Brexit – simplified approval procedure for fund marketing
Deregistration
The following legal grounds to market funds into Norway will cease as of 1 January 2021 for UK funds and managers
- The right to market UCITS funds established in the UK under the notification rules of the UCITS Directive
- The right to market UCITS funds established in an EEA country other than the UK, where the manager is established in the UK
- The right to market alternative investment funds established in the UK to professional investors in accordance with the notification rules of the AIFMD. This applies both where the manager is established in the UK and where the manager is established in an EEA country
- The right to market alternative investment funds established in an EEA country other than the UK to professional investors in accordance with the notification rules in the AIFMD if the manager is established in the United Kingdom
- The right to market alternative investment funds established outside the EEA to professional investors where the manager is established in the UK in accordance with AIFMD Article 36 (authorization regime)
The above funds will be automatically deregistered for marketing into Norway on 1 January 2021 unless they comply with the below approval process.
Legal basis
FSAN may grant authorization to market into Norway to:
- Funds established in a third country
- EEA funds managed by a manager established in a third country
Securities funds may be marketed to non-professional investors in accordance with the Investment Fund Act (IFA). UCITS funds which have previously been marketed into Norway under a UCITS passport will be eligible under this regime as they will be reclassified as third country alternative investment funds.
Alternative investment funds where the manager is established in a third country may be marketed to professional investors in accordance with the Alternative Investment Fund Managers Act (AIFMA) implementing AIFMD article 42.
Alternative investment funds established in a third country where the manager is established in the EEA, can be marketed to professional investors in accordance with AIFMA implementing AIFMD Article 36.
Simplified approval process under AIFMA/AIFMD
An existing authorization for a UK manager to market a third country AIF to professional investors in Norway under AIFMD Article 36 may be converted into an authorization under AIFMD Article 42. The same applies if the relevant fund is a feeder fund for a third country AIF.
The manager must inform FSAN of the intention to convert the authorisation, including clearly identifying the manager and fund (by specifying LEI and ISIN), and state when the authorisation under AIFMD Article 36 was granted. Also, the following must be confirmed:
- That the fund and the manager will continue to be subject to satisfactory supervision in the home state, and that the requirements that apply to conducting business in the home state are met
- That the manager will comply with the rules in the AIFMA Chapter 4 with regulations (implementing AIFMD Article 22, 23, 24 and 26 to 30)
- That the manager will do what is necessary in Norway to be able to make payments to investors, redeem units and provide the information that the manager must prepare in accordance with the rules in the United Kingdom
As a result of the conversion, the manager will become subject to reporting obligations to FSAN under AIFMD Annex VI.
Simplified approval process under IFA/UCITS
An existing notification for a UCITS fund established in the UK to market to investors in Norway pursuant to the UCITS Directive may be converted into an approval to market to non-professional investors under IFA. The same applies to UCITS funds established in another EEA country, with a UK manager.
In the application, the manager must clearly identify the manager and fund (by specifying LEI and ISIN), and state when the fund was notified for marketing in Norway. Also, the following must be confirmed:
- That the fund is classified as a UCITS fund until 31 December 2020
- That there are no plans to make changes to the fund’s characteristics from 1 January 2021, including in the investment mandate, the model for costs and redemption rights, compared with the fund’s characteristics as a UCITS fund
- That the fund and the manager will continue to be subject to satisfactory supervision in their home states
- That the requirements that apply to conducting business in the home state are met, including that the fund’s appointment of a custodian will be maintained
- That information about the fund will still be available to investors in Norway, including articles of association, prospectus, key information or equivalent
- That available fund documentation contains information on costs related to investing in the fund, including current management fees and costs of subscription and redemption
The application must also describe how the fund units will be sold in Norway, and how investors in Norway can redeem their units.
If the fund is also to be marketed to professional investors, an authorisation is also required in accordance with AIFMA (implementing AIFMD Article 42) and the simplified procedure for alternative investment funds set out above can be used.
How to apply
Applications for the simplified procedures set out above must be sent to post@finanstilsynet.no no later than 6 December 2020.