Article 422-21-1 into force since
- Version into force since
In accordance with the final paragraph of Article L. 214-24-33 and the final paragraph of Article L. 214-24-41 of the Monetary and Financial Code, a retail investment fund (FIVG) may temporarily gate the redemption of units or shares in the case it is necessary owing to exceptional circumstances and in order to protect the interests of units or shares holders or those of the public. Such conditions may be met in particular where irrespective of the normal carrying out of the management strategy, the level of redemption orders is such that, given the liquidity conditions of the assets of the SICAV, of the fund, or of one of its sub-funds, these orders cannot be executed on terms that protect the interests of holders and ensure their equitable treatment, or where redemption orders are made under circumstances that may undermine market integrity.
In these cases, redemptions may be gated in the same proportion for all concerned holders, who must be specifically informed of the fact. The part of orders that is unexecuted and that is resubmitted does not have any priority, on the next centralisation dates, over new redemption orders submitted on those dates.
The management company shall notify the AMF of its decision to apply a redemption gate. The management company shall also notify the public, by any means under the conditions set in the prospectus and, at a minimum, on the asset management company's website.
The rules of the common fund (FCP) or the articles of association of the SICAV shall precisely define the conditions under which a redemption gate may be applied, and in particular:
Set the threshold above which the management company may decide to apply a redemption gate to redemption orders received in respect of a single centralisation date;
This threshold shall be justified based on the frequency of net asset value calculation, on the management strategy and on the liquidity of the assets in the UCITS portfolio; the threshold is equal to the ratio between:
the difference registered on the same centralisation date between the number of redemption requests for units or shares of the UCITS and the number of subscription requests for units or sharesof the UCITS; and
the net assets of the UCITS or the total number of units or shares of the UCITS, or of the sub-fund in question.
This threshold is determined on the basis of the most recent published net asset value or of the most recent indicative net asset value calculated by the management company, or of the number of units or shares outstanding on the valuation date;
State the procedures according to which the UCITS may either decide to cancel the unexecuted part of redemption orders or to carry them forward until the next centralisation date. However, in the cases where the UCITS calculates its net asset value more than once a week, the unexecuted part of redemption orders is automatically carried forward to the next centralisation date;
Specify whether, and under what terms, the holder may oppose to the carrying forward of the unexecuted part of a redemption order;
Limit the gating of redemption requests to a maximum number of net asset values calculations for a given period; this maximum number must be explained with regard to the frequency of net asset value calculation, the management strategy and the liquidity of the assets in the UCITS portfolio.
Head of publications: The Executive Director of AMF Communication Directorate. Contact: Communication Directorate – Autorité des marches financiers 17 place de la Bourse – 75082 Paris cedex 02