The purpose of the legislation is to regulate mutual funds and the managers and administrators who provide administrative support services to mutual funds. The objective is to attract mutual funds business to Anguilla by providing a reasonable regulated environment.
Essentially the Act is a much improved version of the British Virgin Islands Act.
Public funds, private funds and professional funds are regulated.
A public fund is defined as one making an invitation to the public, or any section thereof, to purchase shares and which is not a private or a professional fund.
A private fund is defined as one with a limited number of investors and whose constituent documents specify that the invitation to purchase shares is to be made on a private basis.
A professional fund is one whose shares are available for purchase only to professional investors; defined by the Act as persons whose ordinary business involves dealing in investments.
For public funds, the Act provides detailed provisions on the requirements for publishing a prospectus, as well as specifying requirements for an annual audit and other annual filings with the Registrar of Mutual Funds.
The procedures for securing fund approval under the Act are quite streamlined. Barring complications, approval is obtainable within a short period of time.
The application procedures for private and professional funds are straightforward and considerably less onerous than for public funds. It should be possible to obtain approval for a private or professional fund within two weeks of application.
Administrators and Managers of funds must also apply for licenses – essentially a background check and their qualifications.