This chapter applies in relation to dual-priced AUTs. Accordingly, in this chapter:
If, and to the extent that, the authorised fund manager and the depositary so agree, income units and accumulation units are to be treated, for the purposes in (b) as belonging to the same class of units.
The only purposes to which (a) can apply are:
ascertaining the number of units respectively to be issued or cancelled in order for the authorised fund manager to comply with CIS 15.3.4 R (3) (Issue of units to meet authorised fund managers obligation to sell) and CIS 15.3.7 R (3) (Cancellation and payment for cancelled units); and
Paragraphs (a) and (b) do not apply to the income units and accumulation units of an AUT unless the rights attached to those classes provide for their prices to be calculated by reference to undivided shares (howsoever called) in a manner similar to that resulting from CIS 2.6.1 R (Units and classes of units in AUTS).
This chapter helps in achieving the regulatory objective of protecting consumers as envisaged by sections 2 and 5 of the Act. In accordance with Principle 6 (customers' interests), this chapter is intended to ensure the manager pays due regard to its customers' interests and treats them fairly.
A manager is responsible for valuing the scheme property of the AUT it manages and for calculating the prices of units in the AUT. As well as arranging for the issue and the cancellation of units for the account of the AUT, the manager is permitted to sell and redeem units for its own account. The rules in this chapter are intended to ensure that the prices of units are properly related to the net value of the AUT and, in accordance with Principle 6 that the manager deals fairly with investors when they purchase or sellunits. This chapter provides common standards for these purposes.
Units of an AUT are issued or cancelled by the trustee on the manager's instructions. In the case of an issue, payment in cash of the issue price of the units or a transfer of assets of an equivalent value must be made to the trustee for the account of the manager concerned. Payment by the trustee for cancelled units is normally to be made in accordance with CIS 15.3.7 R (Cancellation of units).
A manager may hold units for its own account (in its box): so a purchaser of units from the manager may receive units which have been issued to the manager or that have been redeemed (that is repurchased) by the manager from a previous Unitholder. In addition to selling and redeeming units for its own account, the manager may arrange for the trustee to issueunits direct to an investor or to cancel a Unitholder'sunits.
Under this chapter the prices at which units may subsequently be issued or cancelled will be determined in accordance with CIS 15.3.6 R (Issue price) and CIS 15.3.8 R (Cancellation price) respectively and, in broad outline, will be calculated by valuing the scheme property attributable to the class of units in question on an issue basis or a cancellation basis (as appropriate) and dividing that value by the number of those units in issue. The valuation of the scheme property must be in accordance with CIS 15.8 (Valuation).
CIS 15.6.3 R (SDRT provision) provides the manager with the power to require, for the benefit of the AUT, the payment or deduction of a provision for stamp duty reserve tax as an addition to or deduction from (but not part of) the price of the units.