How Are Mutual Funds Licensed and Regulated in Barbados

Prepared by David King & Co, Attorneys at Law, Belleville Barbados

2010

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How are Mutual Funds licensed and regulated in Barbados?

The regulation, authorization and control of mutual funds and their managers and administrators carrying on business in, or from within Barbados are prescribed by the Mutual Funds Act, 2002-22 and the Mutual Funds Regulations, 2002.

A mutual fund may, upon application, be licensed to carry on business in or from Barbados where it has applied for and has been granted a licence under the Act, which is administered by the Barbados Securities Commission. The Act generally makes provision for three types of mutual fund licenses:

1. the mutual fund licence: this is a mutual fund licensed in Barbados;

2. the exempt mutual fund licence: this is a mutual fund which is licensed in a foreign jurisdiction (such as Trinidad and Tobago)and has not suspended operation in that jurisdiction and has been approved by the Minister responsible for Finance in Barbados; and

3. the limited investors licence: this is a mutual fund in which the equity interest are held not by more than 15 investors the majority of whom are capable of appointing or removing the operator of the fund and in the case where any of the investors is a corporation, that the corporation does not have more than 4 beneficial owners.

A mutual fund is required to inform the Securities Commission of any change of its registered office or its principal office, a change of its operator; or any material change to its structure, organization or administration within 7 days of the occurrence of such a change and to submit to the Commission in respect of a financial year:

a. a statement containing the prescribed information respecting its activities; and

b. its audited accounts

within 4 months after the end of the financial year or within such further period as the Securities Commission may allow.