COLLECTIVE INVESTMENT SCHEMES ACT (CHAPTER 24:19)

CHAPTER 24:19

COLLECTIVE INVESTMENT SCHEMES ACT

Acts 25.1997, 22/2001 (s.40, 14/2002 (s. 46), 16/2004 (s. 30), 17/2004 (s. 120); S.I. 262/2007.

ARRANGEMENT OF SECTIONS

PART I

PRELIMINARY Section

1. Short title and date of commencement.
3. Meaning of “collective investment scheme”. PART II

ADMINISTRATION 4.    Registrar and other officers.

PART III

REGISTRATION OFCOLLECTIVE INVESTMENTSCHEMES

5. Prohibition against promotion or operation of unregistered collective investment schemes.
6. Categories in which collective investment schemes may be registered.
7. Registration of collective investment schemes.
8. Cancellation of registration.
9. Registration and cancellation thereof to be notified in Gazette.

PART IV

INTERNAL SCHEMES

10. Application of Part IV.
11. Trust deed.
12. Manager and trustee.
13. Licensing of manager and trustee.
14. Cancellation of licence of manager or trustee.
15. Suspension of licence of manager or trustee.
16. Issue, cancellation or suspension of licence to be notified in Gazette.
17. Replacement of manager or trustee.
18. Auditors of internal schemes.

PART V

EXTERNAL SCHEMES

19. Application of Part V.
20. Additional requirements for registration of external schemes.
21. Manager of external scheme to maintain local office.
22. Suspension of registration of external scheme.

PART VI

PROFESSIONAL SCHEMES

23. Application of Part VI.
24. Additional requirements for registration of professional schemes.
25. Auditors of professional schemes.
26. Suspension of registration of professional scheme.
27. Application of sections 11 and 12 to professional schemes.

PART VII

INSPECTIONSANDINVESTIGATIONS

28. Appointment of inspectors.
29. Registrar may demand information.
30. Investigation into affairs of licensed person or registered scheme.
31. Procedure on completion of investigation.
32. Expenses of investigation.

PART VIII

GENERAL

33. Restrictions on promotion of registered schemes.
34. Unsolicited calls.
35. Duty of disclosure towards participants in registered schemes.
36. Right of action by participants against manager of registered scheme.
37. Secrecy to be observed by Registrar and other officers.
38. Annual reports of Registrar.
41. False statements, etc.
43. Transitional provisions: existing schemes.

AN ACT to regulate and control the promotion and operation of collective investment schemes in Zimbabwe; to provide for the appointment and functions of a Registrar of Collective Investment Schemes and other officers; and to provide for matters connected with or incidental to the foregoing.

[Date of commencement: 1st August 1998]

PART I

PRELIMINARY

                   1    Short title and date of commencement

This Act may be cited as the Collective Investment Schemes Act [Chapter 24:19].

[Short title amended by s.i. 262 of 2006]

                   2    Interpretation

In this Act—

“advertisement”, in relation to a collective investment scheme, means any form of advertising in any media whatever but, except in relation to a professional scheme, does not include editorial or journalistic advice or comment on matters of public interest where the intention of the comment is neither to promote the

collective investment scheme nor to procure persons to become participants in it;

“collective investment scheme” has the meaning given to it in section three;

“external scheme” means a collective investment scheme described in section nineteen;

“fixed date”, in relation to any provision of this Act, means the date fixed in terms of subsection (2) of section one as the date of commencement of that provision;

“group of companies” means companies or other bodies corporate that are related to each other as holding company and subsidiary, or as subsidiaries of the same holding company, for the purposes of section 143 of the Companies Act [Chapter 24:03];

“holder”, in relation to a licence, means the person to whom the licence has been issued;

“inspector” means a person appointed as an inspector in terms of subsection (1) of section twenty-eight;

“internal scheme" means a collective investment scheme described in section ten;

“licence” means a licence issued in terms of section thirteen to the manager or trustee of an internal scheme, and “licensed” shall be construed accordingly;

“manager”, in relation to—

• any collective investment scheme, means the person who is responsible to participants for the management and control of the scheme and for the issue and redemption of units in the scheme;
• an external scheme, includes the promoter of the scheme;

“Minister” means the Minister of Finance and Economic Development or any other Minister to whom the President may, from time to time, assign the administration of this Act;

[Definition inserted by section 4 of Act 22 of 2001]

“participant” means a person who invests in or otherwise takes part in a collective investment scheme;

“professional scheme" mean a collective investment scheme described in section twenty-three;

“promoter”, in relation to a collective investment scheme, means a person who promotes the establishment of the scheme and additionally, or alternatively, promotes the sale of units, shares or other interests in the scheme;

“registered” means registered in terms of this Act;

“registered office”, in relation to the holder of a licence, means the holder’s registered office for the purpose of section 112 of the Companies Act [Chapter 24:03];

“Registrar" means the Registrar of Collective Investment Schemes referred to in section four;

“trust deed”, in relation to a unit trust scheme, means the written agreement between the manager and trustee which constitutes the scheme and under whose terms the property of the scheme is held;

“trustee”, in relation to a unit trust scheme, means the person who holds the property of the scheme in trust for the participants;

“unit”, in relation to a unit trust scheme, means the interest or share, by whatever name called, which a participant has in the scheme;

“unit trust scheme” means a collective investment scheme under which the property of the scheme is held in trust for the participants.

                   3    Meaning of “collective investment scheme”

(1) Subject to subsection (2), a collective scheme is an arrangement with respect to property of any description, the purpose or effect of which is to enable participants to participate in or receive profits or income arising from the acquisition, holding, management or disposal of the property, where—

(a) the participants do not have day-to-day control over the management of the property, whether or not they have the right to be consulted or to give directions in regard to its management; and (b) the arrangement has either or both the following characteristics—

• the participants’ contributions and the profits or income out of which payments are to be made are pooled;
• the property is managed as a whole.

(2) The following arrangements, contracts and dispositions are not collective investment schemes for the purposes of this Act—

• an arrangement managed by a person otherwise than by way of business and with no view to profit;
• an arrangement under which each of the participants carries on a business other than the management of investments for third parties and enters into the arrangement for commercial purposes related to that business;
• an arrangement under which all the participants as well as the person managing or controlling the arrangement are companies in the same group of companies;
• a franchise arrangement under which a person exploits a right to use a trade name or design or other form of intellectual property or the goodwill attached to it;
• an arrangement whose dominant purpose is to enable participants to share in the use or enjoyment of a particular property or to make its use available to other persons by time-share or otherwise;
• an arrangement whose purpose is to provide clearing services for a stock exchange, commercial bank or other financial institution;