NOTICE…..OF 2002
 
Under section 114(3) of the Collective Investment Schemes Control Act, 2002 (Act No. 2002), I, Jeffrey van Rooyen, Registrar of Collective Investment Schemes, hereby prescribe in the Schedule the circumstances under, and the conditions on which, the repurchase of participatory interests in a portfolio of a collective investment scheme in securities may be suspended.
 
SCHEDULE
 
Definition
 
1. In this Schedule "the Act" means the Collective Investment Schemes Control Act, 2002 (Act No. … of 2002), and any word or expression to which a meaning has been assigned in the Act, bears the meaning so assigned to it.
 
Circumstances under which repurchase of participatory interests may be suspended
The manager may, subject to the deed and condition 3 and with the consent of the trustee or custodian, suspend the repurchase of participatory interests if offers for repurchase of participatory interests are received, the aggregate amount of which is more than five percent of the market value of a portfolio as at the last valuation point: Provided that this condition does not preclude a manager from entering into an agreement with an investor determining a more restrictive basis on which repurchase offers will be honoured.
Conditions in respect of suspension
3. (1)(a) The repurchase of participatory interests, irrespective of their
aggregate amount or value, may not be suspended if 10
business days’ valid notice of the offer for repurchase has been
given to the manager.
The repurchase of participatory interests offered for repurchase by an investor, the aggregate amount or value of which does not exceed R50 000 on the day of such offer, shall be excluded from any suspension.
Any offer of participatory interests for repurchase, the aggregate amount or value of which exceeds R100 000, may be repaid by the manager over a period of 14 days in the manner agreed upon between the manager and investor.
(2) For the purpose of calculating the five percent referred to in condition 2, the aggregate amount or value of all offers for repurchase received on a specific day, shall be reduced by the aggregate amount of all sales of participatory interests on that day.
4. (1) If a manager decides to suspend the repurchase of participatory
interests under the circumstances contemplated in condition 2, it
must forthwith and with the consent of the trustee or custodian,
segregate a proportion of the assets from the rest of the assets in
the portfolio, on a basis equivalent to the value of all requests for
repurchase.
(2) The manager must –
(a) forthwith notify the investor(s) concerned that repurchasing has been suspended in accordance with the deed: Provided that in such case the investor must be given the option to withdraw his request to repurchase on the same day;
forthwith notify the investor(s) concerned that it shall endeavor to honour the repurchase request
within 20 business days from the date of suspension; and
calculate, and communicate to the investor(s), a single price per unit based on the segregated assets on a daily basis.
If the manager fails to meet the request to repurchase participatory interests within 20 business days, he must tender assets to that investor for payment: Provided that the investor may elect to extend the 20 business days to enable the manager to liquidate the relevant assets.
(4) The manager must forthwith notify the registrar –
that the repurchasing has been suspended in accordance with the deed; and
of the reasons for the suspension and how it will be dealt with.
 
(5) Where the manager has tendered assets in terms of condition 3(3)-
the manager must forthwith notify the trustee or custodian that the repurchase of participatory interests will be effected by the transfer of assets; and
the trustee or custodian must, on receipt of such evidence of title as it may require –
cancel the relevant participatory interests; and
(ii) transfer to the investor(s) its proportionate share of the assets of the portfolio.
(6) For the purposes of this condition –
(a) "proportionate share" means –
such part of the segregated assets in the portfolio as is proportionate to or as nearly as is practicably proportionate to the investor’s share; or
such selection from the assets of the portfolio as the trustee or custodian may, after consultation with the manager, decide is reasonable, having regard to the need to be fair both to the investor(s) concerned and the continuing investors;
(b) "valid notice" means notice in writing or such other method that has been agreed upon between the manager and the investor.