Home / CY AIF Law of 2018 / PART ΙΙ: PROVISIONS REGARDING THE ALTERNATIVE INVESTMENT FUNDS / Chapter 8: Special provisions / Part 3 - Limited Partnerships / [66] Limited partnership set up as internally managed AIF.
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66. Limited partnership set up as internally managed AIF.
(1) A limited partnership with separate legal personality may not appoint an external manager in the cases provided in section 6(2)(a) of the Law. Where the limited partnership has not appointed an external manager, any references in the Law to the external manager shall deem as references to the limited partner:
It is provided that the provisions of this section shall apply to AIFLNPs as if the reference to article 6(2)(a) is a reference to article 125(1)(a).
(2) In case of an internally managed AIF, which takes the form of a limited partnership-
(a) The Securities and Exchange Commission shall grant authorisation to it subject to article 13, only if it satisfies the following conditions:
the application for authorisation is accompanied by the operations manual, which includes, at least, the organisational structure of the investment company, as well as how it will comply with its obligations,
the persons who effectively direct the business of the limited partnership are of sufficiently good repute are of sufficiently good repute and possess sufficient knowledge, abilities and experience in relation to the activity they perform. For this purpose, the names of the persons who effectively direct the business of the limited partnership and of every person succeeding them in office are immediately communicated to the Securities and Exchange Commission. The business of the limited partnership is conducted by, at least, two (2) persons who meet the above mentioned conditions,
where close links exist between the limited partnership and other natural and legal persons, the Securities and Exchange Commission grants authorisation only if those close links do not prevent the effective exercise of its supervisory duties,
the limited partnership has the appropriate composition in terms of partners, the required organisational structure and staff and the appropriate economic and technical resources in order to be in the position to provide its services in accordance with the provisions of the Law; for this purpose, the Securities and Exchange Commission shall immediately be informed of the name or business name of the persons that have qualifying holdings in the limited partnership, the amount of their holdings and any information that allows the Securities and Exchange Commission to assess their suitability,
complies with article 21, which applies proportionately,
complies with section (4).
(b) subject to the conditions of paragraph (a), the provisions of articles 12 and 13 shall apply regarding the granting of authorisation to an AIF;
(c) the general partner of the limited partnership shall undertake the duties and responsibilities of the external manager, which shall appoint, at least, one (1) person responsible for the portfolio management, who meets the following conditions:
he holds academic qualifications and/or has experience related to the assets in which the AIF is allowed to invest,
he is certified to provide portfolio management service in accordance with the provisions of the Investment Services and Activities and Regulated Markets Law, as amended,
he is registered in the public register kept by the Securities and Exchange Commission, in which the persons who succeed in the exams of the Securities and Exchange Commission are registered.
(d) the limited partnership shall establish and maintain internally the legal compliance function and-
if it is addressed to retail investors, shall establish and maintain the internal audit function∙
if it is addressed to professional and/or well informed investors, and if it is appropriate and proportionate in view of the range, nature, scale and complexity of its business, limited partnership shall establish and maintain the internal audit function∙
It is provided that, the legal compliance and internal audit functions shall be independent from the other functions and activities of the limited partnership∙
(e) articles 20 to 22 of the Alternative Investment Fund Managers Law and articles 75 to 82 of Regulation (EU) No. 231/2013, shall apply proportionately.
(3) The internally managed AIF, which operates in the form of a limited partnership, shall not engage in activities other than those referred to in article 6(1).
(4) Without prejudice to the provisions of article 14(1), an internally managed AIF which operates in the form of a limited partnership, shall have, at any time, either in cash or assets readily convertible to cash, an initial capital of at least one hundred and twenty five thousand euro (€125.000)∙ the own funds shall not be calculated in the assets of the AIF which are used for investment purposes:
It is provided that, in case the own funds consist of cash, they shall be deposited into an account of a credit institution established in a member state, in the name of the AIF.
(5) The units of the investment company can only be issued in the name of the unitholder and shall be fully paid to be issued. Fractions of units shall not be recognised.
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