Law firm Ogier outlines the key points of Jersey's proposal to create a more integrated approach to the regulation of investment fund service providers.
The Jersey Financial Services Commission (the JFSC) has just released a proposal for transitioning the regulation of investment fund service providers from the existing 'fund-by-fund' system to a more integrated approach under the Financial Services Law. This proposal is the culmination of an industry wide consultation process and is intended to provide a simplified regulatory regime to industry with effect from July 2007.
It is expected that the proposed changes will lead to a number of benefits for the regulation of Jersey investment funds. In particular the following should be noted:
- By providing an integrated legislative framework under a revised Financial Services (Jersey) Law the regulatory position of service providers and functionaries to funds will be simplified. In particular, moving away from a 'fund-by-fund' regulatory procedure to an approach based on regulatory service providers will reduce the number of applications required in relation to new fund structures and will remove the need for regulatory permits to be held in respect of each investment fund.
- The JFSC will introduce codes of practice for fund services business consistent with the current codes of practice for financial services business.
- In relation to existing structures, grandfathering will apply so that existing service providers will automatically be transitioned into the new regime.
- The proposal changes will simplify the regulation of investment funds and service providers in Jersey and are expected to result in a reduction in the regulatory burden on Jersey funds.