Regulation No. 2007-03 - Amendments to Regulation No. 2006-03 on Collective Investment Services

THE GENERAL DIRECTOR OF THE CENTRAL BANK OF THE REPUBLIC OF SAN MARINO

HAVING REGARD to Law No. 165 of 17 November 2005 (hereinafter for brevity: "LISF") which, among other things, attributes to the Central Bank of the Republic of San Marino the task of regulating collective investment services;

HAVING REGARD to the Central Bank Regulation No. 2006-03 on collective investment services;

HAVING REGARD to the Statute of the Central Bank of the Republic of San Marino approved by Law No. 96 of 29 June 2005 and in particular Article 30, paragraph 3 of the aforementioned Statute, pursuant to which the acts of the Central Bank in matters of supervision, deliberated by the Supervisory Coordination, are issued by the General Director;

HAVING REGARD to the resolutions of the Supervisory Coordination of 19 April 2007 and of the Board of Directors of 23 April 2007, by which the text of the Regulation of the Central Bank of the Republic of San Marino that amends Regulation No. 2006-03 on collective investment services was approved,

ISSUES the attached Regulation No. 2007-03 which introduces certain amendments to Regulation No. 2006-03 on collective investment services and which will be published in the Official Gazette of the Republic of San Marino, pursuant to Article 39 of the LISF. The regulation enters into force the day following the date of this issuance act.

San Marino, 26 April 2007

SIGNED: THE GENERAL DIRECTOR Luca Papi

REGULATION AMENDING REGULATION NO. 2006-03 ON THE MATTER OF COLLECTIVE INVESTMENT SERVICES

Year 2007 / Number 03

Central Bank of the Republic of San Marino Regulation No. 2007-03 amending Regulation No. 2006-03 on collective investment services

Article 1 – Amendments to Regulation No. 2006-03 on collective investment services.

1. In Article 8, paragraph 1, of Regulation No. 2006-03, the word "seven hundred fifty thousand" is replaced by the word "two hundred thousand".

2. Article 12, paragraph 1, of Regulation No. 2006-03 is replaced by the following: "Pursuant to Article 12 of the LISF, the authorization issued or the variation of the authorization granted must be followed by the no-objection of the State Congress, except in the case that the authorization or variation concerns exclusively the activity of promotion, establishment, organization and management of FUNDS reserved for PROFESSIONAL CLIENTS as defined in Article 76, or of ALTERNATIVE FUNDS, as defined in Article 77".

3. Article 17, paragraph 1, of Regulation No. 2006-03 is replaced by the following: "1. Following the issuance of the authorization for the establishment of an AMC, subjects who intend to directly or indirectly acquire a SIGNIFICANT PARTICIPATION in the capital of the AMC must submit a request for prior authorization to the CENTRAL BANK".

4. In Article 21, paragraph 1, of Regulation No. 2006-03, letter c) is replaced by the following: "c) not have pending criminal proceedings against them for offenses referred to in the preceding letter a)".

5. In Article 43, paragraph 1, letter b), of Regulation No. 2006-03, after the words: "Article 44," the words "paragraph 1," are added.

6. In Article 43, paragraph 1 of Regulation No. 2006-03, the following letter is added: "c) the capital coverage required for compliance with the coefficient 'other risks', as determined in Article 44, paragraph 2".

7. In Article 43, paragraph 2, of Regulation No. 2006-03, after the words: "Article 44," the words "paragraph 1" are added.

8. Article 43, paragraph 3, of Regulation No. 2006-03, is replaced by the following: "AMCs must ensure continuous compliance with minimum capital requirements".

9. To the heading of Article 44 of Regulation No. 2006-03, the words "and to other risks" are added.

10. At the end of Article 44, paragraph 1, of Regulation No. 2006-03, the words: ", up to a maximum of 10 million euros" are added.

11. In Article 44 of Regulation No. 2006-03, the following paragraph is added: "2. On the fixed operational costs resulting from the balance sheet of the last financial year, a capital coverage of 10 percent is applied. The CENTRAL BANK has the discretion to reduce this obligation in case of substantial modification of the activity compared to the previous financial year. In the first year of activity, a capital coverage of 10 percent of the fixed operational costs forecast in the annual budget is applied. For the calculation of the amount of fixed operational costs, AMCs must refer to the amounts of items 80 'Other management charges' and 90 'Administrative expenses' of the Income Statement schema".

12. In Article 120, paragraph 2, letter b), of Regulation No. 2006-03, after the word "public" the words: "- which must be drawn up in Italian -" are added.

13. In Article 120, paragraph 2, letter c), of Regulation No. 2006-03, after the word "professional" the words: "- which must be drawn up in Italian or English -" are added.

14. At the end of Article 143, paragraph 1, of Regulation No. 2006-03, the words: ", subject to the obligations and limitations arising from anti-money laundering legislation" are added.

15. In Article 154 of Regulation No. 2006-03, paragraph 2 is replaced by the following: "The document indicated in the preceding paragraph 1, letter a) must be subject to audit and certification as provided for in Article 33 of the LISF".

16. In Article 163 of Regulation No. 2006-03, the following paragraph is added: "3. The communication is not required if the offer referred to in paragraph 1 concerns UCITS III funds for which the documentation in Italian indicated in Article 164, paragraph 2, letter b) is available. The obligations under Article 167 remain unchanged".

17. Article 164, paragraph 1, of Regulation No. 2006-03, is replaced by the following: "The communication must be submitted to the Central Bank of the Republic of San Marino – Supervisory Coordination by the offeror and must indicate the name of the AIF and the foreign company that promotes or manages it".

Article 2 – Entry into force.

1. This regulation enters into force the day following the date of issuance.

Article 3 – Consolidated text of Regulation No. 2006-03.

1. The text of Regulation No. 2006-03 consolidated with the amendments introduced by this regulation will be made available on the website of the Central Bank of the Republic of San Marino (www.bcsm.sm).

Article 4 – Transitional provisions.

1. Subjects who have submitted applications for authorization for the establishment of AMCs are authorized to release, from the deposit provided for in Article 8, paragraph 2, of Regulation No. 2006-03, the amount exceeding the new minimum share capital threshold indicated in the preceding Article 1, paragraph 1.