Instruction No. 21/99 on the Classification of Collective Investment Schemes in Securities

WEST AFRICAN MONETARY UNION REGIONAL COUNCIL FOR PUBLIC SAVINGS AND FINANCIAL MARKETS

INSTRUCTION NO. 21/99 ON THE CLASSIFICATION OF COLLECTIVE INVESTMENT SCHEMES IN SECURITIES

Having regard to the Convention of 3 July 1996 establishing the Regional Council for Public Savings and Financial Markets, hereinafter referred to as the Regional Council; Having regard to Articles 18, 19 and 20 of the Annex to said Convention; Having regard to the General Regulation on the Organization, Operation and Supervision of the regional financial market of the UMOA, adopted by Decision No. 001/97 of the Council of Ministers on 28 November 1997; Having regard to Articles 72 to 89 of said General Regulation; Having regard to the decision of the Regional Council in its session on 02 July 1999; THE REGIONAL COUNCIL HAS ADOPTED:

Article 1 Collective management of securities is carried out within "Collective Investment Schemes in Securities" (CIS) grouped into:

• Variable Capital Investment Companies (SICAV),
• Common Investment Funds (FCP),
• or any other form of collective investment scheme in securities approved by the Regional Council.

CHAPTER 1: VARIABLE CAPITAL INVESTMENT COMPANIES (SICAV) Article 2: A Variable Capital Investment Company is a public limited company whose object is the management of a portfolio of securities. The SICAV has its registered office in one of the member countries of the UMOA. 1

Article 3: Banks approved by the Regional Council in their capacity as account-keeping and clearing institutions, Management and Intermediation Companies (SGI), and any other structure authorized to this effect by the Regional Council may establish Variable Capital Investment Companies.

Article 4: A Variable Capital Investment Company may be managed by a Management Company whose exclusive object is to manage SICAVs. The Management Company is subject to approval by the Regional Council.

Article 5: The initial capital of a Variable Capital Investment Company may not be less than one hundred million CFA francs (CFA 100,000,000). The shares of the Variable Capital Investment Company must be fully paid up upon issuance. The capital amount must at all times equal the net asset value of the company, less distributable amounts. The shares of the Variable Capital Investment Company are issued and redeemed at any time by the SICAV itself upon shareholders' request at the net asset value, increased or decreased, as applicable, by fees and commissions.

Article 6: The minimum capital below which share redemptions may not be processed is seventy million CFA francs (CFA 70,000,000).

Article 7: The redemption by the Variable Capital Investment Company of its shares, as well as the issuance of new shares, may be temporarily suspended by the Board of Directors or the Management Board of the Variable Capital Investment Company when exceptional circumstances so require and if shareholders' interests so dictate, under conditions set by the company's articles of association. 2

Article 8: Capital variations resulting from the redemption and issuance of shares of the Variable Capital Investment Company are carried out without amendment to the articles of association, and without the need to submit said articles to the General Meeting or to carry out special publicity. The articles of association may not provide for particular benefits to shareholders.

Article 9: Prior to the first issuance of shares, an information statement approved by the Regional Council must be made available to the public. For all other share issuances, the Regional Council may require the submission of all documents prepared and disseminated by the Variable Capital Investment Company and may have their content or presentation modified.

Article 10: The assets of the Variable Capital Investment Company are held by a unique Depositary, distinct and independent from this company, chosen among Management and Intermediation Companies and banks exercising account-keeping and clearing activities approved by the Regional Council. The Depositary's liability is not engaged merely because it entrusts all or part of the assets in its custody to a third party. It ensures the regularity of the decisions of the Variable Capital Investment Company. The Depositary is designated in the articles of association of the Variable Capital Investment Company and must have its registered office in the country where the SICAV has its registered office.

CHAPTER 2: COMMON INVESTMENT FUNDS (FCP) Article 11: A Common Investment Fund is a co-ownership of securities without legal personality. The Common Investment Fund has its seat in one of the member countries of the UMOA. 3 The provisions relating to undivided ownership do not apply to the Common Investment Fund.

Article 12: The Common Investment Fund is managed by a management company whose exclusive object is to manage FCPs. The management company is subject to approval by the Regional Council.

Article 13: The units of the Common Investment Fund are issued and redeemed upon request by holders at the net asset value, increased or decreased, as applicable, by fees and commissions.

Article 14: Unit holders or their successors may not trigger the division of the Fund. Unit holders are liable for the debts of the co-ownership only up to the amount of the FCP's assets and proportionally to their share.

Article 15: The minimum amount of securities and cash deposits that every Common Investment Fund must hold upon its establishment is set at sixty million CFA francs (CFA 60 million).

Article 16: The asset level below which unit redemptions may not be processed is set at forty-five million CFA francs (CFA 45,000,000).

Article 17: Prior to the issuance of units of the Common Investment Fund, the Regional Council must endorse its visa on the information statement describing the characteristics of the Common Investment Fund. After obtaining the visa, the information statement must be made available to the public. 4

Article 18: The Common Investment Fund is established jointly by a Bank, an M&I Company (SGI), or a management company responsible for its management, and a legal entity acting as the depositary of the Fund's assets. The Common Investment Fund is represented vis-à-vis third parties by the company responsible for its management. This company may bring or defend legal actions to protect or assert the rights or interests of unit holders.

Article 19: The Regulations of the Common Investment Fund must provide that its assets are held by a unique Depositary distinct from the management company of the Common Investment Fund. The Depositary is chosen among Management and Intermediation Companies or banks approved by the Regional Council exercising account-keeping and clearing activities. The Depositary ensures the regularity of decisions by this management company. It must have its registered office in the country where the management company of the Common Investment Fund has its seat.

Article 20: The minimum amount of securities that the Fund must hold upon its establishment is CFA 10 million. The assets of the Common Investment Fund are evaluated based on a report prepared by the statutory auditor. The value of in-kind contributions is verified by a Statutory Auditor who prepares, for this purpose, a report under his/her responsibility.

Article 21: The Management Company of the Common Investment Fund and the Depositary are individually or jointly liable, as applicable, towards third parties or unit holders, for either infringements of the regulatory provisions applicable to Common Investment Funds, or violation of the Regulations of the Common Investment Fund, or for their faults. 5

Article 22: The redemption by the Common Investment Fund of its units, as well as the issuance of new units, may be temporarily suspended by the management company when exceptional circumstances so require and if unit holders' interests so dictate, under conditions set by the Regulations of the Common Investment Fund.

Article 23: The Management Company and the Depositary establish Regulations which are submitted to the Regional Council for approval. These Regulations must set the duration of the Common Investment Fund, the respective rights and obligations of unit holders, the Management Company and the Depositary, and the procedures for holding the assets of the Common Investment Fund. The Regulations must provide the rules and procedures to be followed for their modification. Any amendment to the Regulations takes effect only upon expiration of a three (3) month period following its notification to unit holders. The subscription or acquisition of units in a Common Investment Fund entails acceptance of its Regulations, the text of which must be provided to each unit holder.

Article 24: This Instruction shall be published wherever necessary. Done in Abidjan, on 02 July 1999 For the Regional Council The President L. NAKA 6