Proposals relating to various amendments to the Investment Funds Act, 2003 have been tabled in Parliament. Some of these amendments more broadly define Bahamas-based and non-Bahamas-based investment funds so as to remove restrictions adversely affecting Bahamian investment managers/advisors, and to bring the legislation in line with industry standards.

Other amendments extend the definition of a professional fund to avoid certain restrictions on the category of persons to whom a professional fund may be offered, and remove the minimum regulatory capital requirement for a broker dealer or investment securities advisor to invest in a professional fund.

Specific amendments:

Removal of the investment advisor/manager nexus to Bahamas-Based Funds: To ensure that a fund established in another jurisdiction would not inadvertently require licensing under the Investment Funds Act due to the nexus created when this foreign fund secures the services of a regulated Bahamian investment manager. Non-Bahamas-Based Funds would be required to appoint a registered representative in The Bahamas, with that registered representative being required to register with the Commission.

Expanding the Definition of Recognised Foreign Funds: To allow funds to become RFFs provided they are incorporated or established in a prescribed jurisdiction. Effectively, the requirement of a fund to be licensed or registered in a prescribed jurisdiction would be repealed.

Amending the Definition of Professional Funds: To remove the requirement for bank, trust, insurance or investment fund companies to be licensed in a prescribed jurisdiction, provided they are duly licensed (or registered in the case of investment funds) in another jurisdiction; (b) to allow eligible investors to include any registered firm under the Securities Industry Act or licensed in another jurisdiction; (c) to remove the minimum regulatory capital requirement for a broker-dealer of securities investment advisor to qualify to invest in a Bahamian professional fund; and (d) to include entities with net assets in excess of $5 million.

Amending the Annual Audit Filing Deadlines: To change the filing period of annual audited financial statements of investment funds to six months.

The Amendment Bill also empowers the Securities Commission of The Bahamas to publish guidelines made pursuant to the provisions of the Act or any regulation or rule made under the Act.