UKLR 11.4 Continuing obligations, further issuances, dealing in own securities and treasury shares

A closed-ended investment fund must comply with all of the requirements of UKLR 6 (Equity shares (commercial companies): continuing obligations) and UKLR 9 (Equity shares (commercial companies): further issuances, dealing in own securities and treasury shares) subject to the modifications and additional requirements set out in this section.

UKLR 6 and UKLR 9 are modified so that references to the equity shares (commercial companies) category are to the closed-ended investment funds category.

UKLR 6.2.31R to UKLR 6.2.33G do not apply to a close-ended investment fund.

A closed-ended investment fund must, at all times, have a published investment policy which complies with UKLR 11.2.8R.

A closed-ended investment fund must, at all times, invest and manage its assets:

1. (1)

   in a way which is consistent with its object of spreading investment risk; and

2. (2)

   in accordance with its published investment policy.

A closed-ended investment fund must comply with UKLR 11.2.4R at all times.

A closed-ended investment fund must, when making an acquisition of a constituent investment, observe the principles relating to cross-holdings in UKLR 11.2.6R.

If a closed-ended investment fund principally invests its funds in the manner set out in UKLR 11.2.7R, the closed-ended investment fund must ensure that UKLR 11.2.7R is complied with at all times.

UKLR 11.2.10R to UKLR 11.2.15R apply at all times to a closed-ended investment fund.

The board of directors or equivalent body of the issuer must effectively monitor and manage the performance of its key service providers, including any investment manager appointed by the issuer, on an ongoing basis.

Unless UKLR 11.4.15R applies, a closed-ended investment fund must:

1. (1)

   submit any proposed material change to its published investment policy to the FCA for approval; and

2. (2)

   having obtained the FCA’s approval, obtain the prior approval of its shareholders to any material change to its published investment policy.

A closed-ended investment fund is not required to seek the FCA’s approval for a material change to its published investment policy if:

1. (1)

   the change is proposed to enable the winding up of the closed-ended investment fund; and

2. (2)

   the winding up:

   1. (a)

      is in accordance with the constitution of the closed-ended investment fund; and

   2. (b)

      will be submitted for approval by the shareholders of the closed-ended investment fund at the same time as the proposed material change to the investment policy.

An existing listed class of equity shares may not be converted into a new class or an unlisted class unless prior approval has been given by the shareholders of that existing class.

1. (1)

   Unless authorised by its shareholders, a closed-ended investment fund may not issue further shares of the same class as existing shares (including issues of treasury shares) for cash at a price below the net asset value per share of those shares unless they are first offered pro rata to existing holders of shares of that class.

2. (2)

   When calculating the net asset value per share, treasury shares held by the closed-ended investment fund should not be taken into account.

A closed-ended investment fund is not required to comply with UKLR 6.2.25R.

A closed-ended investment fund is not required to comply with UKLR 6.2.3R to UKLR 6.2.10R.

1. (1)

   A closed-ended investment fund is not required to comply with UKLR 6.2.35R in so far as it relates to UKLR 6.2.8R and UKLR 6.2.9R.

2. (2)

   A closed-ended investment fund is not required to comply with UKLR 6.2.36R.

A closed-ended investment fund is not required to comply with UKLR 6.6.1R(13) or UKLR 6.6.6R(8).

When making a statement required by UKLR 6.6.6R(9) in its annual financial report, a closed-ended investment fund need not set out the following matters if they are inapplicable to the closed-ended investment fund and its statement sets out the reasons why those matters are inapplicable:

1. (1)

   whether the closed-ended investment fund has met the board diversity target in UKLR 6.6.6R(9)(a)(ii); and

2. (2)

   matters set out in UKLR 6.6.6R(9)(b) to the extent that they relate to the board diversity target in UKLR 6.6.6R(9)(a)(ii).

When including numerical data required by UKLR 6.6.6R(10) in its annual financial report, a closed-ended investment fund need not include the fields in the first row of each of the tables in UKLR 6 Annex 1, and the corresponding data for those fields, that are inapplicable to the closed-ended investment fund, if it sets out in a statement accompanying the numerical data the reasons why those fields are inapplicable.

Where the provisions of this chapter require a shareholder vote to be taken, that vote must be decided by a resolution of the holders of the closed-ended investment fund’s equity shares that have been admitted to the closed-ended investment funds category.