s.31Powers of Authority in respect of licensed mutual fund administrators
31
Section 31Part 5 — Duties and Powers of the AuthorityAmended

Powers of Authority in respect of licensed mutual fund administrators

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Amended by LG41/S9
The Authority may take any actions specified in subsection (3) if it is satisfied that —
a licensed mutual fund administrator is or is likely to become unable to meet its obligations as they fall due; ( aa ) a licensed mutual fund administrator has contravened any provision of this Act or of the Anti - Money Laundering Regulations (2025 Revision) ; ( ab ) a licensed mutual fund administrator who is a “corporate services provider”, as defined in the Beneficial Ownership Transparency Act, 2023 [Act 13 of 2023] , has contravened that Act ;
a licensed mu tual fund administrator is carrying on or attempting to carry on business or is winding - up its mutual fund administration business in a manner that is prejudicial to investors in any mutual fund it is administering or to its creditors or to the creditors o f any such mutual fund;
a licensed mutual fund administrator is carrying on or attempting to carry on the business of mutual fund administration without complying with any condition of its Mutual Fund Administrators Licence;
the direction and management of a licensed mutual fund administration business has not been conducted in a fit and proper manner;
a person holding a position as a director, manager or officer of a licensed mutual fund administration business is not a fit and proper pers on to hold the respective position; or
a person acquiring control or ownership of a licensed mutual fund administration business in the circumstances set out in section 13
(a) is not a fit and proper person to have such control or ownership. ( 2 ) For the purpose of alerting it as to whether or not an event referred to in subsection (1) has occurred or is likely to occur, the Authority shall immediately enquire into and ascertain the reason for — ( a ) any failure by a licensed mutual fund administrator — ( i ) to give the Authority notice that it has started to provide the principal office of a regulated mutual fund in accordance with section 14(1), to pay the prescribed annual fee in respect of a regulated mutual fund in accordance with section 14(2) or to pay its prescribed fee in accordance with section 14
; ( ii ) to provide a guarantee or other financial support or to increase its net worth in accordance with a direction given under section 15 ; ( iii ) to satisfy itself with respect to a mutual fund or any promoter or operator of a fund as required by section 16 ; ( iv ) to give the Authority written notice in respect of the affairs of a regulated mutual fund as required by section 17 ; ( v ) to change its name in accordance with a direction given to it under section 18(2); ( vi ) to h ave its accounts audited in accordance with section 20(1) or to send its audited accounts to the Authority in accordance with section 20(2); ( vii ) to have at least two directors as required by section 22 ; or ( viii ) to have its accounts audited, and to submit the audited accounts to the Authority when instructed to do so under section 26 ; ( b ) the issue by the administrator of shares without the Authority ’ s approval, contrary to section 13 ; ( c ) the appointment of a director or similar senior officer, or general partner of the administrator without the Authority ’ s written approval, contrary to section 21 ; or ( d ) any shares in the administrator being d isposed of or dealt in without the Authority ’ s approval, contrary to section 13 . ( 3 ) For the purposes of subsection (1), the actions the Authority may take in respect of a licensed mutual fund administrator are to —
revoke any Mutual Fund Administrators Licence the mutual fund administrator holds;
impose conditions or further conditions on its Mut ual Fund Administrators Licence and to amend or revoke those conditions;
require the substitution of any director or similar senior officer or a general partner of the administrator;
appoint a person to advise the administrator on the proper conduc t of its mutual fund administration; and
appoint a person to assume control of the affairs of the administrator relating to mutual fund administration.
If the Authority takes action under subsection (3), the Authority may apply to the Grand Court for an order to take such other action as it considers necessary to protect the interests of investors in the funds administered by the administrator and its creditors and the creditors of any such fund.
A person appointed under subsection (3)(d) or (e) is appointed at the expense of the relevant administrator, and any expenses incurred by the Authority by virtue of the appointment is an amount due to the Authority, payable by the administrator.
A person appointed under subsection (3)(e) has all t he powers necessary, to the exclusion of any other person (other than a liquidator or receiver), to administer the affairs of the administrator relating to mutual fund administration in the best interest of investors in the funds administered by the admini strator and its creditors and creditors of any such funds.
The powers referred to in subsection (6) include the power to terminate the business of the administrator so far as it relates to mutual fund administration.
A person appointed in respect o f a licensed mutual fund administrator under subsection (3)(d) or (e) shall —
when requested to do so by the Authority, supply the Authority with such information in respect of the administrator ’ s administration of mutual funds as is specified by the A uthority;
within three months of that person’s appointment, or within such other period as the Authority may specify, prepare and supply to the Authority a report on the administrator ’ s administration of the mutual fund making, where appropriate, recom mendations in respect of the administrator; and
if that person’s appointment is not terminated after supplying the report referred to in paragraph (b), subsequently supply to the Authority such other information, reports and recommendations as the Auth ority specifies.
If a person appointed under subsection (3)(d) or (e) —
fails to comply with an obligation under subsection (8); or
in the Authority ’ s opinion, is not carrying out that person’s obligations in respect of the mutual fund administ rator satisfactorily, the Authority may revoke the appointment and appoint some other person in that person’s place.
On receipt of any information or a report under subsection (8) in respect of a licensed mutual fund administrator, the Authority may —
require the administrator to reorganise its affairs in a manner specified by the Authority; or
if the administrator is a company, apply to the Grand Court in accordance with section 94 of the Companies Act (2025 Revision) for the company to be wound up by the Court in accordance with that Act , and may take such action in respect of the appointment of the person appointed under subsection (3)(d) or (e) as the Authority considers appropriate.
If the Authority takes acti on under subsection (10), the Authority may apply to the Grand Court for an order to take such other action as it considers necessary to protect the interests of investors in the funds administered by the administrator and its creditors or the creditors of any such funds.
Without prejudice to any other power of the Authority, the Authority may, at any time, revoke a Mutual Fund Administrators Licence if —
the Authority is satisfied that the holder of the licence has ceased to carry on or to attempt to carry on business as a mutual fund administrator; or
the holder of the licence is placed in winding - up or is dissolved.
Where a licensed mutual fund administrator is a partnership formed under the laws of the Islands and the Authority revokes its Mutual Fund Administrators Licence in accordance with subsection (3) the partnership is to be taken to have been dissolved.

Cross References