Regulatory Alerts2022-02-18
FSCA Communication 3 of 2022: Permissible Deductions from Portfolio
The Financial Sector Conduct Authority published a formal determination specifying additional costs and fees that collective investment scheme managers may now deduct from investor portfolios. This ruling explicitly permits the deduction of outsourced administrative expenses, including value-added tax recovery and withholding taxes, as well as legal costs incurred to protect or enforce portfolio assets. By shifting these expenditures from managers' own fees to the portfolios, the determination enables appropriate counterparty fee netting and ensures that sophisticated service costs directly benefit investors.
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