Saint Vincent and the Grenadines: Offshore Legal and Tax Regimes
Regulation of Mutual Funds
Mutual funds are regulated by the Mutual Funds Act, 1997 as amended by the Mutual Funds (Amendment) Act 1998, and regulations issued in 1999. The act provides for the licensing of both domestic and offshore mutual funds. Licenses are granted either as a private and accredited fund or as a public fund. A public fund can offer any shares it issues for subscription or purchase to any interested member of the general public. All public funds registered must publish a prospectus and file it with the International Financial Services Authority. There are no capital adequacy requirements or minimum subscription limits placed on public funds. Public funds must maintain accounting records and financial statements. Public funds that intend to do business with residents must also submit an offering document synopsis to the IFSA.
Private and accredited funds either must have no more than fifty investors, or issue shares on a private basis. An accredited fund issues shares only to accredited investors, with an initial investment of not less than USD25,000. An accredited investor is one who has a net worth in excess of USD1 million.
Mutual funds can be formed as an incorporated company, a partnership or a unit trust. Umbrella funds, open ended, closed ended and integral funds are permitted. Administrators and managers must apply to the regulator for a license to carry on business as administrators or managers. A natural person, any mutual fund, company, trusts or trustee may apply for a license to carry on business as administrators or managers. Applicants must show evidence that they have the expertise and resources to carry out a mutual fund business.