Guernsey: Channel Islands’ Stock Exchange Update

Last Updated: 15 March 2012
Article by Danny Cole

Originally appeared in Finance, Offshore – Winter 2012

The Channel Islands' Stock Exchange (the "CISX") was launched in 1998. Appleby Securities (Channel Islands) Limited is one of the founder members and continues to act as sponsor to many companies and investment funds listed on the exchange.

The CISX continues to flourish with 498 new admissions for the year ending 2011. Notwithstanding the challenging economic climate, additional capital raised through further issues by listed issuers during the year highlighted one of the potential benefits of being on the CISX Official List. Listed closed-ended funds raised additional capital of £88.5 million, whilst special purpose vehicles raised a further £204.8 million of additional capital in 2011 according to the CISX Executive Factfile.

Unregulated Closed-Ended Funds

The Market Authority of the CISX has recently announced that it would need to develop its policy in respect of unregulated funds given increased level of interest expressed by the CISX's members throughout 2011.

The CISX Listing Rules (the "Listing Rules") within Chapter VII were originally designed primarily with regulated funds in mind, the definitions of which are set out within the Listing Rules. However, it was clear (following consultation with CISX members) that these definitions needed to be updated in light of the regulatory changes that have come into effect in recent times, particularly the introduction of the registered funds regime in Guernsey.

Understandably, the CISX does not wish to be placed in a position where it needs to become the arbiter of quality or to have the exchange perceived as the regulator of an unregulated listed fund by virtue of its listing, and so the Market Authority has issued a carefully worded guidance note to its members with a view to introducing revised Listing Rules in due course (which will focus on Listing Rule 7.3.2 and the definitions of authorised and approved funds).

Guidance Note

The guidance note sets out the Market Authority's policy for applications in connection with unregulated closed-ended investment funds. It should be noted, that unregulated open-ended funds are still not acceptable to the Market Authority.

The Market Authority proposes to introduce changes to Listing Rule 7.3.2 which will help to clarify what conditions an investment fund comply with to be eligible for listing on the CISX. A fund must:

"i) be an authorised fund; or ["approved fund" has been deleted]

ii) be duly incorporated or otherwise validly established and regulated in a jurisdiction recognised for the purpose by the Exchange; or

iii) be otherwise acceptable to the Exchange."

The revised definition of an "authorised fund" within Chapter I of the Listing Rules will be an investment fund authorised or registered by the GFSC under The Protection of Investors (Bailiwick of Guernsey) Law 1987 (as amended); or recognised or certified by the JFSC under the Collective Investment Funds (Jersey) Law 1988 (as amended).

The guidance note discusses which types of investment funds fall under category (iii) above. The fund (not being an authorised fund or regulated in a recognised jurisdiction) would be "otherwise acceptable to the Exchange" where:

"1) the fund is unregulated, closed-ended (unregulated open-ended collective investment schemes are not acceptable) and;

2) the fund is incorporated in a jurisdiction recognised by the Exchange and;

3) the fund has a separate Investment Manager which is regulated in a jurisdiction recognised by the Exchange with a minimum of two years track record achieved whilst being regulated; and

4) reviews carried out as part of the application process on the Principals of the Fund (including the Investment Manager) are satisfactory."

Self Managed Funds without a Regulated Investment Manager

The Market Authority will review unregulated, closed ended, self-managed funds that have no regulated investment manager on a case by case basis and will take a number of factors into consideration.

These factors include considering the relevant expertise of the directors of the fund in relation to managing assets of the underlying investment type (within the context of fund management experience). Where it is deemed appropriate (i.e. the directors do not possess the relevant fund management experience in the relevant asset class), there must be a separate, independent investment advisor appointed that has suitable expertise and experience (to the satisfaction of the CISX utilising the two year track record principle noted above)

In addition to evaluating the experience of the directors, the application process may also require reviews to be undertaken on the principals of the fund (including all parties to the issuer and their principals (i.e. property manager, investment advisors and directors of the fund)) which must be satisfactory to the Market Authority.

The fund must also be incorporated in a jurisdiction recognised by the CISX.

Existing Listed Funds

The guidance note also draws attention to the fact that if an existing listed fund (whether regulated or otherwise) is suspended (or has pending regulatory or investor protection issues under advisement by the CISX), then further issues by the issuer or new applications for listing from the same source will not be considered appropriate by the Market Authority until the suspension is lifted or the investor protection issues are resolved to the satisfaction of the CISX.

Please note that the guidance note has been issued to its members "for information only" and may be amended by the CISX. For this reason, we would recommend seeking early consultation with the CISX on all aspects of suitability and eligibility of an application for the listing of an unregulated fund. The guidance note is however a clear and positive step taken by the exchange in response to its members' requests. These measures will hopefully lead to an increased number of funds listed on the CISX in 2012.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Danny Cole
In association with
Mondaq Advice Centre (MACs)
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.