Part 9: Part 9: Control of Financial Services Transfers
106. Financial services business transfer schemes
No financial services business transfer scheme (“transfer scheme”) is to have effect unless an order has been made in relation to it under Article 108 or where the Sale Of Business Tool has been used under Article 84N(1)(h) or 84O.
A scheme is a transfer scheme if:(a) the whole or part of the business carried on through an establishment in the DIFC by an Authorised Firm ("the firm concerned") is to be transferred to another body ("the transferee") and the business to be transferred consists in whole or in part of financial services business;(b) the Fund Property of a Fund, or of a sub-fund of an Umbrella Fund ("the Fund concerned"), is to be transferred to another Fund ("the transferee"); or(c) the operation of all or part of an Employee Money Purchase Scheme carried on in or from the DIFC is to be transferred from an operator that is an Authorised Firm (“the firm concerned”) to another person (“the transferee”).”
108. Application for an order sanctioning a scheme(1) An application in relation to a firm may be made to the Court for an order sanctioning a transfer scheme. An application may be made by:
(a) the firm concerned;(b) the transferee; or(c) both.(2) An application in relation to a Fund may be made to the Court for an order sanctioning a transfer scheme. An application may be made by:
(a) the Fund concerned;(b) the Fund Manager, Trustee or auditor of the Fund concerned; or(c) the transferee.(3) The Court may grant such orders if it considers that, in all the circumstances of the case, it is appropriate to sanction the transfer scheme.
109. Rights to be heard
On an application under Article 108, the following are entitled to be heard:(a) any person who alleges that he would be adversely affected by the carrying out of the scheme; and(b) the DFSA.
110. Powers of the Court in relation to a transfer scheme(1) If the Court makes an order sanctioning a transfer scheme, it may by that or any subsequent order make such provision (if any) as it thinks fit:(a) for the transfer to the transferee of the whole or any part of the undertaking concerned and of any property or liabilities of the firm concerned(b) for the continuation by (or against) the transferee of any pending legal proceedings by (or against) the firm concerned;(c) with respect to such incidental, consequential and supplementary matters as are, in its opinion, necessary to secure that the scheme is fully and effectively carried out;(d) for dealing with the interests of any person who, within such time and in such manner as the Court may direct, objects to the scheme;(e) for the dissolution, without winding up, of any firm concerned; or(f) for the reduction, on such terms and subject to such conditions (if any) as it thinks fit, of the benefits payable under:(i) any insurance policy, or(ii) insurance policies generally, entered into by the firm concerned and transferred as a result of the transfer scheme.(2) An order may:(a) transfer property or liabilities whether or not the firm concerned otherwise has the capacity to effect the transfer in question;(b) make provision in relation to property which was held by the firm concerned as trustee; or(c) make provision as to future or contingent rights or liabilities of the firm concerned, including provision as to the construction of instruments under which such rights or liabilities may arise.(3) If an order makes provision for the transfer of property or liabilities:(a) the property is transferred to and vests in, and(b) the liabilities are transferred to and become liabilities of,the transferee as a result of the order.(4) If any property or liability included in the order is governed by the law of any jurisdiction other than the DIFC, the order may require the firm concerned, if the transferee so requires, to take all necessary steps for securing that the transfer to the transferee of the property or liability is fully effective under the law of that country or territory.(5) Property transferred as the result of an order under this Article may, if the Court so directs, vest in the transferee free from any charge which is (as a result of the scheme) to cease to have effect.(6) An order under this Article which provides for the transfer of property is to be treated as an instrument of transfer for the purposes of any DIFC Law requiring the delivery of an instrument of transfer to register property.
111. Requirements of a scheme(1) Subject to Article 111(4), an application under Article 108 in respect of a scheme shall be accompanied by a report on the terms of the transfer scheme ("a scheme report").(2) A scheme report may be made only by a person:(a) appearing to the DFSA to have the skills necessary to enable him to make a proper report; and(b) nominated or approved for the purpose by the DFSA.(3) A scheme report must be made in a form approved by the DFSA.(4) The DFSA may, by written notice to the firm concerned, direct that a scheme report need not be provided, if it appears to the DFSA that, by reason of urgency, it is in the interests of the DIFC so to do.(5) The firm concerned must give written notice of the proposed transfer to all interested parties, such parties to be determined by the DFSA, to their last known mailing address.(6) The firm concerned must advise of the proposed transfer by way of a notice published in an appointed newspaper. An appointed newspaper is a publication best suited to bring the proposed transfer of business to the attention of any persons who may be affected by the transfer.(7) The DFSA may, by written notice to the firm concerned, direct that notice as prescribed in Articles 111(5) and (6) need not be provided, if it appears to the DFSA that, by reason of urgency, it is in the interests of the DIFC so to do.(8) The Court may not determine an application under Article 108 if the applicant or the firm concerned have failed to comply with the requirements in Article 111.
112. Conditions for sanctioning a transfer scheme
Before the Court may make an order for a transfer scheme, it must be satisfied that, before the transfer scheme takes effect, the transferee:(a) will have the authorisation required (if any) to enable the business which is to be transferred to be carried on in the place to which it is to be transferred; and(b) will possess adequate financial resources to carry on the business concerned in accordance with the legislation applicable in the place to which it is to be transferred.
The DFSA Board of Directors may make Rules providing for prescribed provisions of this Part to have effect in relation to prescribed cases with such modifications as may be prescribed.