Regulatory Alerts2023-08-24
Instruction No. 44/2010 on the Approval of Management Companies for Securitization Funds on the UMOA Regional Financial Market
The West African Monetary Union's Regional Council for Public Savings and Financial Markets issued Instruction No. 44/2010 to establish the approval framework for management companies overseeing Common Securitization Funds on the UMOA regional financial market. The regulation mandates that eligible management companies maintain a minimum paid-up capital of 250 million FCFA, possess qualified internal controllers and fund managers, and submit comprehensive documentation detailing their legal structure, human resources, technical systems, and statutory auditors. Upon approval, companies must pay a 5 million FCFA fee, display their approval number in public disclosures, and ensure seamless succession planning through asset custodians in the event of final activity cessation.
WEST AFRICAN MONETARY UNION
CREPMF
REGIONAL COUNCIL FOR PUBLIC SAVINGS AND FINANCIAL MARKETS
INSTRUCTION NO. 44/2010
ON THE APPROVAL OF MANAGEMENT COMPANIES FOR SECURITIZATION FUNDS ON THE UMOA REGIONAL FINANCIAL MARKET
The Regional Council for Public Savings and Financial Markets,
WHEREAS the Convention of July 3, 1996 establishing the Regional Council for Public Savings and Financial Markets (hereinafter the "Council");
WHEREAS the Annex to the Convention on the composition, organization, functioning and powers of the Council;
WHEREAS the General Regulation relating to the Organization, Functioning and Supervision of the UMOA Regional Financial Market;
WHEREAS Regulation CM/02/2010/CM/UEMOA on Common Securitization Funds and securitization operations in the UMOA;
WHEREAS Decision No. CM/11/09/2009 dated September 25, 2009 by the UMOA Council of Ministers appointing the President of the Council;
WHEREAS the deliberations of the Council in its session on May 18, 2010;
HAS DECIDED AS FOLLOWS:
Article 1: Application for Approval
Any Common Securitization Fund (hereinafter "CSF"), whether its securities are subject to a public offering or not, may only be managed by a management company approved by the Council.
The approval of the CSF management company is subject to the prior submission, with the Council, of a file containing the documents referred to in Article 3 of this Instruction.
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Instruction No. 44/2010
Article 2: Eligibility Conditions
Any company applying for approval as a CSF management company must meet the following conditions:
- Legal Form
The management company must necessarily take the form of a public limited company with a Board of Directors whose exclusive purpose is the management of one or more CSFs.
- Registered Office
The management company must have its registered office in one of the UMOA Member States.
- Share Capital
The minimum share capital of the management company is set at two hundred and fifty million (250,000,000) FCFA. It must be fully paid up upon incorporation and the company must permanently maintain net equity equal to or greater than this amount.
The proportion of share capital held by each shareholder, as well as their identity and status, must be indicated.
The institution that has transferred claims to a CSF may not hold, alone or with its group companies, a stake equal to one third of the capital of that CSF's management company. The group companies of the transferring institution are those which, directly or indirectly, either control the transferring institution or are controlled by it or by one of the companies that control it.
If in-kind contributions have been made on an ancillary basis, the report of the statutory auditor for contributions must be attached to the file.
- Integrity of Shareholders and Directors
Natural persons who have incurred one or more convictions in any country for economic and financial offenses or common law crimes, attempts, complicity or handling of fraud in documents or use of forged documents, fraud, breach of trust, misappropriation of public funds, extortion of funds or securities and acts of counterfeiting, or generally any conviction for crimes or offenses assimilated to any of those listed above, may not be shareholders, directors or administrators of a company applying as a management company for this CSF.
Article 3: Application File for Approval
The application file for approval includes a certified copy of the management company's bylaws, the notarized declaration of subscription and payment, the registration declaration with the Commercial and Movable Credit Register, as well as a presentation document of the management company.
Avenue Joseph ANOMA 01 B. P.: 1878 Abidjan 01/Côte d’Ivoire | TEL: (225) 20215742/20215179 Fax: 20221657 | presidence@crepmf.org | www.crepmf.org | 2/5
Instruction No. 44/2010
The management company's presentation document includes the following information:
- Information on the amount and distribution of share capital
- Resources of the management company
The management company must provide sufficient guarantees regarding its organization, technical and human resources, the integrity and professional experience of its directors and persons related to investors. These functions require the issuance of a professional card that the applying company must request simultaneously with its approval application.
2.1 Legal Representatives, Corporate Officers and Internal Controller
The surname, first name, address, nationality, date and place of birth of the legal representatives, corporate officers and internal controller of the company must be stated.
For each of them, the following must be provided:
- a criminal record extract dated less than three months ago;
- an up-to-date curriculum vitae.
Any other professional activities carried out by the company's legal representatives must be stated, where applicable.
2.2 Human Resources
The presentation document includes an organizational chart of the management company specifying:
- the hierarchical level of the internal controller;
- the number, hierarchical level of other salaried employees of the company, and the nature of their employment contracts;
- the number and hierarchical level of persons seconded to the company on a long-term basis.
Secondment contracts must be communicated to the Council.
The curricula vitae of the management company's salaried employees or seconded persons for exercising the company's main missions are attached to the file.
The staff must include at least:
- one internal controller;
- one fund manager;
- one accountant.
Avenue Joseph ANOMA 01 B. P.: 1878 Abidjan 01/Côte d’Ivoire | TEL: (225) 20215742/20215179 Fax: 20221657 | presidence@crepmf.org | www.crepmf.org | 3/5
Instruction No. 44/2010
2.3 Technical Resources
Technical resources are assessed based on the management company's need to have autonomous capacity to monitor payment flows destined for security holders and to realize guarantees granted to the CSF, where applicable.
In case of seconded resources, the secondment contracts must be communicated to the Council.
The company must be equipped with management software and accounting software. The functionalities of said software must be adapted to the company's activities. These software programs must be acquired prior to the commencement of the company's activities.
2.4 Services Provided by External Bodies and Supervision
The presentation document must mention external service providers and the description of tasks they are responsible for executing, specifying the resources deployed.
Service contracts must be communicated to the Council.
2.5 Permanence and Adjustment of Resources
The management company's resources must be aligned with the amount of assets under management and the management techniques used.
The Council may request any clarifications regarding the management company's activity, regardless of whether the managed funds have made a public offering.
3. Reference to the Statutory Auditors of the Management Company
The name(s) and address(es) of the company's Statutory Auditor(s) must be stated. The start date, duration and expiration date of their mandate(s) must be specified.
These Statutory Auditors must be approved by the Council. The approval request for the principal and alternate Statutory Auditors is submitted to the Council simultaneously with the management company's approval application.
Article 4: Processing of the Application
The Council rules on the approval application within a maximum period of three months following the submission of a complete file; this period is suspended until receipt of any requested supplementary elements, where applicable.
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Instruction No. 44/2010
The Council may, if it deems necessary, conduct a hearing of shareholders or corporate officers during the processing procedure of the approval file.
Article 5: Approval Decision
The processing of approval files by the Council concludes with the notification of a decision to the applying company.
The approval decision is published.
The granting of approval to a management company is subject to the payment of a fee of five million (5,000,000) FCFA.
The reference to the approval number must appear in all documents disseminated to the public by the management company.
Article 6: Modification of Approval Conditions
Any modification concerning the characteristic elements listed in the approval file must be submitted to the prior approval of the Council.
Article 7: Final Cessation of Activity
In the event of final cessation of activity by the management company due to early dissolution, liquidation of assets or withdrawal of approval, the CSF's asset custodian must proceed, within a maximum period of one (01) month, to designate another management company and submit its file for the Council's approval.
The liquidation of the management company is carried out in accordance with the provisions of Instruction No. 32/2005 relating to the withdrawal procedure for approval granted by the Council and common law.
Article 8: Entry into Force
This Instruction, which enters into force as of the date of its signature, shall be published wherever necessary.
Done at Abidjan, on August 31, 2010
The President
(Signature) Léné SEBGO