In December 2016, after three rounds of consultation and an effective date of 1 July 2018, the Central Bank of Ireland (CBI) issued guidance on Fund Management Company (FMC) Effectiveness. More commonly known as CP86. This provides guidance on how management companies, including Self-Managed Investment Companies (SMICs), should demonstrate good governance and oversight of funds.
Within two years of the implementation of CP86 the CBI completed its first round of themed inspections on several entities. On 20 October they issued a findings letter, otherwise known as the ‘Dear Chair’ letter.
AMX welcomes the publication of the letter which gives resolute evidence that as a jurisdiction, Ireland:
- takes substance and governance seriously
- has a very high standard of expectations to be followed
- remains one of the most robust international regulatory regimes
In particular, the letter provides clarity around the requirement to have at least three Full Time Employees (FTE’s). This means SMICs and legacy ManCos now have the correct level of information needed to address any substance deficiencies.
The magnitude of cost, including the requirement to have designated persons with appropriate experience, will mean that many of today’s SMICs or ManCos are no longer economically viable. As a result, it is likely that that FMCs will need to consider a Third-Party Management Company solution.
We can help you
AMX was authorised as an Irish ManCo in 2019 and meets the CBI’s requirements in providing Third-Party Management Company services to funds. We are authorised for both UCITS and AIFMD.
We are working with our industry clients, partners and contacts to assess the CBI’s findings and can help you move forward:
- Contact us for a copy of our extensive self-assessment questionnaire. The information you provide will be used to help us understand your day-to-day operational, resourcing and governance requirements against the CP86 requirements and Central Bank findings. This will be used to discuss relevant options with you during our initial meeting.
- Perform an appropriateness test of the recommendations
- Assist in the preparation of recommendations for the board
- Outlining the implementation process.
We look forward to helping you. If you would like to discuss how we could support you please get in touch.