Monday, January 10, 2011

Public Funds Code Issued by the Commission

In the end of December, the Public Funds Code, 2010 was issued by the British Virgin Islands Financial Services Commission. Consultation draft of the Public Funds Code was published in June 2010. The legislative document shall come into force on the 31st of March, 2011. As the Public Code is issued under SIBA, it has the status of delegated, or subsidiary legislation. As subsidiary legislation, the Public Funds Code has the status of law in the British Virgin Islands.

Part I of the legislative document names the four general principles for public fund business: integrity, management and control, keeping interests of investors, and relationship with Commission in an open and cooperative manner. Part II concerns operation of Public Funds, including the following issues:
- corporate governance (the number of directors of public funds, responsibility of governing body for business and affairs of the public fund);
- establishment of policies and procedures, including the cases of conflicts of interest;
- segregation and safekeeping of fund property, including custodial arrangements and procedures, issue and redemption of fund interests;
- valuation and pricing including establishment of valuation policy and procedures and independence of valuation process, pricing and price overrides, NAV reports, disclosure to investors;
- dealing and managing by functionaries;
- record keeping;
- relationship and reporting to the Commission;
disclosure to investors and changes to investor rights.

In the Schedule 1 of the Public Funds Code it is stated what kind of information must be contained in prospectus of public fund. Schedule 2 names events and changes to be notified to the Commission, and time limits for notification for each event.

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