from which the investment goals and its investment policy are determined;

(c) the category of investors to which it is addressed;

(d) the duration of the common fund or the reference that its duration is indefinite;

(e) the valuation principles and valuation policies of its assets, the rules for the calculation of its net asset value, of the issue and redemption or repurchase price and the way of disclosing these prices to the investors; where the common fund is managed by an AIFM, the additional information referred to in article 19(1) and (2) of the Alternative Investment Fund Managers Law;

(f) the conditions for the issue, marketing, cancellation and redemption or repurchase of units and the conditions under which the redemption or repurchase of the units may be suspended and reference to the fact that the suspension, redemption or repurchase may be decided by the Securities and Exchange Commission at its own initiative;

(g) the duration of the financial year and its closing date;

(h) the remuneration and commissions of the external manager of the common fund and its depositary as well as the method of calculation of the above remuneration and commissions;

• the expenses charged on the common fund;

(j) the rules of the distribution of the common fund’s proceeds and profits to the unitholders and in particular the time and procedure of the distribution;

(k) the procedure of the amendment of the common fund rules;

(l) the reasons for the dissolution of the common fund;

(m) a term forbidding the issuance of bearer units.

(4)(a) The common fund rules are amended by its external manager and the amendment shall also be signed by the depositary and approved by the Securities and Exchange Commission.

(b) The valid amendments of the fund rules are immediately communicated to the unitholders, whom they bind.

(5) In case the common fund is of the open-ended type, the unitholders have the right to request the redemption or repurchase of their units in accordance with the provisions of the rules prior to their amendment -

(a) within ten (10) calendar days from the notification of the amendment to them, where the redemption or repurchase of units takes place on a daily basis;

(b) within one (1) month from the notification of the amendment to them, where the redemption or repurchase of units takes place, at least, weekly;

(c) by the date at which the one after the next scheduled date of redemption or repurchase of units shall take place, where the redemption or repurchase takes place on a monthly basis; and

(d) by the next scheduled redemption or repurchase date, in every other case, on the condition that between the notification of the amendment to the unitholders and the expiry of the right of redemption or repurchase of their units according to the provisions of the rules prior the amendment, there is a time period of, at least, thirty (30) days.

(6) In case the common fund is of the closed-ended type, the unitholders have the right to request the redemption or repurchase of their units in accordance with the provisions of the fund rules prior to their amendment, within three (3) months from the date of the notification of the amendment to them.

(7) The common fund rules shall be drawn up in an official language of the Republic or in an official language of the Republic and in English or only in English, if the information of article 12 regarding the authorisation of the common fund has been submitted to the Securities and Exchange Commission only in English in accordance with article 12(7).