Laws of Macau
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Decree-Law no. 83/99/M
of 22 of November
(Unofficial translation, for reference only)
CHAPTER I - Scope and definitions
Article 1 - Scope
Article 2 - Definitions
CHAPTER II - Investment funds in general
Section I - General provisions
Article 3 - Types of funds
Article 4 - Prior authorisation
Article 5 - Constitution
Article 6 - Domicile
Article 7 - Assets
Article 8 - Ownership
Article 9 - Liability for debts
Article 10 - Prudential limits
Article 11 - Temporarily exceeding the prudential limits
Article 12 - Forbidden acquisitions
Article 13 - Management liquidity
Article 14 - Risk
Article 15 - Rates of profitability and risk indexes
Article 16 - Liquidation and distribution
Article 17 - Compulsory liquidation
Article 18 - Liquidation proceedings
Article 19 - Safeguard of abroad assets
Article 20 - Supervision fee
Section II - Participation units
Article 21 - Types and form
Article 22 - Issuing
Article 23 - Subscription
Article 24 - Placing agencies
Article 25 - Redemption
Article 26 -Suspending issue and redemption or only redemption
Article 27 - Calculating the value
Article 28 - Use as guarantee or bond
Article 29 - Marketing abroad
Section III - Management of investment funds
Article 30 - Management
Article 31 - Management regulations
Article 32 - Amendments
Article 33 - Relevant experience
Article 34 - Reserved activity
Article 35 - Manager duties
Article 36 - Forbidden operations to fund managers
Article 37 - Relationship between the manager and the depository
Article 38 - Liability of fund manager and depository
Article 39 - Replacement of the fund manager
Article 40 - Discretionary managers
Article 41 - Remuneration of services
Section IV - Deposit of assets
Article 42 - Depository
Article 43 - Deposit of assets of investment funds
Article 44 - Depository duties
Article 45 - Purchase of participation units by depository
Article 46 - Replacement of depository
Article 47 - Bankruptcy of depository
Section V - Prospectus, report and accounts and publications
Article 48 - Informative prospectus
Article 49 - The informative prospectus content
Article 50 - Report and accounts
Article 51 - Publications
Article 52 - Reports to AMCM
Section VI - Closed-end funds
Article 53 - Issuing and subscription
Article 54 - Refusal of authorisation
Article 55 - Listing on stock exchange
Article 56 - Publication of value
Article 57 - Acquisition of participation units by the fund manager
Section VII - Funds Family
Article 58 - Nature
Article 59 - Management regulations
Article 60 - Informative prospectus
Section VIII - Investment funds domiciled abroad
Article 61 - Marketing
Article 62 - Advertising
CHAPTER III - SIF
Section I - Portfolio composition and prudential limits
Article 63 - Regime
Article 64 - Portfolio composition
Article 65 - Prudential limits
Section II - Money Market funds
Article 66 - Name
Article 67 - Composition
Section III - Funds of funds
Article 68 - Characterisation
Article 69 - Composition
Article 70 - Funds managed by a singly fund manager
Article 71 - Information
CHAPTER IV - Real Estate Funds (REF)
Section I - Regime and assets
Article 72 - Regime
Article 73 - Assets
Article 74 - Assessment of real estate assets
Section II - Purchase of assets and forbidden acquisitions
Article 75 - Purchase of real estate assets
Article 76 - Forbidden acquisitions
Section III - Prudential limits and temporary limits exceeding
Article 77 - Prudential limits
Article 78 - Temporarily limits exceeding
Section IV - Property assessment and registration of rights
Article 79 - Property assessment
Article 80 - Registration of rights
CHAPTER V - Investment funds management companies (FMC)
Article 81 - Object
Article 82 - Regime
Article 83 - Authorisation
Article 84 - Termination of authorisation
Article 85 - Form
Article 86 - Share capital
Article 87 - Assignment or transfer
Article 88 - Management body
Article 89 - Incompatibilities
Article 90 - Office premises
Article 91 - Other office premises
Section III - Activity
Article 92 - Net situation
Article 93 - Own funds
Article 94 - Access to the inter-bank market
Article 95 - Transfers
Article 96 - Foreign exchange operations
Article 97 - Contacts with organisations abroad
Article 98 - Supervision fee
CHAPTER VI - Final and transitory provisions
Article 99 - Enforcement
Article 100 - Tenors extension
Article 101 - Publication of AMCM´s notices
Article 102 - Discipline
Article 103 - Temporary provision
Article 104 - Commencement
Investment funds are, in modern societies, important ways of attracting savings and promoting economic development. In effect, by dividing the risk across a variety of assets held in their portfolios and by providing the potential for better returns on investment than other capital investment options, they attract investors and thus they contribute to stimulate the economic life.
The management of this kind of instruments requires a high level of professional learning, namely about the running of the financial markets and the regulation of respective operators’ activity. On the other hand, being that management carried out in the interest of third parties, the withholders of the participation units, must that management be committed to organisations submitted to supervision, properly qualified to continuously evaluate the risk of placements and to correctly ascertain the value of the managed funds.
Investment funds and respective management companies, inasmuch regulated, can contribute to develop local economy. Under these terms;
After hearing the opinion of Monetary and Foreign Exchange Authority of Macau;
After hearing the Consultative Council;
The Governor hereby decrees, under the terms of article 13, paragraph 1 of the Macau Organic Statute, that the following shall be enforced as law in the Territory of Macau:
Scope and definitions
1. This law shall regulate the constitution and operation of investment funds and investment funds managing companies.
2. Specific law regulates private pension funds.
1. For the purpose of this law, the following meanings shall be understood:
a) Investment fund: autonomous collection of assets comprising a portfolio diversified according to a principle for spreading risks, and generated by the investment of capital obtained from the public, by the purchasing, by these one, of participation units representing the value of that collection of assets;
b) Participation unit: equity representing each part of equal value into which the net assets of an investment fund are divided;
c) Participant: individual or corporate person who owns one or more participation units in an investment fund;
d) Securities investment fund, herein after briefly designated by SIF: investment fund consisting fundamentally of securities or other equivalent assets;
e) Securities: shares, bonds and similar assets, of whatever nature or form of representation, even if only as uncertificated securities, issued by any public of private organisation or person in homogenous groups that give the bearers identical rights and which can be traded on an organised market;
f) Assets equivalent to securities: the economic rights that can be separated from these values so long as they can be traded independently, and other financial instruments contained in standard time contracts, namely futures and options, when they have as object, directly or indirectly, securities, interest rates, foreign currencies or, also, indexes for securities, interest rates or foreign currencies;
g) Futures: time contracts whose object are, directly or indirectly, as considered assets, securities, real estate, or commodities traded in a sock exchange, with real or theoretical nature, or equivalent rights, interest rates, foreign currencies, or indexes on those assets, interest rates and foreign currencies, by which the parties make an adjustment between them, under the terms and accordingly to the kind of liquidation defined in the contract, to be obliged:
(i) To execute the material operation, in the date of the respective maturity, with the payment by the buyer of the stipulated price on the considered assets, against the delivery of those assets by the seller;
(ii) Or, only, to the payment, by the buyer to the seller or by this one to that one, depending on the case, of the difference between the agreed price and a price used as reference determined in accordance with the rules of the market in which the contract was made;
h) Options: time contracts whose object are, directly or indirectly, as considered assets, securities, real estate, or commodities traded in a stock exchange, with real or theoretical nature, or equivalent rights, futures, interest rates, foreign currencies, or indexes on those assets, interest rates and foreign currencies, by which one of the parties, till the date of maturity of the contract or in that date, by its only initiative and according to the kind of liquidation defined to execute the operation, is entitled:
i) To buy (buying option) or to sell (selling option) to the other party the considered assets, at the price and quantities agreed to that effect (effective price);
ii) Or to demand the mere financial liquidation of the contract, being the other party obliged to pay her, if it is a selling option, the positive difference eventually existing between the effective price and a price for reference calculated in accordance with the indicators of the market to the date of liquidation; or, if it is a buying option, the negative difference eventually existing between the two prices.
i) Real estate fund, herein after shortly designated by REF: investment fund consisting fundamentally of real estate assets;
j) Real estate assets:
i) Any rights on real estate properties that, according to the terms of this law, can be acquired to REF;
ii) Shareholdings above 50% of the share capital of companies whose scope of business is buying, selling, leasing, management and profitable exploitation of premises and whose exclusive commercial business scope is one or more of those activities.
k) (Does not exist in the Portuguese version);
l) Certificated securities: those securities which are incorporated in a material document;
m) Uncertificated securities: simply book-entry securities represented by inclusion in open accounts held in the name of the respective bearers, through which their nature, characteristics, legal status and all transaction in which they are involved and the exercise of the relevant property rights are proven in the appropriate launches and annotations;
n) Asset markets: the whole of organised markets controlled by the relevant authorities where securities are transacted;
o) Primary market: the whole of organised markets, through which the issuing organisations place their securities and distribute them by the investors;
p) Secondary market: the whole of markets organised to allow the purchase and the sale of securities after their distribution to the investors trough the primary market;
q) Manager: a bank, finance company, management company or other organisation legally authorised to administer one or more investment funds, namely to exercise the rights inherent to the values contained in the respective assets, as well of others described in the present law and in the management regulations of those funds;
r) Depository: a corporation that safeguards assets of an investment fund as well as the respective participation units, when certificated, or to carry out the respective registration when uncertificated, as well other functions described in the present law and in the management regulations;
s) Placing agency: organisation contractually responsible for placing participation units of an investment fund on the market for public subscription;
t) Investment funds management company, herein after shortly designated by FMC: a company that has the exclusive commercial business scope the management of one or more investment funds, on behalf and in the interest of the respective participants;
u) Financial intermediaries: Any people or organisations, individuals or corporations, public or private, legally qualified to offer professional services involving specific financial brokerage on money, financial or foreign exchange markets, such as portfolio management, deposit of securities, placement on markets, purchase and sale of securities and accepting orders from investors for these securities and markets;
v) Issuing entities: public or private entities that issue securities;
x) Investors: individuals or entities, public or private, that by themselves or through others place in a short or long time, in securities, commodities or real estate assets, the savings and other financial resources owned by themselves;
z) Competent authorities: individuals or entities, public or private, in charge of the organisation or the working of the markets or of the control of the activities there performed and the enforcement of respective legal provisions and regulations, as well the supervision of the respective operators.
2. Other definitions:
a) Open-end fund: investment fund consisting of a varying number of participation units which can be redeemed at their updated value;
b) Closed-end fund: investment fund consisting of a fixed number of participation units which can only be redeemed when this fund is liquidated;
c) Income fund: investment fund whose management regulations make provision for distribution of income generated to investors on a quarterly, half-yearly of other basis;
d) Growth or capitalisation fund: investment fund whose management regulations make provision for the automatic reinvestment of profits generated, increasing the value of the portfolio and not distributing income;
e) Money markets fund: open end investment fund whose investment policy in securities is geared towards highly liquid assets;
f) Fund of funds: investment fund consisting exclusively of participation units in other investment funds;
g) Funds family: group of investment funds administered by a same manager, aimed at giving investors advantages in simultaneously redeeming and buying shares in the investment funds belonging to that group;
h) Discretionary manager: organisation located outside the Territory which on the basis of a contract manages part of an investment fund portfolio;
i) Abroad custodian: organisation located outside the Territory which, on the basis of a contract with the management company or discretionary manager safeguards part of the portfolio of an investment fund;
j) Offshore investment fund: investment fund that meets the following requirements:
i) the respective investment portfolio consists of assets issued by organisations with head offices abroad;
ii) the assets in the respective portfolio and also the participation units are represented in a currency other than the pataca;
iii) the respective participation units are intended for purchase exclusively by non-residents.
l) Pension funds: investment funds that are intended for exclusively financing one or more pension plans;
m) Pension plans: programs defining the conditions for the constitution of the right to receive one regular payment by retirement, permanent disability to work, serious disease, long unemployment and other identical situations specially previewed;
n) FSAM: The Financial System Act of Macau approved by Decree-Law no. 32/93/M of 5th July;
o) AMCM: Macau Monetary and Foreign Exchange Authority.
Investment funds in general
(Types of funds)
1. Investment funds can be open-end or close-end funds.
2. Can exist, as kinds of SIF open-end funds, money market funds and funs of funds.
3. Can be constituted types of funds specialised, namely according to the possibility or not of periodical distribution of income, level of the risk of placements, nature of financial instruments to be used and the economic sector or geographic sector targeted.
1. Prior authorisation from AMCM is required to establish an investment fund.
2) Entities wishing to establish an investment fund shall submit to AMCM the following documents:
a) Initial application requiring authorisation for the constitution of the fund and describing its general aspects and its economic viability as well of their respective programs for launching and management;
b) A statement by the management entity accepting the rights and obligations inherent to the fund management and to watch for the full compliance of the management regulations;
c) A statement by the depository, accepting the rights and obligations inherent to the fund’s assets custody;
d) Draft of the management regulations;
e) Draft of the informative prospectus;
f) Draft of contracts between the fund manager and the depository as well as the placing entities, if it is the case;
g) Economic feasibility study.
3. AMCM can request the applicant organisation to provide additional information and order changes, it deems necessary, in the draft of management regulations, in the draft of prospectus and in the drafts of contracts related with the fund.
4. AMCM, after a favourable decision, shall provide the publication in the Official Gazette, at expenses of the applying entity, of an informative notice with the contents of the authorisation and the full version of the management regulations.
5. The refusals of the application are notified to the application entity without, under the terms and for the legal effects, without the need of publication.
1. After the publication referred to in article 3, section 4, the fund manager shall have 90 days to offer the participation units for subscription by interested public and it shall inform AMCM of the date selected for this purpose, and the investment fund shall be regarded as constituted in that same date.
2. If the subscription is not launched on the date indicated in preceding paragraph or if, within 6 months following the date of its constitution, the investment fund has still not attained the minimum number of thirty participants and the minimum value of five million patacas, the respective authorisation shall expire.
1. Investment funds are considered as domiciled in the place indicated in the respective management regulations.
2. Investment funds constituted in the Territory must be domiciled here.
The whole of assets of investment funds shall comply with the conditions and prudential limits referred to in present law, namely in what respects to the nature of assets that can be included in their portfolio, the forbidden acquisitions and the prudential limits.
Investment funds belong, under the special regime of common property regulated in this law, to the group of legal and corporate persons participating in them,.
(Liability for debts)
The assets of investment funds are not responsible for the individual debts of participants, managing entities, depositories, placing agencies, or the organisations involved in the process of their issuing and subscription.
Fund managers shall comply with the prudential limits defined in the present law to the different kind of assets that shall compose the portfolio of investment funds, accordingly to the nature of the considered fund.
(Temporarily exceeding the prudential limits)
1. The prudential limits described in this law for the composition of the funds portfolio can only be temporarily exceeded as a result of:
a) Exercising the rights of subscription or retrieval pertaining to the securities included in the investment fund;
b) Other exceptional reasons beyond the control of the fund manager and which cannot be resolved by it.
2. If, under any circumstances, the limits described in this law are exceeded, the fund manager must, as its priority, rectify this situation within a maximum period of six months.
1. The following may not be purchased for inclusion in the portfolio of investment funds:
a) Any assets not allowed by the nature of the fund under consideration;
b) Any property that is the object of real guarantees, distrained, or subject to cautionary proceedings or any way pledged;
c) Participation units in any kind of investment fund managed by the same fund manager or by any other management organisation linked to the former through any relationship of control or within a group;
d) Assets issued or held by the fund manager;
e) Assets issued or held by organisations that directly or indirectly hold 10% or more of the fund manager’s share capital;
f) Assets issued or held by organisations in which 20% or more of the equity belongs to the fund manager or to a company that directly or indirectly controls the same organisation, or by organisations directly or indirectly controlled by the fund manager;
g) Assets issued or held by individuals belonging to the management body of the fund manager, or here perform the functions of secretary, executive direction, auditing, management or head of department, or perform any of those functions in a company that directly or indirectly controls the same;
h) Assets issued or held by organisations in which 20% or more of the equity belongs to one or more members of the management body of the fund manager or here perform functions of secretary or executive direction, auditing, management or head of department, or any person that have identical functions in a company that directly or indirectly controls the same;
i) Assets issued or held by companies, on whose management body, one or more members of the board of the fund managers or the secretary or any person with functions of executive direction, auditing, management or head of department sit;
j) Assets placed on a market according to a placement contract involving the depository, the fund manager or organisations that directly or indirectly hold 10% or more of its share capital;
k) (Not used in the Portuguese version);
l) Precious metals, real estate assets, commodities, works of art or goods of an identical nature, nor certificates representing these goods.
2. The provision of sub-paragraph c), of previous section, is not applicable to the participation units of investment funds special addressed to a geographic or economic sector whose acquisition is expressly mentioned in the management regulations of the acquiring fund and if there are not charged any commissions for issuing or redemption in the respective operations.
3. The previous sub-paragraph i) of section 1 is not applicable in the case of assets issued or guaranteed:
a) By the Territory, local municipal councils or other local public bodies;
b) Securities issued or underwritten by a state or territory, or other public bodies from abroad so long as investment in this kind of security is expressly indicated in the management regulations;
c) Securities issued by international public organisations or bodies linked to these.
4. Selling, use or burden, by any way, of the assets of the investment fund to organisations referred to in paragraph 1, sub-paragraphs e) to i), is subject to the previous authorisation of AMCM, by explaining application by the fund manger.
The investment funds portfolio shall include sufficient liquidity resources to deal with:
a) The normal level of cashing in of participation units;
b) The fund’s current administration expenses;
c) The regular implementation of the investment policy described in the management regulations.
1. The managing regulations, the informative prospectus, and the subscription form of an investment fund must include an underlined information about the respective level of risk.
2. AMCM may issue instructions on the criteria for definition of the risk of investment funds and the terms of the information referred to in previous section.
(Rates of profitability and risk indexes)
AMCM may regulate the terms and conditions in which fund managers can publicise in any way, the measures or indexes of profitability and risk of funds and the rules to be observed in calculating these measures and indexes.
(Liquidation and distribution)
1. Participants in open-end funds cannot demand their liquidation or distribution.
2. Participants in closed-end funds can demand their liquidation so long as:
a) Provision has been made for this eventuality in the management regulations;
b) The management regulations make provision for listing the respective participation units on a stock exchange and this has not occurred within months counted from the constitution of the fund;
c) After listing on a stock exchange, the participation units have been removed and are not returned for listing within a period of 6 months.
3. In the cases described in paragraph 2, the established deadline needs not to be observed, if the decision to liquidate is taken by unanimous decision and with the involvement of all participants in the fund.
1. AMCM may order the compulsory liquidation of a fund when:
a) There is repeated violation of the management regulations or the failure to observe, over long periods of time, the prudential limits and values established in present law;
b) Operations in violation of article 12 have been executed;
c) The value of the participation units is less than 50% of the initial issuing value when the fund was constituted;
d) Any other situation occurs that can affect seriously the participant’s interest.
2. Notification of the decision referred to in the preceding paragraph shall imply the immediate suspension of subscriptions and redemption, and the commencement of liquidation procedures
1. The liquidation of investment funds shall follow the terms referred to in the management regulations, and should be conducted by the respective fund manager, or in case of its impeachment, by a person expressly appointed for this purpose by AMCM.
2. The notice of liquidation is compulsory published, with a previous minimum period of 60 days since its beginning, in the Official Gazette and in two newspapers with major circulation in the Territory, being one in each of the official languages.
3. AMCM, after hearing the liquidator and the depository, sets a period for the conclusion of liquidation proceedings.
4. Following expiry of the deadline referred to in the preceding paragraph, the liquidator must submit the liquidation accounts to AMCM for its approval.
(Safeguard of abroad assets
1. The fund manager shall ensure that the safekeeping of fund abroad is committed to suitable entities, duly authorised and submitted to supervision of competent authorities.
2. The same custodian shall keep the assets of a same fund localised abroad in a certain financial market place.
1. An annual supervision fee on the investment funds is due to AMCM, equivalent to 1‰ on the net value of the fund at the end of the period to which the fee refers.
2. The supervision fee is paid by the fund manager and charged to the assets of the fund.
(Types and form)
1. Participation units may:
a) Be represented in bonds of one or more units each;
b) Be certificated or uncertificated.
2. The fund manager may convert into uncertificated the certificated participation units, after gaining authorisation from AMCM.
3. The registration and control of uncertificated participation units shall be regulated in a notice by AMCM
Participation units may not be issued unless the sum of money corresponding to the issue price is effectively included in the fund’s assets, except in the case of dividing existing units.
1. Participation units shall be subscribed at the counters of the fund manager, the depository, or, under contract, through other placing agencies previously contracted by trhe fund manager.
2. Two copies of the subscription form shall be completed, one of which shall be given to the participant.
3. The subscription form must contain, other than an underlined information about the level of risk of the fund referred to in paragraph 1 of article 14, the full reproduction of the management regulation, or, if that information is not included, must be given a copy to the subscriber when he subscribes.
4. The management regulations shall state whether the subscription is made at the most recent known, publicised value of the participation unit on the date of subscription, or at the value calculated in the first subsequent assessment.
5. Subscribing the participation units implies that the participant accepts the management regulations and gives the fund manager the necessary powers to engage in the administration of the fund.
1. The placing agencies referred to in paragraph 1 of the preceding article engage in business on behalf of the fund manager and in compliance with the contract signed with the same organisation, the terms of which should mention the services related to the subscription that they undertake to provide, and the corresponding remuneration.
2. In carrying out their business, placing agencies are subject to the law regulating the execution of the same transactions by depositories, and the fund manager shall be solidaritly liable to participants for losses caused by the acts and omissions of the former.
3. In the case of a placing consortium, the depository of the fund’s assets must be the respective leader.
1. Participants may require the cash of their participation units they hold in open-end investment funds by addressing a request to the management organisation, and repayment shall be made within the period established in the management regulations.
2. The value of the participation unit, calculated under the terms of the next article, must, for the purposes of redemption, correspond to the most recent value known and publicised on the date of the respective request or on the date which it refers to, unless the management regulations state that this value should be the first subsequent assessment or that of the date of repayment.
3. In the case of closed-end funds, participation units can only be paid out when the fund is liquidated.
(Suspending issue and redemption or only redemption)
1. When there are 5% more requests to redeem participation units than to subscribe to them in a single day, or if these requests exceed 10% of the total value of the fund over a maximum five days period, the fund manager can order subscription and redemption, or only redemption transactions, to be suspended.
2. The fund manager must order issuing and redemption transactions, or only redemption, to be suspended when protecting the interests of investors makes this advisable, even if the circumstances described in the preceding paragraph do not exist.
3. The suspension described in previous paragraphs 1 and 2 and the reasons leading to the same must be immediately communicated by the manager to the depository, to the placing agencies and to AMCM, who establishes a maximum deadline for the suspension.
4. The decision of suspension must specify if implies or not the suspension of redemption, but if the subscription is to be continued, only can go on under a written statement of each participant that he had prior acknowledgement of the decision of suspension.
5. Once a decision has been taken to suspend redemptions, the fund manager must post a notice in a clearly visible location in the premises of the depository and in all other places where the participation units are marketed, informing the public of the same decision and, as soon as possible, of its duration.
6. AMCM can order, by its initiative or by request of the manager, when occur extraordinary circumstances able to disturb the normal operation of the of the investment fund or to risk the legitimate interests of participants, the suspension of the operations of subscription and redemption, or only the redemption, of the respective participation units.
7. The suspension referred to in previous paragraph is immediately communicated by AAMCM, by hand delivered written notice, to the manager, to the placing agencies and to the depository.
8. The suspension of redemption as described in the preceding paragraph shall come into effect immediately and shall be applied to all requests for redemption that have not been satisfied as of the notification from AMCM.
9. The suspension described in paragraph 1 an 2 shall only be applied to the applications received after the day of the receipt, in AMCM, of the communication referred to in paragraph 3.
10. The disposition of paragraph 4. Is also applicable to the suspension ordered by AMCM.
(Calculating the value)
1. The value of the participation unit is calculated on a daily basis except for Saturdays, Sundays and holidays observed by the local banking sector.
2. The calculation of the value of the participation units is determined by dividing the total net value of the investment fund by the number of participation units subscribed.
3. The management regulations must state the time of day to be used as the reference for calculating the value.
4. The criteria for measuring the value of the securities in the investment fund portfolio are contained in a notice issued by AMCM.
(Use as guaranty or bond)
When are to be used as guarantee or as a bond requested by law, the participation units are equivalent to security or bonds listed in a stock exchange.
3. The managing entities that intend to market, abroad, the participation units of investment funds domiciled in the Territory must give previous notice of that fact to AMCM.
4. The decision of liquidating funds or of the suspension of the issuing and redemption, or only of the redemption, of the participation units of investment funds marketed abroad is immediately communicated by AMCM to the competent authorities of countries or territories where those funds are being traded.
5. The managing entities shall guarantee, to the participants non resident in the Territory, the due payments, the redemption of the participation units and the diffusion of the information that must be provided.
(Management of investment funds)
1. The management of investment funds may only be carried out by the entities referred to in subparagraph q) of paragraph 1 of article 2.
2. The functions of manager and depository of a single fund cannot be combined in a single organisation.
3. A same manager is not allowed to manage simultaneously a SIF and a REF.
4. The management of investment funds must be prudent, subordinated to criteria of great professional diligence and capacity and carried out in the best interest of participants.
5. Managing entities of investment funds can use skills and financial instruments to hedge the risk, namely futures and options, with the purpose of the adequate administration of the portfolios.
Each fund shall have its own management shall contain, namely, the information referred to in the Annex A of the present law.
1. Any amendments to the management regulations are subject to prior authorisation by AMCM.
2. AMCM, after approval, orders the publication, in the Official Gazette, at cost of the manager, of a notice with the contents of the approved amendments.
3. Amendments to the management regulations resulting in higher commissions to be paid by investors or by the fund, or a change in the investment policy shall come into force 90 days following publication in the Official Gazette.
The staff of fund managers in charge of managing operations must have enough experience, being used as reference the exercise of those functions during a period of 5 years in an institution submitted to supervision and considered suitable by AMCM.
It is prohibited the usage of words or expressions in a proprietorship name or in a company’s name in course of its activity, which could suggest carrying out the activity of investment fund management, by other than the entities referred to in subparagraph q) of paragraph 1 of article 2.
The fund manager acts on behalf of investors and in their exclusive interest, and it is generally responsible for carrying out all acts and operations required, or appropriate for the good administration of the fund, according to criteria of extreme diligence and professional competence, particularly:
a) Issuing participation units, in conjunction with the depository, and authorising their redemption;
b) Selecting the assets that should make up the fund in accordance with the investment policy described in the respective management regulations, and carrying out, or instructing the depository to carry out the appropriate operations required for implementing this policy;
c) Buying or selling any assets and carry out the directly or indirectly related with the assets of the fund, including the sub contracting of discretionary managers and custody of assets abroad;
d) Assessing the value of participation units;
e) Maintaining the fund’s accountancy books in order;
f) Complying with the duties to provide information established by law or in the management regulations.
(Forbidden operations to fund managers)
1. Fund managers are expressly forbidden to:
a) Contract loans on their own behalf;
b) Contract loans on behalf of the funds they administer, unless in exceptional situations and when these are short loans lasting no longer than one hundred and eighty days, and amounting to a maximum of 10% of the total value of the relevant fund;
c) Pledge the fund’s assets in any manner, except to obtain the loans referred to in the preceding sub-paragraph;
d) Purchase participation units in another fun they administer, on their own behalf, except in money-market funds;
e) Purchase other securities of any kind on their own behalf, apart from those of public indebtedness, equity papers and debentures of companies listed on a stock exchange internationally recognised;
f) Without affecting the provisions of the preceding sub-paragraph, grant credit, including surety, on behalf of the investment funds they administer;
g) Purchase on their own behalf real estate beyond the limits of their own funds;
h) Carry out, on its own account or that of the funds, unhedged sales of securities;
i) Carry out operations, on the account of the managed investment funds, that could provide to them as well as to the participants, a controlling position on any company.
2. Those fund managers that are credit institutions are not subject to the provisions of sub-paragraphs a), d), e) and g) of paragraph 1 or, when they act on their own behalf, to the provisions contained in sub-paragraphs f) and
g) of the same paragraph.
3. For the purpose of the described in the subparagraph e) of paragraph 1, AMCM defines by a Notice to be published in the Official Gazette the countries and territories to be considered to that, and the minimum rates of risk required, by reference a classifications made by companies internationally recognised.
(Relationship between the manager and the depository)
1. The relationship between fund manager and depository is governed by written contract and a copy of the same and of any amendments should be sent to AMCM, as well of the respective amendments.
2. The members of the board of directors of the fund manager, or the persons there in charge of functions as executive directors, head of departments, or chief managers, cannot perform any kind of functions in the entity in charge of the function of depository nor those of this one in the previous one.
3. The manager and the depository can be a subsidiary of a same entity.
4. The manager cannot be a subsidiary of the entity in charge of the functions of depository nor this one in that one.
(Liability of fund manager and depository)
1. Fund managers and depositories must, in the course of their duties, act independently and in the exclusive interest of the participants.
2. Fund managers and depositories are solidarly liable to participants, under the terms of the law and the management regulations, for the fulfilment of all commitments contracted in exercising their respective duties.
3. The fact that fund managers or the depository may have entrusted part or all of their duties to a third organisation cannot be invoked as a cause for excluding themselves from liability.
(Replacement of the fund manager)
1. In the case of revocation or termination of the authorisation granted to the fund manager, of its temporary closing, or of its submission to exceptional measures, AMCM shall appoint other managing entity to take the administration of the considered investment funds.
2. The decision of appointment of the new manager is sufficient entitlement to take all the rights and obligations, as well to take possession of the assets belonging to the investment funds managed by the previous fund manager.
The fund manager shall ensure that contracted discretionary managers are suitable and duly authorised and submitted to the supervision of competent authorities.
(Remuneration of services)
1. The remuneration of the services provided by the fund manager and the depository and may include the following:
a) A management commission to be paid periodically by the investment fund and intended to cover all management expenses;
b) An issue commission to be paid by the subscribers and intended to cover the expenses of issuing and selling participation units;
c) A redemption commission, to be paid by the respective participants and intended to cover the expenses of redeeming the participation units;
d) A deposit commission, to be paid periodically by the fund and intended to remunerate the services of the depository.
2. Those expenses relating to the purchase and sale of assets on behalf of a fund , including the fees and commissions paid, to that purpose, to third parties, are costs of the same funds.
Deposit of assets
1. Depository of the assets of the investment fund must be an institution registered with AMCM.
2. Can carry out the functions of a depository:
a) Credit institutions authorised to operate in the Territory with a paid up capital and reserves not less than 150 million patacas;
b) A subsidiary of a credit institution with a paid up capital and reserves not less than 10 million patacas, not being, in this case, the institution withholder of the majority of capital give it up without prior authorization from AMCM.
(Deposit of the assets of the investment funds)
1. The assets of a single fund in the Territory should be entrusted to the safekeeping of a single depository.
2. In no case the deposit of assets of an investment fund shall imply the transfer of property to the depository, nor can this one use those assets for different purposes other than resulting from the contract of deposit.
1. The functions of the depository are these defined in the present law, in the management regulations and in the cintact with the fund amnager.
2. The depository is namely responsible for the following:
a) Receiving the fund’s assets as deposits, or registering the fund’s securities, depending on being certificated or uncertificated;
b) Carrying out all purchases and sales of fund securities ordered by the fund manager, transactions involving levying interest, dividends and other yields produced by the same, and transactions relating to exercising other asset entitlements relating to the same securities;
c) Receiving and processing requests for subscription and redemption of participation units;
d) Paying participants their dividends in the fund’s profits;
e) Maintain chronological records of all transactions carried out up to date, and establish a detailed quarterly inventory of the securities in its safekeeping;
f) Adopt a supervisory role and guarantee, to participants, that the fund management regulations are being complied with, particularly with regard to the investment policy.
3. The depository should also:
a) Ensure that the sale, issue, repayment and cancellation of participation units is done in accordance with the law, the management regulations and the contracts signed;
b) Ensure that the value of the participation units is calculated according to the law and the management regulations;
c) Carry out the instructions of the fund manager, unless these are against the law or the management regulations;
d) Receive, within the deadlines set by market practice, the return on transaction relating to the fund’s assets for which it is depository;
e) Ensure that the profits of the fund are invested according to law and the management regulations;
f) Prepare an informative report, to be included in the annual report of the fund manager, about the accomplishment, or not, by this one of the managing regulations.
(Purchase of participation units by depository)
The depository may purchase participation units of the fund on whose behalf it carries out its duties, in order to give the respective fund manager liquidity essential for pursuing management, not being allowed, however, to purchase participation units already issued.
(Replacement of depository)
1. The fund manager shall submit to AMCM the replacement of the depository whenever the economic situation of this one, his performance, his intention to renounce to his functions or the serious threat of the interest of the participants shall that advise.
2. AMCM must grant authorisation prior to replacing the depository and such authorisation must be published in the Official Gazette at least 15 days before the date on which the replacement comes into force.
3. The decision of authorisation referred to in previous paragraph is a competent title to the new depository to take possession of all assets kept by the former depository.
(Bankruptcy of depository)
1. If the depository becomes bankrupt, the securities deposited cannot be included in their proceeds and all securities must be separated and submitted to AMCM which, after checking them and consulting the fund manager, shall submit them to another reliable depository.
2. Fund managers and owners of participation units entrusted to the safekeeping of a bankrupted depository are entitled to request that their participation units be separated and returned under the applicable terms of the Macau Code of Civil Procedure.
Prospectus, report, accounts an publications
1. The fund manager must draw up and keep updated, in its essential aspects and related to each investment fund, an informative prospectus and keep it available for consultation by interested people on its premises and in the offices of the depository and in the premises of the other organizations involved in placing and marketing the investment fund.
2. The initial prospectus and any subsequent amendments are subject to prior approval of AMCM.
3. All advertising campaigns relating to a fund must state the prospectus referred to in this article exists and indicate the places where this can be obtained.
(The informative prospectus content)
1. The informative prospectus shall include the necessary information to allow the investors to have a correct idea about the investment proposed to them, and shall be offered to the investors prior to the subscription.
2. The informative prospectus shall include, namely, the information described
in the annex B of this law, of which is integrant part.
3. AMCM may regulate in a notice the various aspects of the prospectus contents and how they are presented to the public.
(Report and accounts)
1. Investment funds annual accounts shall be closed each year on the 31st of December.
2. The annual report and accounts shall be submitted to an external auditor acceptable to AMCM for its report, and this auditor must indicate its opinion of the fund manager’s assessment of the securities included in the investment fund’s assets.
3. The report mentioned in the preceding paragraph must contain:
a) A description of the activities during the respective business year;
b) An indication of the places where the annual report and accounts can be consulted;
c) The information listed in Annex C attached to this law;
d) Other relevant information that allows investors to reach an informed decision as to the progress of business and the results of the fund.
1. In the 2 months following each semester of the year, the fund manager must publish a half-term report containing the information listed in Annex C attached to this law, being possible the use of the report related to the second semester in the years report for the purpose of described in the subparagraph c) of paragraph 3 of previous article.
2. The half-term reports referred to in previous paragraph shall be made available to interested people and sent to those participants who request a copy, at no charge.
3. Fund managers must publish a quarterly report in the Official Gazette indicating the composition of each fund’s investments, their respective total value and the number of participation in circulation, taking the last day of the month immediately preceding as the reference date.
4. Fund managers must publish the balance sheet and profit and loss account for fund along with the report and opinion of an external auditor by 30th April of each relevant year.
(Reports to AMCM)
Fund managers shall send to AMCM, 10 working days ahead of the date to de publication or disclosure:
a) A copy of the monthly balance sheets indicating their status and that of the funds they manage;
b) A copy of the year’s closing report and accounts;
c) A copy of the informative prospectus and respective amendments.
(Issuing and subscription)
1. In the case of closed-end funds, only the number of participation units set in the management regulations can be issued and subscribed, without affecting the provisions of the following paragraph.
2. Following authorisation by AMCM, permission may be granted to increase or reduce the equity of closed-end funds so long as provision is made for this in the management regulations.
3. Subscription of participation units in closed-end funds may be either public or private.
(Refusal of authorisation)
When the interest of investors so requires, may be denied the authorisation to the constitution of new closed-end funds, while not fully subscribed the capital of other closed-end funds managed by the same management organisation.
(Listing on stock exchange)
Participation units in closed-end investment funds can be officially listed on a stock exchange once all the participation units have been placed.
(Publication of value)
The value of fully subscribed participation units of closed-end funds must be published monthly in the Official Gazette, taking the last day of the month as reference date. Being the variation over the figures for the previous month greater than 3%, the new value shall be published in the Official Gazette, as soon as possible.
(Acquisition of participation units by fund managers)
Closed-end funds managers are allowed, when not management companies, to buy participation units of the funds they are managing up to 25% of the global value of the fund.
1. Investment funds families can be constituted to be administered by the same fund manager and aimed to give participants advantages in the simultaneous redemption and subscription of participation units in that funds families.
2. Investment funds belonging to a funds family shall comply with the open-end type fund described in this law, and they may not be marketed outside the family.
Funds belonging to a funds family shall have single management regulations that must comply, regarding each one of those funds, with the provisions of this law and indicate the special conditions for subscription and redemption of respective participation units.
A single prospectus can be drafted for all funds contained in a funds family.
Investment funds domiciled abroad
1. Advertising and marketing in Macau of participation units in investment funds domiciled abroad or administered by a fund manager with its head office abroad is subject to prior authorisation from AMCM.
2. Authorisation shall only be granted if the investment funds have been duly authorised in their country of origin and the respective fund managers and custodians are subject there to supervision by the competent authority.
Any promotion in the Territory of investment funds domiciled abroad shall mention the respective fund manager and the supervisory authority controlling them, with the respective contact addresses, and it must also observe the legal provisions relating to advertising.
Portfolio composition and prudential limits
The constitution and operation of SIF are regulated by the dispositions of the present chapter, and, in everything that is not against it, by the dispositions of Chapter II.
1. Within the limits and conditions of this law, the assets of a SIF shall consist of:
a) Securities officially listed on a stock exchange or other regulated market that operates on a regular basis, as identified in the management regulations;
b) Recently issued securities so long as the issuing conditions include proof or the commitment that a request will be submitted for listing or dealing on a stock exchange or market referred to in sub-paragraph a);
c) The following assets located in the Territory:
ii) Bank deposits;
iii) Public treasure bonds;
iv) Mortgage debentures;
v) Shares and bonds from companies hold fully or in majority by the government of a country of or a territory;
vi) Shares and bonds of companies incorporated in the Territory;
vii) Participation units in other investment funds;
viii) Transferable certificates of deposit;
ix) Placements in the local interbank market;
x) Other instruments representing debt, that are transferable and negotiable, which are liquid and whose value can be assessed precisely at any time.
xi) Other movable property than those mentioned in previous subparagraphs, previously authorised by AMCM.
2. If the securities referred to paragraph 1, sub-paragraph b) are not accepted for listing on a stock exchange within a period of one year, they should be sold in six months.
3. In duly justified cases, AMCM may authorise an asset structure that is different from that defined in this article.
4. AMCM may, in a notice, define technical rules concerning the assets structure of SIF, and the characterisation of the assets to be purchased for the same.
1. The portfolio of SIF shall not include over 10%
a) In shares issued by a single company;
b) In bonds issued by a single organisation;
c) Instruments of debt issued by a single organisation hold fully or in majority, directly or indirectly, by the government of a country of or a territory;
d) In the total participation units issued by another investment fund, unless in a case of a fund of funds or a fund family.
2. The portfolio of a SIF shall not include more 10% in securities or other movable property issued by a single organisation that, totally, can represent more than 10% of the global value of the considered fund.
3. The limit referred to in previous paragraph shall be raised to 35% in the cases referred to in subparagraphs a) and c) of paragraph 3 of article 12.
4. The percentages referred to in paragraph 1 must be observed as from the first 6 months following the date of incorporation of the investment fund.
5. Any situation involving a failure to meet the above conditions due to a shift in the market values of the securities in the portfolio, or due to participants in open-end investment funds exercising their right to repayment, should be rectified within a maximum period of 6 months.
Money market funds
The name of a money market fund must contain the expression “money market fund”.
In what respects to the money market funds, the following must be observed:
a) They shall always include, at least, 35% of their overall value invested in securities whose residual maturity date is less than twelve months;
b) Their resources cannot be invested in shares, convertible bonds, or bonds giving the right of subscription to shares, or to purchase shares under another title, in debt subordinated securities or in equity papers shares and bonds from companies hold fully or in majority by the government of a country of or a territory;
c) Cannot be purchased participation units of investment funds whose management regulations do not prohibit the investment in assets referred to in subparagraph b).
Funds of funds
2. Funds of funds are open-end SIF.
3. The name of a fund of funds shall contain the expression “fund of funds”.
1. Resources of funds of funds shall be invested in participation units in other funds, without prejudice of the referred to in article 12.
2. The assets of a fund of funds shall not be invested in:
a) Participation units of other funds of funds;
b) More than 20% of their total assets Funds of funds may not invest in a single fund;
c) More than 30% of assets of funds of funds may not be invested in funds administered by a single fund manager, without prejudice of the provisions of next paragraph.
(Funds managed by a singly fund manager)
Fund managers may constitute funds of funds including only participation units in funds administered by the fund of funds manager, or by a management organisation that controls this one or is a member of the same group, so long as these funds are identified in the fund of funds management regulations and no commissions are levied for respective issuing or redemption operations.
1. The management regulations of funds of funds, the prospectus and the advertising material shall show the characteristics of the funds in which is intended to invest their resources.
2. The management regulations of funds of funds must include a general description of all chargeable costs concerning the funds in which they are intended to be invested and expected to be directly or indirectly paid by participants.
Regime and assets
The constitution and running of real estate funds are governed by the provisions of present chapter, and, in all that is not against them, with necessary adaptations, by the dispositions of Chapter II.
Within the limits and conditions of the present law, assets of real estate funds can only include:
c) Bank deposits;
d) Public debt treasuries;
e) Bonds of companies listed on a stock exchange internationally recognised;
f) Mortgage bonds;
g) Instruments of debt issued by a single organisation hold fully or in majority, directly or indirectly, by the government of a country of or a territory;
h) Participation units in other investment funds, securities or real estate investment funds;
i) Placements in the inter bank market;
j) Other assets special authorised by AMCM.
(Assessment of real estate assets)
To determine the value of participation units, the value of a premise is its market selling value, assessed according to the best price that it could worth if sold, under normal conditions of market, in the moment of the assessment.
Purchase of assets and forbidden acquisitions
(Purchase of real estate assets)
May be purchased to the real estate funds, within the conditions and limits described in present law, the following rights on real estate property localised in the Territory:
a) Rights on private property or on parts of urban premises under the regime of horizontal property;
b) Assignment rights on leasing or aforamento on land under public domain designated to urban building construction.
More than the forbidden acquisitions referred to in article 12, cannot be purchased to a REF:
Premises or their autonomous parts that:
a) After acquisition, remain under a regime of co-ownership with third parties;
b) Are being used in a proposal other than that described in the utilization licence.
c) Rights on premises not under the private property regime.
Prudential limits and temporarily limits exceeding
1. The portfolio of open-end real estate funds must comply with the following limits relating to their global liquid value:
a) A minimum of 5% shall be composed by cash, bank deposits, treasuries issued by Territory and placements in the inter-bank market;
b) A minimum of 75% shall be composed by non-movable property;
c) A maximum of 10% may be composed by rights on land reserved for accomplishment of building construction programs;
d) A maximum of 20% may be composed by shareholdings in companies whose commercial object is exclusively the purchase, sale, lease, management and profitable use of premises.
2. More than 20% of the net value of a same real estate fund cannot be placed in a single undertaking.
3. The incorporation, in the assets of a real estate fund, of bonds, mortgage bonds, participation units or participation bonds, issued by a third party, is subject to the limit of 10% of the global value of the issuing of the considered security by that party.
4. The described in the previous paragraph is not applicable to the acquisition of the assets referred to in sub-paragraphs a) to c) of paragraph 3 of article 12.
5. The percentages referred to in sub-paragraphs a) and b) of paragraph 1, as well as the referred to in paragraph 2 are also applicable to the closed-end real estate funds.
6. The percentages referred to in sub-paragraphs a) and c) of paragraph 1 shall be observed since the beginning of the third annual exercise of the fund.
(Temporarily limits exceeding )
In the case of temporary excess of limits referred to in previous article, is applicable the disposed in article 11, being the deadline for regularisation 1 year.
Property assessment and registration of rights
1. The purchase of properties to REF and their transfer of ownership must be proceeded of the opinions of, at least, two independent experts appointed by common agreement between the fund manager and the depository.
2. The properties must be evaluated, at least, yearly and whenever their value changes significantly, and the assessed value cannot exceed that of the highest price given by experts’ evaluation.
3. Is also submitted to the experts evaluation, under the terms of paragraph 1, the accomplishment of building projects, so that can be assured that the investment is not exceeding the market selling value of the premises to be built.
4. AMCM can issue, in a notice, the technical rules on the experts’ qualification and on the evaluation criteria to the assets to be included in REF.
(Registration of rights)
The inscription of rights on properties acquired to a real estate fund is made according to the terms of paragraph 3 of article 88 of the Estate Property Registration Code, with exemption of the identification, being mentioned the fund’s name in place of.
FMC are commercial companies whose exclusive corporate object is the management of one or more investment funds on behalf of the respective participants.
1. The incorporation and activity of FMC, are regulated by the provisions of the present chapter, and by the applicable provisions of Section III of Chapter II.
2. Are also applicable, with the necessary adaptations, the provisions of FSAM related to supervision and supervision fee (articles 4 to 14), authorisation, registration shareholders (articles 22 and 35 to 45), management (articles 47 to 52), and amendments of articles of association.
1. The incorporation of FMC depends on the prior authorisation of the Governor, to be granted by executive order.
2. The file applying for authorisation to incorporate a FMC is delivered to AMCM, who is in charge to give previous advice on the application.
3. In the executive order referred to in paragraph 1, specific conditions can be set for each authorisation, within the limits of the law.
(Termination of authorisation)
1. The authorisation granted for the incorporation of IFMC terminates if
a) The applicants renounce it, expressly;
b) The company is not incorporated within six months counted from the effective date of the respective authorisation or does not start her activity within the same tenor;
2. The terminates also if, in the period of operation:
a) The company suspends her activity, with closure to the public, for a tenor over six months, continuously or with interruptions in a period of 1 year;
b) When the value of net worth is less than the minimum share capital and has not been rectified within 6months.
3. The tenor referred to in sub-paragraphs b) of paragraph 1 and in subparagraphs a and b of paragraph 2 could be extended by the entity who has granted the authorisation, once ore more times, on well explained application from the interested parties.
1. The FMC should be incorporated as public limited company.
2. The shares of FMC are nominal or registered to the bearer.
1. The FMC shall not be incorporated or thereafter carry business if its share capital is less than 3 million patacas.
2. At the time of incorporation, the share capital must be fully subscribed and paid in cash in the act of incorporation.
(Assignment or transfer)
The assignment or transfer of equity participation, in any way, depends on prior approval of AMCM
The board of FMC shall contain at least two executive members resident in the Territory.
It is forbidden the members of the management bodies of IFMC and other people that maintain working relationship with them, be it labour contract or delivering services contract, or perform any functions in other investment fund management companies.
The FMC should carry on their activities in premises adequate to their objectives and with ease access to the public.
(Other office premises)
FMC are not alwoed to have other offices in the Territory, other than the main office.
Opening branches or representative offices abroad shall be previously approved by AMCM.
1. The balance of net situation of FMC can not be less than the value of the share capital required by law.
2. When the balance of net situation becomes less than the share capital required by law, the situation shall be corrected within a six months period.
AMCM shall define, by notice, that the own funds of FMC shall be, at any moment, more than a certain percentage of the global value of the managed portfolios.
(Access to the inter-bank market)
IFMC may, in performing their business, have access to the inter-bank market.
1. The FMC should have in credit institutions operating in this Territory one or more bank accounts for the fund movements related with their activities, and the assets of each fund must be always segregated, in their own accounts, from the assets of the FMC.
2. The cash remittances from or to the Territory and related with the activity of FMC are to be made through credit institutions.
(Foreign exchange operations)
The IFMC are allowed to execute the foreign exchange operations strictly needed for carrying out their business.
(Contracts with organisations abroad)
1. Whenever the FMC deals with abroad, they should sign a contract with the entities there, who are also authorised to carry on, in their respective countries or territories, the necessary operations for the fulfilment of the FMC objective.
2. The entities referred to in previous paragraph shall be authorised, in their respective countries, the operations necessary to perform the corporate objective.
3. The FMC should maintain in file, with translation to any one of the official languages, a copy of the contracts that, for the implementation of their objectives, they sign with entities abroad authorised to carry on the same activity.
The annual supervision fee to be paid by FMC is 3% of the amount required for their company's minimum legal share capital.
Final and transitory provisions
The enforcement of the dispositions of the present law is committed to AMCM.
In exceptional cases, AMCM can extend, once or more times, the tenors established in the present law.
(Publication of AMCM´s notices)
The notices issued by AMCM previewed in the present law are published in the Official Gazette.
To the violations of present law are applicable, with the necessary adaptations, the dispositions of Title IV of FSAM
Shall adapt to the new regime within a period of one year:
a) Investment funds constituted or marketed in the Territory on the date of implementation of this law;
b) The organisations that perform the management or commercialisation of investment funds.
This Decree-Law shall come into force in the first day of the month following its publication.
Approved on the 18th of November of 1999
To be gazetted.
Vasco Rocha Vieira
Dispositions to be included in management regulations
The management regulations must indicate, at least:
1. The name fund;
2. Its duration;
3. The name and head office of the fund manager;
4. The name and head office of the depository;
5. Rights and obligations of participants, fund managers, and depository;
6. Any provision for constituting discretionary managers and custodians abroad;
7. Any organisations that, in addition to the fund manager and the depository, may be allowed to market the participation units;
8. The fund’s investment policy, in terms of identifying its goals, the degree of risk and specialisation if any, in terms of sector or geographical regions, and the limits of indebtedness;
9. The principles of management of portfolios and for hedging risk;
10. The limits for indebtment;
11. The moment of the day that shall be used to issue the value og the participation units;
12. The value, method of calculation and conditions for charging commission for issuing, management, redemption and others;
13. The method for deciding the issue and redemption price of participation units;
14. The maximum deadline or period for completing redemption of participation units, that can not be over 1 year;
15. The conditions under which the issue and redemption of participation units can be suspended;
16. The policy for distributing the income from fund, defined objectively, so as to clarify, in particular, whether this is an equity fund, or a dividend fund offering total or partial distribution of profits and if so, which criteria are adopted for such distribution, or whether the distribution policy of the fund is to be decided annually by the fund manager;
17. All charges, other than those relating to management commission and deposit, must be paid by the fund, namely expenses involving the purchase and sale of securities on behalf of the fund;
18. The maximum fees to be charged by the fund manager and by the depository;
19. The minimum number of participation units that can be purchased in each subscription;
20. The level of risk of the investment fund, with a call of attention salient and adjusted to the respective rate of risk;
21. In the case of closed-end funds, the management regulations must also indicate the value of the share capital and the number of shares.
22. The conditions of liquidation of the fund;
23. Other information that may be required by AMCM.
Information to be provided in the informative prospectus
(Article 49 - no. 2)
I. Information about the investment fund
2. Date on which it was constituted;
3. Indication of place where the management regulations and periodic reports can be obtained;
4. Indication of the applicable fiscal regime and whether or not gains are kept at source or profits are distributed amongst investors;
5. Date on which accounts are closed and frequency of profit distribution, if relevant;
6. Indication of external auditor referred to in article 50, paragraph 2;
7. Indication of the stock exchanges or markets where the participation units are traded, if relevant;
8. Description of the rules for deciding results and how they are applied;
9. Description of the investment fund’s investment goals, investment policy and its limits and the policy to be pursued in terms of contracting loans;
10. Rules for measuring values;
11. Form for assessing the value of the participation units, more specifically the subscription price and redemption price:
11.1 Indication of the fees charged for purchasing, issuing and redeeming shares;
11.2 Indication of places and frequency with which this value is published;
11.3 An salient reference to the term of redemption;
12. Identification of investment consultants, if relevant, and the essential elements of the respective service contract that could be of interest to participants;
13. Information of the manner and place of payments due to investors, for the purposes of distributing profits or redeeming participation units.
II. Information about the fund manager
1. Name, legal form and head office;
2. Date on which it was constituted, and duration, if limited;
3. Indication of other investment funds managed by the same fund manager, if relevant;
4. Identification and indication of position of the members of the board and principal activities in which they engage outside the fund manager so long as this is significant and could in any way interfere with its activities;
5. Capital underwritten and fully paid up capital.
Information to be provided in the Periodic Reports
(Article 50, paragraphs 3, subparagraph c) - Article 51, paragraph 1)
1. Number of participation units issued, redeemed and in circulation in the period in question.
2. Table showing comparative value of participation units.
3. Inventory of portfolio divided into the following categories:
3.1 Securities officially listed on a stock exchange;
3.2 Securities traded in other regulated markets;
3.3 Recently issued securities referred to in article 64, paragraph 1, subparagraph b);
3.4 Other securities; not included in previous subparagraphs.
4. Indication of profits distributed and reinvested;
5. Indication of movements in the participation units account;
6. Explanation of potential gains and losses;
7. Information about other relevant situations that could affect the investment fund’s assets;
8. Comparative table showing the close of each other the three last reference periods (semester or financial year, depending on the case), indicating:
8.1 Overall value of Investment Fund;
8.2 Value of each share.
9. Indication, if relevant, of operations carried out in the conditions
described in Article 50, paragraph 2.