Ireland: ISE - Guide To Continuing Obligations Of Investment Funds

Introduction

A fund is obliged to comply with the continuing obligations requirements of the Irish Stock Exchange ("ISE") for the duration of its listing and must also fulfil certain requirements of EU directives. The purpose of this memorandum is to provide you with a useful and user-friendly guide to the on-going requirements of a listing on the ISE. This guide serves as a summary of the continuing obligations requirements, full details of which are described in the ISE's Code of Listing Requirements and Procedures for Investment Funds (the "Code"), a copy of which may be downloaded from www.ise.ie.

Continuing obligations role

In our capacity as fund sponsor, Walkers Listing & Support Services Limited ("WLSS") liaises with the ISE on a fund's behalf in relation to its continuing obligations. Our continuing obligations role includes:

  1. Advice on application of the ISE's continuing obligations requirements.
  2. Drafting announcements for the fund's review and approval.
  3. Reviewing content of shareholder circulars to assess compliance with relevant rules.
  4. Liaising with the ISE, when necessary, where announcements or circulars must be pre-approved prior to release to shareholders.
  5. Reviewing annual reports and accounts.
  6. Ensuring filing deadlines for announcements, circulars and financial reports are met.
  7. Advising and resolving apparent breaches of listing rules when raised by ISE.
  8. Providing the fund with confirmation, upon request, that the fund is in compliance with the continuing obligations requirements.

All final announcements, circulars and reports filed by WLSS on behalf of a fund will be released through the Company Announcements Office ("CAO") of the ISE, via the ISE's on-line announcements platform, www.isedirect.ie.

Open communication

Walkers operates an open-door policy and is happy to answer any query, however big or small, to ensure that a fund best complies with its obligations to the ISE. In this regard we recommend that, upon listing, a fund establishes key contacts within its administrator, legal advisers or investment manager who will be responsible for liaising with Walkers on an on-going basis. We then strike a strong working relationship with the fund's contacts to develop reliable communication channels.

Continuing obligations requirements

General obligation of disclosure

A fund must notify the ISE of any new price sensitive information without delay. In addition, a fund must be aware of its obligations under the Market Abuse Directive, in particular in relation to disclosure of insider information; maintenance of insider lists and manager transactions.

Notification relating to capital

A listed fund must notify the CAO immediately of the following changes to its capital:

  1. Alterations to the fund's capital structure.
  2. New issues of debt securities.
  3. Changes of rights attached to listed shares.
  4. Any issues affecting conversion rights.

Issues and redemptions of shares, in the normal course of business, are not required to be disclosed.

Notification of interests in shares

A fund is required to disclose, without delay, the interests of:

  1. any person who is deemed to be a controlling shareholder; and
  2. the investment management entity in the listed shares of the fund.

Where a listed fund is subject to the Irish Companies Act 1990, it must disclose any necessary information.

The Market Abuse Directive requires any interest of a director, connected person or person discharging managerial responsibility in the listed shares of a fund to be notified to the markets in a timely manner. Such interests must be disclosed by completion of the following two forms which must be provided to a fund within four business days of the transaction date.

  1. Directors Dealing form, which must be filed with the ISE, and
  2. PDMR Form (Persons Discharging Managerial Responsibility), which must be filed with the Central Bank of Ireland, as competent authority in Ireland under the Market Abuse Directive.

The fund must then forward the completed forms, via Walkers, to the CAO and Central Bank of Ireland within one business day of receipt.

Notifications relating to a fund's operations

A fund must notify the CAO without delay of information relating to the operations of the fund. Some matters may require the pre-approval of the ISE and additional time may need to be factored into the timing of the effective date of such matters. Appendix 1 sets out a list of the typical matters that trigger an announcement/notification to the ISE.

The ISE requires a fund to seek shareholder approval in advance of the implementation of certain matters and in such circumstances a fund is required to issue a circular that should:

  1. provide full details of the proposed matter to enable shareholders to make an informed decision;
  2. include certain standard disclosures required by the ISE; and
  3. not be circulated prior to the pre-approval of the ISE.

A circular must be sent to shareholders at least ten business days prior to the date on which the shareholder will vote or otherwise take action.

Rights as between shareholders

A fund is required to ensure equality of treatment of all shareholders who are in the same position. A fund is also obliged to notify the CAO without delay of any proposal to, or development which may, vary the class rights of shareholders. The use of side letters is permitted where certain confirmations are provided to the ISE.

Financial information

An annual report and accounts must be filed with the ISE within six months of a fund's financial year end and must address the annual report content requirements, as described in the Code.

Closed–end funds: additional continuing obligations

A closed-end fund must file its annual report and accounts within four months of the financial year end and its interim report within two months of the period end.

Two interim management statements must be filed during each financial year, advising of any material events or transactions that have taken place during the relevant period and their impact on the financial position of the fund.

A shareholder must notify the fund and the ISE of the percentage of voting rights he/she holds, either directly or indirectly, when the holding reaches, exceeds or falls below 5 percent, 10 percent, 15 percent, 20 percent, 30 percent, 50 percent and 75 percent.

A listed closed-end fund is required to comply with specific filing and publication timelines prescribed in the Transparency Directive and must file a copy of its interim management statements, and annual and interim reports, with the Central Bank in addition to its filings with the ISE. We keep close contact with our closed-end funds to ensure all deadlines are met.

Filing deadlines

Any matters that require announcement to the ISE must be filed with the ISE by 5.30pm on the date such matters are determined. If the matter is decided upon after 5.30pm, then the necessary announcement/circular must be filed prior to 10.00am the following morning.

An announcement or circular that requires the pre-approval of the ISE should be filed with the ISE at least three business days prior to its intended date of issue.

Appendix 1

Notifications relating to a fund's operations

A listed fund must notify the CAO, without delay, of the following information relating to the operation of a listed fund:

  1. Any proposal to, or development which may, vary the class rights of unitholders.*
  2. Any proposed or actual material change in the general character or nature of the operation of the listed fund.*
  3. Any proposed or actual material change in the investment policy and/or objective and investment strategy.*
  4. Any proposed or actual material change in investment, borrowing and/or leverage restrictions.
  5. Any material change in the valuation policy.
  6. Any material change in dividend policy.
  7. Any material change in the tax status of the listed fund.
  8. Any material change in the minimum subscription.*
  9. Any material change in the listed Fund's constitutive documents.*
  10. Any change in the financial year end of the listed fund.
  11. Any change in the frequency of calculation of the net asset value or any material change in the listed fund's redemption policy.
  12. Proposal to change or change in the open or closed ended status of the listed fund.*
  13. Any general suspension of redemptions, transfers or calculation of net asset value.
  14. The net asset value per unit, upon calculation.
  15. Any change in the names of the listed fund, sub-funds, classes or series.
  16. Any material changes in the fees payable by the listed fund or material change in its material contracts.
  17. Any intention or proposal to terminate or (where the listed fund is established for a finite period) to renew or extend the life of the listed fund.*
  18. Any change in directors or material change in any director's function. This announcement must be filed within 5 business days of the effective date of the appointment/resignation.
  19. Any change in sponsor, registrar, auditor or transfer agent.
  20. Any change in any administrator, investment manager, depositary or prime broker.*
  21. Any proposed transaction which is subject to Chapter 7 of the Listing Rules of the ISE.*
  22. Any proposed or actual transaction which would be treated as a transaction with a related party within the meaning of Chapter 8 of the Listing Rules.*
  23. Any dividend paid and to be paid when determined – the announcement should include details of the record date, the period covered and payment date for the dividend and of the amount of any such dividend.
  24. Notice of any Annual General Meeting or Extraordinary General Meeting.
  25. Any decision to cancel the listing of a listed fund, sub-fund, class or series.*

*Indicates matters that normally require the pre-approval of the ISE. Please contact us as early as possible on such matters.

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.

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