Regulation No. 2022-03 - Updating Transparency Rules for Investors in Common Investment Funds

VICE DIRECTOR OF THE CENTRAL BANK OF THE REPUBLIC OF SAN MARINO HAVING REGARD TO Delegated Decree of 24 January 2022 No. 8 (Provisions on financial matters implementing Regulations (EU) No. 648/2012, 909/2014, 2015/2365 and 2016/1011) and in particular Article 17, which assigns to the Central Bank of the Republic of San Marino the implementation regulation of transparency obligations towards investors regarding the use of SFT (Securities Financing Transactions) or total return swaps in the management of common investment funds; HAVING REGARD TO Law 29 June 2005 No. 96 and subsequent amendments (Statute of the Central Bank of the Republic of San Marino) and in particular Article 30, paragraph 3, which assigns the issuance of acts of the Central Bank to the General Director, and Article 14, paragraph 5, which regulates the case of absence or impediment of the General Director; HAVING REGARD TO the resolutions of the Supervision Coordination and the Board of Directors by which the text of Regulation No. 2022-03 titled “Regulation updating transparency rules towards investors in common investment funds” was approved; ISSUES the attached Regulation No. 2022-03 which enters into force on 1 January 2023. San Marino, 24 October 2022 Signed: THE VICE DIRECTOR f.f. Dr. Andrea Vivoli

REGULATION UPDATING TRANSPARENCY RULES TOWARDS INVESTORS IN COMMON INVESTMENT FUNDS year 2022 / number 03

Central Bank of the Republic of San Marino Regulation No. 2022-03 updating transparency rules towards investors in common investment funds 1 Article 1 – Purpose

1. This Regulation aims to implement Article 17 of Delegated Decree 24 January 2022 No. 8. “Provisions on financial matters implementing Regulations (EU) No. 648/2012, 909/2014, 2015/2365 and 2016/1011”. Article 2 – Amendments to Regulation No. 2006-03 on collective investment services
2. The following letters are added to paragraph 1 of Article 1: “p-bis) “securities financing transaction” or “SFT”: securities financing transaction as defined in Article 3 of Delegated Decree 24 January 2022 No. 8”; “bb-bis) “total return swap”: derivative contract as defined in Article 3 of Delegated Decree 24 January 2022 No. 8;”.
3. In letter c) of paragraph 1 of Article 122, the following point is inserted after point 3), with consequent renumbering of the current point 4) as point 5): “4) if the FUND intends to carry out SFT or TOTAL RETURN SWAP operations and, if so, reporting the information required in Section B of the Annex to Regulation (EU) No. 2365/2015 on transparency of securities financing transactions and reuse;”.
4. Letter e) of paragraph 1 of Article 122 is replaced as follows: “ e) risk profile that the manager attributes to the product based on parameters (such as, by way of indication, volatility, financial leverage, VaR, use of financial derivative instruments or SFT) specified in the regulations, taking into account the subject matter and investment strategies;”.
5. After the third paragraph of Section B of Part D of Annex G, the following paragraph is added: “Indicate whether the fund carries out securities financing transactions (SFT) or total return swap operations and, if so, report the information required in Section B of the Annex to Regulation (EU) No. 2365/2015 on transparency of securities financing transactions and reuse.”. Article 3 – Amendments to Regulation No. 2007-06 for the preparation of accounting prospectuses of common investment funds
6. In paragraph 4 of the Notes to the Financial Statements of Annex A, the following point is added: “4) for funds that carry out securities financing transactions (SFT) or total return swap operations, indicate the information and data required in Section A of the Annex to Regulation (EU) 2015/2365 on transparency of securities financing transactions and reuse.”.
7. In paragraph 4 of the Notes to the Financial Statements of Annex B, the following point is added:

Central Bank of the Republic of San Marino Regulation No. 2022-03 updating transparency rules towards investors in common investment funds 2 “3) for funds that carry out securities financing transactions (SFT) or total return swap operations, indicate the information and data required in Section A of the Annex to Regulation (EU) 2015/2365 on transparency of securities financing transactions and reuse.”. Article 4 – Final and Transitional Provisions

1. This Regulation enters into force on 1 January 2023.
2. The regulations and information prospectuses of common investment funds already authorized at the date of issuance of this Regulation must be adapted, in accordance with what is provided for in Article 128 of Regulation No. 2006-03, at the first available opportunity and in any case by 31 March 2023.
3. By virtue of what is provided for in paragraph 1, the new provisions regarding the preparation of accounting prospectuses of common investment funds referred to in Article 3 apply starting from the annual report referring to the year 2023. Article 5 – Consolidated Texts
4. The consolidated texts with the modifications introduced by this Regulation will be made available on the website of the Central Bank of the Republic of San Marino (www.bcsm.sm).