CIR 5 CIR 5 Fund Administrators
CIR 5.1 CIR 5.1 General
CIR 5.1.1(1) Subject to (2), this chapter applies to an
Authorised Firmwhich is appointed as a Fund Administratorto either a Domestic or a Foreign Fund.(2) This chapter does not apply to a Fund Manageror Trusteeto the extent that it carries on an activity of Providing Fund Administrationwithin the Financial Servicesof Managing a Fundor of Acting as the Trustee of a Fund.
Compliance with the AML Rules
Client Money and Assets
Fund Administrator, in Providing Fund Administrationfor a Domestic Fundor Foreign Fund, must not hold or control monies or assets belonging to third parties in connection with such administration except in the following circumstances:(a) holding cheques to the order of a Fund'sbank account, provided such cheques are securely held for a maximum of three business days prior to being deposited into the relevant Fund'sbank account or returned to the drawer of the cheque; or(b) where a mandate over a Fund'sor other third party's bank account is granted to a Fund Administratorand the mandate has been agreed in writing with the bank concerned, and transfers out of the relevant bank account may be made only in circumstances where the mandate restricts instructions to make such payments to being made solely in accordance with the payment of invoiced fees and expenses, made in accordance with the relevant Fund's Constitutionand Prospectusand are not remitted to the account of the Fund Administratorexcept by express instructions of the Fund Manager.
Delegation and Service Level Agreements
CIR 5.1.4 CIR 5.1.4(1) A
Fund Administratorof a Domestic Fundfor which it is Providing Fund Administrationmust have a Delegation Agreementthat meets the requirements in CIR App1 with the Fund Manageror Trusteeof the Fund.(2) Paragraph (1) does not apply to a Fund Administratorof a Qualified Investor Fund.
CIR 5.1.4 Guidance
CIR Section 8.12of this module governs the delegation of activities by a Fund Manageror where appointed the Trustee.
CIR 5.1.5 CIR 5.1.5(1) A
Fund Administratorof a Foreign Fundfor which it is Providing Fund Administrationmust have a service level agreement with the fund manager of that Foreign Fundsetting out the functions and service standards that will be applied to the provision of such administration.(2) The agreement in (1) must ensure that the Fund Administratorcannot in turn delegate the activities and functions delegated to it by the fund manager of the Foreign Fundunless the sub-delegate has been approved by that fund manager.(3) The agreement in (1) must also require the Fund Administratorto retain any relevant work or records relating to the delegated activities and functions where the contract is terminated either by the fund manager or the Fund Administrator.
CIR 5.1.5 Guidance
DFSAwould expect any agreement required under CIR Rule 5.1.5 to include as a minimum the following provisions:a. unambiguous descriptions and definitions of the activities and functions to be provided by the Fund Administratorand the duties to be performed by both parties;b. an agreed standard in respect of resources and services supported as necessary by performance measures in accordance with the applicable legislation;c. the requirement for regular detailed reporting to a specified frequency from the Fund Administratorin respect of its duties and activities;d. provisions relating to the reporting of relevant events such as technological changes or error reporting and, in particular, any event which undermines the ability of the Fund Administratorto fulfil its duties;e. the requirement for an annual review (at a minimum) of the performance of the functions by the Fund Administrator; andf. provisions relating to records and adequate access by the fund manager, the Fund'sauditor or any other Personsproviding control or risk management functions for the Fund, as required by the fund manager or applicable laws to that Fund.
Fund Administratormust maintain records which are sufficient to show and explain transactions in relation to each of the specific activities and functions which are being provided to each Fund, in respect of Unitholdersor potential Unitholdersof the Fundas appropriate.
The records required under CIR Rule 5.1.6 must be:(a) capable of demonstrating to the
Governing Bodyof the relevant Fundthat any accounts prepared comply with the applicable requirements in this module or any other applicable legislation;(b) retained by the Fund Administratorfor at least 6 years from the date to which they relate;(c) at all reasonable times, open to inspection by the DFSA, the Fund's Auditorand any Personproviding oversight functions for the relevant Fund; and(d) if requested by the DFSA, capable of reproduction within a reasonable period not exceeding 3 days, in hard copy and in English.