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COLL 11.4 Depositaries

Information-sharing agreement between depositaries

COLL 11.4.1 R
  1. (1)

    An authorised fund manager of a feeder UCITS is responsible for communicating to the depositary of the scheme any information about the master UCITS which is required for the completion of the depositary's regulatory obligations.

  2. (2)

    Where a master UCITS and its feeder UCITS have different depositaries, the depositaries must enter into an information-sharing agreement in order to ensure fulfilment of their respective duties.

[Note: article 61(1) first and fourth paragraphs of the UCITS Directive]

Contents of the information-sharing agreement between depositaries

COLL 11.4.2 R
  1. (1)

    The information-sharing agreement referred to in COLL 11.4.1R (2) must include:

    1. (a)

      identification of the documents and categories of information which are to be routinely shared between both depositaries, and whether that information or those documents are provided by one depositary to the other or made available on request;

    2. (b)

      the manner and timing, including any applicable deadlines, of the transmission of information by the depositary of the master UCITS to the depositary of the feeder UCITS;

    3. (c)

      the co-ordination of the involvement of both depositaries, to the extent appropriate in view of their respective duties under national law, in relation to operational matters, including:

      1. (i)

        the procedure for calculating the net asset value of each scheme, including any measures appropriate to protect against the activities of market timing in accordance with COLL 11.3.6 R (Avoidance of opportunities for market timing);

      2. (ii)

        the processing of instructions by the feeder UCITS to purchase, subscribe or request the repurchase or redemption of units in the master UCITS, and the settlement of those transactions, including any arrangement to transfer assets in kind;

    4. (d)

      the co-ordination of accounting year-end procedures;

    5. (e)

      what details the depositary of the master UCITS must provide to the depositary of the feeder UCITS of breaches by the master UCITS of the law and the instrument constituting the fund2 and how and when those details will be provided;

      2
    6. (f)

      the procedure for handling ad hoc requests for assistance from one depositary to the other; and

    7. (g)

      identification of particular contingent events which ought to be notified by one depositary to the other on an ad hoc basis, and how and when this will be done.

  2. (2)

    Where a master-feeder agreement exists in accordance with COLL 11.3.2R (1) (Master-feeder agreement and internal conduct of business rules), the information-sharing agreement between the depositaries must provide that:

    1. (a)

      the law of the EEA State applying to the master-feeder agreement will also apply to the information-sharing agreement; and

    2. (b)

      both depositaries agree to the exclusive jurisdiction of the courts of that EEA State.

  3. (3)

    Where the master-feeder agreement has been replaced by internal conduct of business rules in accordance with COLL 11.3.2R (2) (Master-feeder agreement and internal conduct of business rules), the information-sharing agreement between the depositaries must provide that:

    1. (a)

      the law applying to the information-sharing agreement shall be either that of the EEA State in which the feeder UCITS is established or, where different, that of the EEA State in which the master UCITS is established; and

    2. (b)

      both depositaries agree to the exclusive jurisdiction of the courts of the EEA State whose law is applicable to the information-sharing agreement.

[Note: articles 24 and 25 of the UCITS implementing Directive No 2]

Notification of irregularities

COLL 11.4.3 R
  1. (1)

    Where a depositary of a master UCITS detects any irregularities with regards to the scheme which may have a negative impact on the relevant feeder UCITS, the depositary must immediately inform:

    1. (a)

      the FCA;

    2. (b)

      the feeder UCITS or, where applicable, its management company; and

    3. (c)

      the depositary of the feeder UCITS.

  2. (2)

    The irregularities referred to in (1) include, but are not limited to:

    1. (a)

      errors in the valuation of the scheme property performed in accordance with COLL 6.3.3 R (Valuation);

    2. (b)

      errors in transactions for or settlement of the sale, issue, repurchase or redemption of units in the scheme undertaken by the feeder UCITS;

    3. (c)

      errors in the payment or capitalisation of income arising from the scheme property, or in the calculation of any related withholding tax;

    4. (d)

      breaches of the investment objectives, policy or strategy of the scheme as described in the instrument constituting the fund,2 the prospectus or the key investor information; and

      2
    5. (e)

      breaches of investment and borrowing limits set out in COLL, the instrument constituting the fund,2 the prospectus or the key investor information.

      2

[Note: article 61(2) of the UCITS Directive and article 26 of the UCITS implementing Directive No 2]

COLL 11.4.4 G
  1. (1)

    When notifying the FCAof any irregularities in accordance with COLL 11.4.3R (1), the depositary of the master UCITS should also inform the depositary of the feeder UCITS how the master UCITS or its authorised fund manager has resolved or proposes to resolve the irregularity.

  2. (2)

    Where the depositary of a UCITS scheme that is a feeder UCITS is informed by the depositary of a master UCITS of an irregularity and is not satisfied that the resolution or proposed resolution is in the interests of the Unitholders of the scheme, it should promptly report its view to the authorised fund manager of the scheme, or in the case of an ICVC, the directors.

[Note: recital (16) to the UCITS implementing Directive No 2]

Disclosure by a trustee or depositary

COLL 11.4.5 G

Section 351A (Disclosure under the UCITS directive) of the Act provides that where a trustee of an AUT or the depositary of an ACS1 which is a master UCITS or a feeder UCITS, or any person acting on their behalf, makes a disclosure to comply with rules implementing Chapter VIII of the UCITS Directive, that disclosure is not to be taken as a contravention of any duty to which the person making the disclosure is subject. The OEIC Regulations (see regulation 83A) contain corresponding provisions for the depositaries of ICVCs that are feeder UCITS and master UCITS.