Bank of Russia approves basic standard for protection of rights and interests of joint-stock investment fund / management company customers
The document introduces requirements for the scope of information provided to customers, specifies the rules of interaction with them and outlines the procedure for testing non-qualified investors before they buy units in closed-end unit investment funds (CEUIFs).
The basic standard was developed by NAUFOR, the self-regulatory organisation, and approved by the Bank of Russia.
The standard requires management companies (joint-stock investment funds) to disclose information about their membership in a self-regulatory organisation and the methods of sending appeals and pre-trial dispute settlement, making such information available in their offices, on their websites, in customers' personal accounts and in mobile applications. If requested by the customer, information should be provided about the amount of fees and possible extra expenses.
The presentation of information must be clear and unambiguous.
When providing services in a bank office or through a bank website or a mobile application, the management company (joint-stock investment fund) must notify customers that their funds in trust management are not deposits and are uninsured.
Non-qualified investor test processes are similar to those of broker tests conducted before purchases of CEUIF units.
In particular, in the case of a negative test, the investor still has the opportunity to exercise the right to the last word. Such investors are allowed to buy a CEUIF unit worth 100 thousand rubles at most (or more if the unit amount exceeds 100 thousand rubles in accordance with a Bank of Russia regulation), provided that they sign a statement of acceptance of risks and their consequences.
When an investor is recognised as qualified, the management company is required to give notice that such status makes it possible for them to buy units that are intended, due to increased risks, for qualified investors. Moving forward, the management company is obliged to notify qualified investors at least once a year of the right to submit an application to renounce this status.
The provisions of the standard on testing of and providing information to individuals recognised as qualified investors by a management company take effect from 1 October 2021, and the other provisions from 1 April 2022.