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  • GEN 12.1 GEN 12.1 Modifications applying to transfer schemes

    • GEN 12.1.1

      The Rules in this chapter are prescribed under Article 113 of the Regulatory Law and Part 9 of that Law is to be read as if it was modified, in relation to the cases set out in Rule 12.1.4, as specified in this chapter.

      Derived from DFSA RM155/2015 (Made 9th December 2015) [VER35/02-16]

    • GEN 12.1.2

      In this chapter:

      (a) "Banking transfer scheme" means a transfer scheme where the whole or part of the business to be transferred relates to the Authorised Firm's business of Accepting Deposits;
      (b) "Court order" means a Court order under Article 108 of the Law;
      (c) "Fund transfer scheme" means a transfer scheme relating to the Fund Property of a Domestic Fund or of a sub-fund of an Umbrella Fund that is a Domestic Fund;
      (d) "Insurance transfer scheme" means a transfer scheme where the whole or part of the business to be transferred relates to the Authorised Firm's Insurance Business;
      (e) "the Law" means the Regulatory Law; and
      (f) "transfer scheme" has the meaning given in Article 106 of the Law.
      Derived from DFSA RM155/2015 (Made 9th December 2015) [VER35/02-16]

    • GEN 12.1.3

      The Rules in this chapter do not modify the provisions of Part 9 of the Law so far as they apply to any of the following:

      (a) a Banking transfer scheme;
      (b) an Insurance transfer scheme; or
      (c) a Fund transfer scheme.
      Derived from DFSA RM155/2015 (Made 9th December 2015) [VER35/02-16]

    • GEN 12.1.4

      A transfer scheme, other than a scheme referred to in Rule 12.1.3, is not required to be sanctioned by a Court order to be effective if:

      (a) all of the Clients of the Authorised Firm who will be affected by the transfer scheme have consented to it;
      (b) the transfer scheme is expressly permitted under agreements between the Authorised Firm or transferee and the Clients of the Authorised Firm who will be affected by the scheme and any procedures in the agreements for giving effect to the scheme have been complied with; or
      (c) the DFSA has consented in writing to the transfer scheme under Rule 12.1.5.
      Derived from DFSA RM155/2015 (Made 9th December 2015) [VER35/02-16]

    • GEN 12.1.5 GEN 12.1.5

      (1) An Authorised Firm or transferee may apply in writing to the DFSA seeking its consent to a transfer scheme.
      (2) The DFSA may consent in writing to the transfer scheme if it is reasonably satisfied that:
      (a) the scheme is not a transfer scheme referred to in Rule 12.1.3;
      (b) it is more appropriate and proportionate, and in the overall interests of Clients affected by the scheme, for the Authorised Firm or transferee to seek the DFSA's consent rather than applying to the Court for an order sanctioning the scheme;
      (c) the Authorised Firm or transferee has taken all reasonable steps to pursue other options for giving effect to the scheme;
      (d) the scheme is not likely to result in any material prejudice to the interests of Clients of the Authorised Firm; and
      (e) implementation of the scheme will not result in the Authorised Firm or transferee contravening any applicable law or Rule.
      (3) The procedures in Schedule 3 to the Law apply to a decision of the DFSA under (2) to refuse to give its consent to a transfer scheme.
      (4) If the DFSA decides to refuse to give its consent under this Rule, the Authorised Firm may refer the matter to the FMT for review.
      Derived from DFSA RM155/2015 (Made 9th December 2015) [VER35/02-16]

      • GEN 12.1.5 Guidance

        1. The DFSA expects to receive applications seeking its consent to a transfer scheme only in limited circumstances, and if the scheme is not complex or contentious. If a scheme is likely to be contentious or complex, then it is more appropriate for an application to be made to the Court.
        2. The DFSA will not give its consent unless the applicant can demonstrate that it has taken all reasonable steps to pursue other options for implementing the scheme, such as seeking the consent of affected Clients or using existing agreements with Clients.
        3. The DFSA also will not give its consent in cases such as where:
        (a) the transfer scheme is likely to materially prejudice the interests of Clients;
        (b) due to the complexity of the transfer scheme it is unclear what the precise impact of the scheme will be on Clients or whether it will be legally effective; or
        (c) implementation of the transfer scheme will result in the Authorised Firm or transferee breaching a requirement in a law or Rule, for example, if the transferee does not have the necessary authorisation to conduct that business or if the transfer will result in the Authorised Firm or transferee breaching a prudential requirement.
        4. The type of case where the DFSA anticipates giving its consent to a transfer scheme is where the scheme is relatively simple and the applicant has taken all reasonable steps to pursue other options but has been unable to complete the necessary processes because, for example, a small number of Clients do not respond.
        Derived from DFSA RM155/2015 (Made 9th December 2015) [VER35/02-16]