Operating licences of UCITS mangement companies

Only management companies authorised by the Central Bank of Iceland (CBI) may manage and market UCITS, cf. Act No. 116/2021 (in icelandic) on Undertakings for Collective Investment in Transferable Securities (UCITS).

A UCITS is an undertaking for collective investment whose sole object is to raise capital from the public for collective investment in financial instruments and other transferable assets, on the basis of risk-spreading and in accordance with a previously disclosed investment policy, and whose units are, at the request of unit-holders, repurchased or redeemed, directly or indirectly, out of the undertaking’s assets, cf. Point 26 of the Paragraph 1 of Article 3 of the Act.

An application for authorisation as a UCITS management company must be submitted in writing and accompanied by the required information, cf. Chapter II of the Act.

A management company may also, subject to specific authorisation, provide the following services. In providing such services, the company must comply with Act No. 115/2021 on Markets in Financial Instruments:

1. Asset management.
2. Investment advice.
3. Safekeeping and administration of units or shares of collective investment undertakings.

The CBI supervises the activities of management companies and UCITS, cf. Chapter XIII of the Act.

As part of the processing of an application for authorisation as a management company, the CBI assesses the fitness and propriety of the company’s board members and managing director pursuant to Article 11 of the Act, cf. Articles 52 and 52a of Act no. 161/2002 (in icelandic) on Financial Undertakings.

As part of the processing of an application for authorisation as a management company, the CBI may be required to assess whether its shareholders are suitable to hold a qualifying holding pursuant to Article 13 of the Act, cf. Chapter VI of the Act on Financial Undertakings.