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_____________________________________________________
FCP OP MEDICAL
Investment fund with an umbrella structure
organised under the laws of the Grand Duchy of Luxembourg
Prospectus/Management Regulations
Issue September 2017
________________________________________________________
Sub-fund:
FCP OP MEDICAL BioHealth-Trends
This is a free translation of the original Prospectus.
In case of divergences only the original German version is binding.
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CONTENTS
Page
FCP OP MEDICAL (the “Fund”)
Contents 3
Prospectus (Special Section) – Sub-fund: FCP OP MEDICAL – BioHealth-Trends 4
Prospectus (General Section) 9
Management Regulations (General Section) 31
Management Regulations (Special Section) 49
The Oppenheim Asset Management Services S.à r.l. Funds 54
Your Partners 55
Additional information for investors in the Federal Republic of Germany 57
Additional information for investors in Austria 58
The Prospectus and Management Regulations are organised into a General Section and a
Special Section. In particular, the General Section contains information regarding the legal
foundation and the general investment guidelines, which are equally applicable for a
number of other investment funds managed by Oppenheim Asset Management Services
S.à r.l. The Special Section particularly consists of specific details pertaining to the
respective Fund and the concrete investment policy of the Fund.
This Prospectus is only valid in conjunction with the most recent Annual Report, whose year
end must not be more than 16 months ago. If the year end of the Annual Report is more than
eight months ago subscribers must also be provided with a Semi-Annual Report.
Any information other than provided in this Prospectus, the Management Regulations, the
Key Investor Information, the Annual and Semi-annual Reports and in information available
to the public, may not be distributed. Any purchase of Units based on information or
declarations not contained in the documents mentioned above shall be at the purchaser’s own
risk.
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Prospectus (Special Section) ______________________________________________________________________
Sub-fund: FCP OP MEDICAL – BioHealth-Trends
Investment objective
The objective of the investment policy is to generate attractive capital growth in euros for
each sub-fund.
General investment policy of the Fund
In order to achieve this investment objective, the Fund Assets are invested worldwide in
line with the principle of risk diversification in shares, share-type securities and
participation certificates, which are listed or traded on a regulated market, which is
recognised, open to the public and operates in an orderly manner, as well as in other
permitted assets.
At least 60% of the value of the UCITS fund is invested in equities, which are admitted to
official trading on a stock exchange or admitted to or included in another organised market
that is not an investment fund.
Fixed and variable rate securities, convertible and option bonds and zero bonds
denominated in the currencies of OECD member states may also be purchased, if this is
considered to be in the interests of the Unitholders. Liquid assets may also be held. In
addition to sight and term deposits, these also include regularly traded money market
instruments with a (residual) term of up to 12 months. Notwithstanding Article 4 No. 4 h)
and i) of the Management Regulations, purchase of investment units in UCITS and/or other
UCIs in terms of Article 4 No. 2 e) of the Management Regulations is limited to a
maximum total of 10% of the Fund’s net assets.
Up to 100% of the Fund’s net assets per sub-fund, but always at least two thirds thereof, is
invested in securities of companies operating in the biotechnology, medical technology,
healthcare and pharmaceutical sectors.
For the purpose of hedging and the efficient management of fund assets, the Fund may also
utilise derivatives and other techniques and instruments, in accordance with the
requirements of the guidelines governing investment policy under the Management
Regulations provisions set out below.
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Characteristics of the sub-funds
Currently only the following sub-fund exists:
FCP OP MEDICAL BioHealth-Trends
This sub-fund has the following characteristics:
Unit classes
The following unit classes are currently available:
Unit Class EUR H
Unit Class EUR
Unit Class I
Unit Class I H
Unit Class I X
General
The sub-fund currently has five unit classes, “Unit Class EUR H”, “Unit Class EUR”,
“Unit Class I”, “Unit Class I H” and “Unit Class I X”. The reference currency of the classes
is the EURO. The objective for “Unit Class EUR H” and “Unit Class I H” is to hedge the
foreign currency risk of investments which are not denominated in euros as far as possible
against the euro. Under certain circumstances the costs of such hedging may significantly
increase the total costs of “Unit Class EUR H” and “Unit Class I H”. As a rule, the costs
of or income from hedging exclusively burden or favour “Unit Class EUR H” and “Unit
Class I H”. Currency hedging transactions entered into for “Unit Class EUR H” or “Unit
Class I H could, however, under some circumstances also have an effect on the Net Asset
Value of other unit classes
Shares of Unit Classes EUR and EUR H may be subscribed to by all investors. Shares of
Unit Class I, Unit Class I H and Unit Class I X are intended solely for institutional
investors.
Specific investment strategy
This sub-fund is a strategic investor, which selects its investments primarily from a long-
term perspective.
Advances made in recent years in the development of innovative drugs and therapeutic
procedures, decoding of the genome, use of new information technologies and the internet
to simplify management and save costs in healthcare, as well as consolidation in the
pharmaceutical industry following the advent of new niche players, will create many new
investment opportunities in the years ahead, and the sub-fund intends to participate in these
opportunities. Consequently, the portfolio focuses on companies whose current situation
indicates above-average growth prospects, such as securities in the biotech, genomics, e-
health, medical technology, emerging pharma, pharma, health care services and drug
delivery sectors, most of them domiciled in the USA.
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Risk profile
Owing to its specific investment policy, this sub-fund has an increased opportunity-risk
profile. Shares, share certificates and other equity securities in innovative companies in the
biotech and health care sector in the wider sense may experience marked price fluctuations.
Thereby the Fund’s investment results may fluctuate more strongly than might be
anticipated for a balanced distribution of assets in the market as a whole. In addition,
sectoral focusing may result in share value growth which differs from the general market
trend.
Investor profile
Investments in Units of the sub-fund FCP OP MEDICAL BioHealth-Trends should only
be made by investors who are capable of assessing the risks and trends in the health care
market and who wish to invest in such securities as an addition to their portfolio.
What else you should know about the Sub-fund FP OP MEDICAL BioHealth-
Trends:
Unit Class EUR:
ISIN Code: LU0119891520
Security Identification No.: 941135
Minimum investment: None
Date of establishment: 30 October 2000
Initial issue date of Units: 30 October 2000
Unit Class EUR H:
ISIN Code: LU0228344361
Security Identification No.: A0F69B
Minimum investment: None
Date of establishment: 30 October 2000
Initial issue date of Units: 30 October 2000
Unit Class EUR I:
ISIN Code: LU0294851513
Security Identification No.: A0MNRQ
Minimum investment: EUR 100,000
Date of establishment: 30 October 2000
Initial issue date of Units: 30 October 2000
Unit Class EUR I H:
ISIN Code: LU0295354772
Security Identification No.: A0MQG5
Minimum investment: EUR 100,000
Date of establishment: 30 October 2000
Initial issue date of Units: 30 October 2000
Unit Class EUR I X:
ISIN Code: LU1152054125
Security Identification No.: A12GCR
Minimum investment: EUR 10,000,000
Date of establishment: 18 December 2014
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Minimum holding period: 6 months
Redemption fee: 0.30% for holding periods of less than 6 months
Subscription and initial issue date: 18 December 2014
For all unit classes:
Sub-fund currency: EUR
Issue commission: up to 5% of the Net Asset Value per Unit in favour of the
Distributor
Management fee: up to 1.9% p.a. of the Fund’s net assets for management,
asset management and distribution of the Fund by the
Management Company.
Depositary fee: Up to 0.10% p.a. of the Fund’s net assets (plus VAT)
Performance bonus: 15% (Unit Classes EUR and EUR H) or 10% (Unit Class
I, Unit Class I H and I X) of the excess appreciation with
regard to the Net Asset Value per Unit and half-year
(Excess appreciation is the capital growth per half-year
in excess of 2.5%, see Article 20 No. 5 of the Special
Section of the Management Regulations)
The performance bonus is only paid if the Net Asset
Value per Unit reaches, at half-year end, a new high
compared to the high at a previous half-year end (the
“High Water Mark”) and only on the new excess
appreciation over the said high of the Net Asset Value per
Unit at the end of a previous half-year.
Share certificates: There is no entitlement to the delivery of physical
certificates.
Financial year: 1 January to 31 December
Distribution policy: The sub-fund always distributes income earned.
Performance: KII as well as the annual and semi-annual reports contain
information on performance.
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The Fund FCP OP Medical is a mutual investment fund in accordance with Part I of the Law of 2010
and has been established as a legally dependent fund (“fonds commun de placement”) for an
indefinite period and is registered in the Trade and Companies Register under No. K1322.
When selecting securities to purchase or sell, the Management Company is permitted to
use the services of a scientific adviser. The latter provides information on investment-
related trends in the science environment and also advice, particularly on scientific issues,
relating to the area of activity and scientific environment of companies which are being
considered for the Fund’s portfolio.
The Fund is managed by Oppenheim Asset Management Services S.à r.l in compliance
with Luxembourg law. In accordance with current Luxembourg regulations, the
Management Company may delegate the fund management or central administration
duties to other Oppenheim Group companies under its own responsibility and at its own
expense.
Notification of the filing of the Fund’s Management Regulations (Special Section) with the
Luxembourg Trade and Company Register was published on 15 September 2017.
The Management Company also publishes KII, which contains the essential information on
the key features of the Fund. The KII is to be provided to investors and is intended to allow
them to understand the type and risks of the investment products and to make an informed
investment decision on this basis. The KII contains information on the following key
elements:
The identity of the Fund;
A description of the investment objectives and investment strategy;
A presentation of past performance or, where applicable, performance scenarios;
Costs and fees, and
The risk/return profile of the investment, including appropriate indications of the risks
and connected with investment in the relevant UCIT and a corresponding warning.
The Prospectus and the KII are updated from time to time. For this reason, potential investors
are advised to request the most recent edition of the Prospectus and the KII from the
Management Company.
Risk management
The Management Company makes use of a risk management procedure for the Fund that
is in accordance with the Law of 2010 and other applicable regulations, in particular CSSF
Circulars 11/512 and 13/559. The Management Company uses the risk management
procedure to record and measure the market risk, liquidity risk, counterparty risk and all
other risks, including operational risks that are relevant to the Fund.
The Management Company uses the relative VaR method to calculate total risk.
The VaR, which is a method of measuring the risk of a specific portfolio’s assets, is widely
used in the financial sector. The VaR represents the level of loss that will not be exceeded
with a given level of probability for such a portfolio, a given probability and a fixed time
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interval. The current market prices of the assets in the portfolio are used to calculate VaR
and it is assumed that there will be no trading activity in the portfolio.
For the purpose of risk mitigation, the total risk from all assets of the Fund as determined
by the VaR may not exceed twice the VaR of a benchmark portfolio with the same market
value. The MSCI World Healthcare index serves as the benchmark portfolio. Additional
information on the benchmark portfolio is available at no charge from the Management
Company.
The Management Company expects leverage of up 200% of the respective Net Fund
Assets. This percentage does not represent an investment limit and may vary from time to
time. The leverage may be higher in certain circumstances, such as when market volatility
is low. The method used to calculate leverage is the sum of the nominal amounts.
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Prospectus (General section) ______________________________________________________________________
Definitions:
“Unit”: An interest in the Fund or a sub-fund.
“Unitholder”: The holder of one or more unit(s).
“Valuation Day”: Each bank working day and exchange trading day in
Luxembourg, Frankfurt/Main and Düsseldorf. (with
the exception of 24 December and 31 December)
“CSSF”: Commission de Surveillance du Secteur Financier or
its successor, which is charged with the supervision of
undertakings for collective investment in the Grand
Duchy of Luxembourg.
“Depositary ”: Sal. Oppenheim jr. & Cie. Luxembourg S.A. acts as
Depositary .
“Derivative”: A derivative financial instrument, i.e. in particular
options and futures as well as swap transactions,
including equivalent cash-settled instruments, which is
traded on a regulated market.
“Third country”: Any state that is not a member of the European Union
or the European Economic Area.
“Feeder fund”: A UCITS that has been approved and that invests at
least 85% of its assets in shares of other UCITS or sub-
funds of UCITS (i.e. the master fund).
“Fund Assets”: Securities and other permitted assets of the Fund or
sub-fund.
“Fund currency”: The currency in which the respective sub-fund is
maintained, as specified in the Special Section of the
Management Regulations.
“Money market instruments”: Instruments normally traded on the money market,
which are liquid and have a value that can be
accurately determined at any time.
“Regulated Market”: Any market that is regulated in accordance with
Directive 2004/39/EC of the European Parliament and
the Council of 21 April 2004 on markets for financial
instruments (including subsequent amendments and
supplements).
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“Law of 1915”: The Luxembourg Law of 10 August 1915, on Trading
Companies, as amended from time to time or replaced.
“Law of 2010”: The Luxembourg Law of 17 December 2010, on
Undertakings for Collective Investment, as amended
from time to time or replaced.
“KII”: “Key Investor Information” – a document that contains
information on the Fund that is of significance for the
investor.
“Master fund”: A UCITS or a sub-fund of a UCITS in which one or
more feeder funds invest at least 85% of their assets.
“Mémorial”: The Mémorial C, Recueil des Sociétés et Associations,
the former official Gazette of the Grand Duchy of
Luxembourg.
“Net Fund Assets”: The assets of the Fund or sub-fund minus the liabilities
attributable to the Fund or sub-fund.
“Net Asset Value”: The Net Asset Value is the sum of the Fund or
respective sub-fund units in circulation.
“Net Asset Value per unit”: The value of a unit, expressed in the Fund currency
and established in accordance with the provisions of
Article 7 of the Management Regulations.
“OECD”: The Organisation for Economic Cooperation and
Development, which brings together countries around
the world that are committed to democracy and a
market economy.
“UCI”: An undertaking for collective investment.
“UCITS” An undertaking for collective investment in
transferable securities that is subject to the UCITS
directive.
“UCITS Directive”: The Council Directive 2009/65/EC of 13 July 2009
relating to certain undertakings for collective
investment in transferable securities (including
subsequent amendments and supplements).
“OTC Derivative”: A derivative financial instrument that is not traded on
an exchange or a regulated market.
“RESA”: The Recueil Électronique des Sociétés et Associations,
the official Gazette of the Grand Duchy of
Luxembourg
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“Section”: A section in the Prospectus or the Management
Regulations.
“Sub-fund”: A separate portfolio of assets that pursues a special
investment policy and which is subject to separate
liabilities, income and expenses. The assets can only be
accessed in order to satisfy the rights of the unitholders
in relation to the sub-fund and the rights of the
creditors whose claims arise in connection with the
placement, management and liquidation of the sub-
fund.
“VaR”: Value at risk, a risk management process.
“Prospectus”: The Prospectus for the Fund.
“Management Company”: Oppenheim Asset Management Services S.à r.l., acting
as Management Company.
“Management Regulations”: The Management Regulations of the Fund.
“Depositary ”: Sal. Oppenheim jr. & Cie. Luxembourg
S.A., is the Depositary .
“Securities”: As specified in Article 1 (34) of the Law of 2010, i.e.:
- company shares and other securities equivalent
to shares in companies,
- bonds and other forms of certificated debt
instruments,
- all other negotiable securities which carry the
right to acquire any such transferable securities
by subscription or exchange, insofar as these
are not techniques and instruments within the
meaning of no. 7 of this Article.
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Management Company
The Management Company Oppenheim Asset Management Services S.à r.l., a société à
responsabilité limitée (limited liability company) under Luxembourg law, was originally
established as Oppenheim Investment Management International S.A., a société anonyme
(public limited company) under Luxembourg law, on 27 September 1988, changing its
legal form on 31 August 2002 and its name on 1 October 2007. Its Articles of Association
were last amended on 30 August 2013 and filed with the Luxembourg Trade and Company
Register on 6 September 2013. A notice of this filing was published in the Mémorial on
19 September 2013.
The Management Company is authorised under Chapter 15 of the Law of 17 December
2010 and fulfils the equity capital requirements of this law.
The registered office of the Management Company is in the City of Luxembourg.
The Management Company will carry out the central administration duties for the Fund in
Luxembourg. It is also the responsibility of the Management Company to invest the funds
received in accordance with the investment policy set out in the Management Regulations.
The Fund’s Management Regulations are an integral part of this Prospectus.
The Management Company is included in the remuneration policy of the Deutsche Bank
Group. All remuneration matters as well as compliance with regulatory requirements are
monitored by the relevant committees of the Deutsche Bank Group. The Deutsche Bank
Group pursues a total remuneration policy which includes fixed and variable remuneration
components, as well as deferred elements of remuneration which relate to individual future
performance and the continuing development of the Deutsche Bank Group. To determine
the level of the deferred remuneration element and of the instruments linked to long-term
further development (such as equities or fund units), the Deutsche Bank Group has defined
a remuneration system which avoids significant dependence on the variable remuneration
component.
The remuneration system is specified in the remuneration policy, which covers the
following points among others:
a. The remuneration policy is consistent with sound and effective risk management
and is conducive to it. The remuneration policy does not encourage the assumption
of excessive risks.
b. The remuneration policy is in line with business strategy, objectives, values and
interests of the Deutsche Bank Group (including the Management Company, the
UCITS under its management and the investors in this UCITS) and includes
measures for avoiding conflicts of interest.
c. The performance evaluation takes place within a multi-year framework.
d. The fixed and variable components of total remuneration are proportionate, with
the fixed component of the total remuneration being high enough to provide
complete flexibility in relation to the variable remuneration components, including
the option to dispense with payment of a variable component.
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Further details relating to the Management Company’s current remuneration policy are
available on the internet at https://www.db.com/cr/de/konkret-verguetungsstrukturen.htm
and the linked remuneration report of Deutsche Bank AG. This includes a description of
the methods for calculating remuneration and benefits for certain groups of employees, as
well as details of those responsible for allocating such amounts including members of the
Remuneration Committee. The Company shall provide this information in paper form, free
of charge, upon request.
Depositary
The Depositary is Sal. Oppenheim jr. & Cie. Luxembourg S.A. The Depositary is a bank
under Luxembourg law.
It is responsible for the custody of Fund assets. It also undertakes special monitoring duties.
Custody
The Depositary shall fulfil its Depositary duties as follows:
The following shall apply to financial instruments that can be included in custody:
The Depositary shall hold all financial instruments that are eligible to be posted to
an account for financial instruments with the Depositary and all financial
instruments that can be physically transferred to the Depositary .
The Depositary shall ensure that financial instruments that are eligible to be posted
to an account for financial instruments with the Depositary are registered in the
Depositary 's books in segregated accounts that have been opened in the name of
the Fund or the Management Company acting on behalf of the Fund, so that the
financial instruments can be identified clearly at any time as instruments belonging
to the Fund under the prevailing law.
The following shall apply to other assets:
The Depositary shall check whether the Fund or the Management Company acting
on behalf of the Fund is the owner of the relevant assets and shall maintain records
in this respect.
Monitoring obligations
Within the framework of its monitoring activities, the Depositary shall act as follows:
The Depositary :
shall ensure that the sale, issue, redemption, payout and cancellation of units of the
Fund ensue in compliance with Luxembourg law and the Management
Regulations;
shall ensure that the value of the units of the Fund is calculated in compliance with
Luxembourg law and the Management Regulations;
shall comply with instructions issued by the Management Company unless they
contravene Luxembourg law, the Sales Prospectus or the Management
Regulations;
shall ensure that the Fund’s income is used in accordance with Luxembourg law
and the Management Regulations.
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Monitoring cash flow
The Depositary shall ensure that cash flows of the Fund are monitored properly and shall
ensure in particular that all payments made by or in the name of investors upon subscription
to units of the Fund are received and that all monies of the Fund are accordingly posted to
cash accounts that are managed in accordance with the legal regulations.
Particular conflicts of interest in relation to the Depositary
The Depositary has stated that it has suitable structures to prevent potential conflicts of
interest. The schedule of responsibilities and the organisational structure of the Depositary
comply with the legal and regulatory requirements and take particular account of the
requirement to avoid conflicts of interest.
The Depositary ’s conflict of interest policy provides for the use of various methods for
avoiding conflicts of interest which are presented in summary form below:
a. Controlling the flow of information: Provisions on areas of confidentiality
(“Chinese Walls”) and the procedure for addressing them (transfer of information
in the company in strict compliance with the “need-to-know” principle).
b. Separate monitoring of relevant persons.
c. No detrimental dependencies in the remuneration system.
If conflicts of interest or potential conflicts of interest cannot be avoided, they are
identified by the Depositary and the Fund is notified. General information on potential
conflicts of interest under UCITS/AIFMD is available online at
https://fundplatforms.deutscheam.com/Leistungsspektrum/Depotbank/Leistungsspektrum
.
The Depositary must transfer custody of assets in various countries to sub-Depositary s.
An up-to-date list of foreign sub-Depositary s to which the Depositary has transferred
custody of assets is available online at
https://fundplatforms.deutscheam.com/Leistungsspektrum/Depotbank/Leistungsspektrum
so that the Fund and, if applicable, the Management Company can ascertain whether
conflicts arise from this structure for the relevant fund.
The service provider appointed by the Fund or the Management Company and the sub-
Depositary s may have a direct or indirect relation to each other in terms of corporate law
and employees. The partial identity of the companies involved may, on account of a lack
of spatial, human or functional separation, lead to a situation where interests and objectives
of the persons or companies involved collide or run counter to each other. Consequently,
the Depositary has published a full list of its sub-Depositary s on the internet.
Such conflicts of interest arise in relation to the transfer of the Depositary function to
individual sub-Depositary s mainly from the following interrelationships:
Mutual investments:
The sub-Depositary holds investments in the Management Company or the Management
Company holds investments in the sub-Depositary . This may lead to a reciprocal influence
which could be incompatible with the objectives of the Depositary function.
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Financial consolidation:
The Management Company and the sub-Depositary have consolidated financial
statements and therefore common financial interests. This may mean that these financial
interests and objectives from the Depositary function are incompatible with each other.
Joint management/monitoring:
In this case, decisions are made or monitored by the same persons for the Management
Company and the sub-Depositary . This might incur the risk of the required objectivity of
the decision-makers or the people monitoring them being influenced in an individual case.
Joint activities:
A sub-Depositary could carry out the Depositary function as well as monitoring portfolio
management or trade execution for a fund. This might incur the risk of the required
objectivity in the relevant function being influenced in an individual case.
The list of possible sub-Depositary s available on the internet
(https://fundplatforms.deutscheam.com/Leistungsspektrum/Depotbank/Leistungsspektru
m) allows the Fund and the Management Company to carry out the necessary review.
Additional information
Upon request, the Management Company shall provide investors with up-to-date
information about the Depositary and its duties, the sub-Depositary s, as well as potential
conflicts of interest in connection with the activity of the Depositary or sub-Depositary s.
If the legal regulations of a third country stipulate that particular financial instruments must
be held by a local establishment and there are no local establishments that satisfy the
requirements for engagement in accordance with the Luxembourg Law of 2010 and other
applicable rules and regulations, the Depositary may transfer its functions to such a local
establishment only to the extent demanded by the law of the third country and only as long
as there are no local establishments that fulfil the requirements for engagement. At this
time, no responsibilities are being transferred. In the event of such a transfer, the Sales
Prospectus shall be updated accordingly.
Investment advisor
The Management Company will be supported in the management of the Fund’s assets by
Medical Strategy GmbH, with its registered office in Gräfelfing, Germany, acting as
investment advisor. Medical Strategy is a financial services institution within the meaning
of Section 1 para. 1a of the German Banking Act (KWG)
The Investment Advisor provides the Management Company with their investment
recommendations based on the law, Sales Prospectus and Management Regulations in
accordance with the law in Luxembourg, where investment decisions are made. Following
approval from the Management Company, investment decisions may also be made with
special power of attorney by a representative of the Investment Advisor. The Managing
Directors of the Investment Advisor are Dr med. Michael Fischer, Jürgen Harter, Mario
Linimeier and Harald Schwarz. The Advisory Board consists of Prof. Dr med. Peter
Hohenberger, Surgical University Hospital Mannheim, Department of Special Surgical
Oncology and Thoracic Surgery, Prof. Dr med. Thomas Zeller, chief physician at the
University Heart Centre in Bad Krozingen and Prof. Dr Manfred Weber, chief physician
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at the Medizinischen Klinik I [Medical Clinic I Cologne-Merheim], Kliniken der Stadt
Köln gGmbH.
Investment Policy
The sole purpose of the Fund is the investment of the assets of the Fund in securities and
other permitted assets within the meaning of the Law of 2010 in keeping with the principle
of risk diversification and to provide unitholders with the profits resulting from the
management of their assets. The Management Company may take any action and execute
any transactions that it deems useful in fulfilling and developing the Company’s purpose,
in the broadest sense, in compliance with the law of 2010.
The Management Company will invest the Fund Assets, after undertaking a thorough
analysis of all available information and carefully weighing up the risks and opportunities,
in securities, money-market instruments and other assets permitted by the Management
Regulations. The performance of the Units will, however, depend on price movements on
the capital, securities, money and foreign exchange markets. No guarantee can therefore
be given that the Fund’s investment objectives will be achieved.
In addition, the Management Company may, pursuant to Article 1 (2) (a) and (b) of the
UCITS Directive, implement master-feeder structures for one or more funds in order to
bundle their assets and achieve cost savings for UCITS within the EU.
The corresponding feeder funds may thus deviate from the standard diversification limits
in order to invest their assets in a master fund or sub-fund.
The feeder fund must invest at least 85% of its assets in the master fund and the remaining
15% of its assets must be invested in other permitted assets.
A feeder fund may terminate the function of the feeder fund or replace its master fund. In
such cases, unitholders are informed accordingly and the Prospectus, the Management
Regulations and the corresponding KII are adapted after receiving the approval of the
CSSF.
Derivative instruments and techniques and instruments for efficient portfolio
management
For investment and hedging purposes, the Management Company or the investment
manager may acquire derivative instruments (e.g. futures, options, swap contracts) for the
account of the Fund and use techniques and instruments relating to securities and money
market instruments for efficient portfolio management in accordance with CSSF Circular
13/559, within the limits set down by the investment restrictions and dependent on the
specific investment policy of the Fund.
Techniques and instruments for efficient portfolio management include options on
securities and financial futures as well as, among others, securities lending and securities
repurchasing transactions (opérations à réméré, opérations de prise/mise en pension),
repurchase agreements and reverse repurchase agreements.
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In no case may the use of techniques and instruments and derivatives for efficient portfolio
management result in the Fund’s deviation from the investment objectives and investment
restrictions presented in this Prospectus or result in the Fund being exposed to additional
risk that goes beyond the risk described in this Prospectus or, in particular, result in the
Fund’s ability to execute redemption requests being impaired.
Risks and costs
The ability to enter into the aforementioned transactions may be restricted by statutory
provisions or market conditions. Furthermore, no guarantee can be given that this
investment or hedging strategy will successfully achieve its objectives. Options, futures
and swap transactions as well as other permitted derivatives often incur transaction costs
and higher investment risks for the Fund Assets than would otherwise be incurred by the
Fund if it did not engage in these transactions. The specific risks are described in greater
detail under “Risk factors”.
The Fund bears all transaction costs and expenses relating to derivative transactions and
the use of techniques and instruments, including depositories and clearing house costs. It
should also be noted that the counterparty of a transaction may retain a minor portion of
the earnings achieved as fees. Earnings which result from the use of securities lending and
repurchase agreements shall generally be attributed to the Fund Assets, less the
aforementioned direct and indirect operational costs. The Management Company has the
right to charge the Fund a flat fee of up to 50% of the earnings from these transactions in
return for the initiation, preparation and execution of securities lending transactions
(including synthetic securities lending transactions) and repurchase transactions carried
out for the account of the Fund. The costs incurred in connection with the preparation and
execution of such transactions, including those payable to third parties (e.g. transaction
costs to be paid to the Depositary as well as costs for the use of specific information
systems to ensure best execution) are borne by the Management Company.
Total return swaps
A total return swap is a derivative whereby a counterparty transfers to another the total
yield of a reference liability, including income from interest and fees, gains and losses
from price fluctuations, as well as loan losses.
Total return swaps may be effected for the Fund for the purpose of efficient portfolio
management. At present, the Management Company does not intend to make use of this
option. Both positive and negative income from total return swaps are fully taken into
account in the Fund.
If, in implementing the investment strategy, the Fund makes use of total return swaps or
invests in other derivatives with the same or similar characteristics, information regarding
the underlying strategy or the counterparty, for example, will be found in the Special
Section of this Prospectus.
OTC derivatives
The Fund may enter into derivative transactions that are admitted to trading on an exchange
or are a part of another organised market, as well as OTC transactions. A method allowing
a precise and independent valuation of the value of the OTC derivatives shall be employed.
18
Counterparty selection
Concluding OTC derivative transactions, including total return swaps, securities lending
agreements and repurchase agreements, is permissible with banks or financial service
providers only on the basis of standardised master agreements. The counterparties must be
subject to continuous supervision by a public authority, be financially sound and have an
organisational structure and the resources necessary for the services to be provided by
them. In general, all counterparties have their headquarters in member states of the
Organisation for Economic Cooperation and Development (OECD), the G-20 or
Singapore. A further requirement is that either the counterparty itself or its parent company
has an investment grade rating from one of the leading rating agencies.
Securities lending and repurchase agreements
Depending on the particular investment policy of the Fund, the Fund may be permitted to
assign securities in its assets portfolio to a counterparty for a certain period of time in return
for compensation at market rates. In this case, the Fund will ensure that all securities
assigned within the scope of a securities lending transaction can be reassigned at any time,
and that all securities lending agreements can be terminated at any time.
a) Securities lending transactions
If the Fund is allowed to enter into securities lending transactions according to its particular
investment guidelines, the applicable limitations will be found in the latest version of CSSF
Circular 08/356.
These transactions can be entered into for one or several of the following purposes: (i) risk
reduction, (ii) cost reduction and (iii) achievement of an increase in capital or earnings at
a degree of risk that corresponds to the risk profile of the Fund and the provisions on risk
diversification applicable to the Fund. Securities lending transactions may be executed in
relation to the net asset value of the Fund provided (i) that the transaction volume is kept
at an appropriate value or the return of the loaned securities can be demanded in such a
way that the Fund can meet its redemption obligations at any time, and (ii) that these
transactions do not jeopardise the management of the Fund Assets in accordance with the
investment policy of the respective sub-fund. The risks of these transactions are controlled
within the scope of the Management Company’s risk management process.
The Fund may enter into securities lending transactions only in accordance with the
following requirements:
(i) The Fund may lend securities only by using a standardised system operated by a
recognised clearing house or a securities lending programme operated by a first-
rate financial institution, insofar as this financial institution specialises in these
types of transactions and is subject to supervisory provisions that are comparable,
in the opinion of the CSSF, to the provisions of European Community law.
(ii) The borrower must be subject to supervisory provisions that are comparable, in the
opinion of the CSSF, to the provisions of European Community law.
(iii)The counterparty risk arising from one or more securities lending transaction(s)
with a single counterparty (which, for clarification, can be reduced by using
collateral) may not exceed 10% of the Fund Assets if the counterparty is a bank
falling under Article 4 No. 4 a) of the Management Regulations (General Section),
or in all other cases, 5% of the Fund Assets.
19
The Management Company discloses the total value of the loaned securities in the Fund’s
annual and semi-annual reports.
Securities lending transactions may also be executed synthetically (“synthetic security
lending”). Synthetic security lending takes place when a security is sold to a counterparty
at the current market price. The sale takes place subject to the condition that the Fund
simultaneously receives a securitised option without leverage from the counterparty giving
the sub-fund the right, at a later point in time, to demand the provision of securities of the
same type, quality and amount as the securities that were sold. The price for the option
(“option price”) corresponds to the current market price of the sale of the securities less a)
the security lending fee, b) earnings (e.g. dividends, interest payments, corporate actions)
arising from the securities that can be returned upon exercising the option and c) the
exercise price associated with the option. During the term, the option will be exercised at
the exercise price. If, during the term of the option, the security underlying the synthetic
securities lending transaction is sold because of the implementation of the investment
strategy, this may also be done by selling the option at the prevailing market price less the
exercise price.
Securities lending transactions may also be entered into in relation to specific unit classes
by taking the respective particular characteristics and/or investor profiles into
consideration, whereby all claims to earnings and collateral within the scope of such
securities lending transactions apply at the level of the unit class affected.
b) Repurchase agreements
If permitted by the particular investment guidelines of the Fund, the Fund may (i) enter
into repurchase agreements consisting of the purchase and sale of securities and containing
the right or the obligation of the seller to repurchase the securities sold from the buyer at a
price and under conditions that have been contractually agreed by both parties, and (ii)
engage in reverse repurchase transactions that consist of futures transactions upon the
maturity of which the seller (counterparty) is obliged to buy back the securities sold, and
the Fund is obliged to return the securities received within the scope of the transaction
(jointly referred to as “repurchase agreements”).
These transactions may also be entered into for one or more of the following purposes:
(i) earning additional income and
(ii) short-term secured investment of funds.
Information about the proportion of assets under management expected for these
transactions can be requested from the Management Company.
In specific repurchase transactions or in a series of ongoing repurchase transactions, the
Fund may be either the buyer or the seller. However, participation in these transactions is
subject to the following conditions:
(i) The Fund may only buy or sell securities within the scope of a repurchase
transaction if the counterparty of this transaction is subject to supervisory
provisions that are, in the opinion of the CSSF, comparable to the provisions of
European Community law.
(ii) The counterparty risk arising from one or more repurchase transaction(s) with a
counterparty (which, for clarification, can be reduced by using collateral) may not
exceed 10% of the Fund Assets if the counterparty is a bank falling under Article
4 No. 2 f) of the Management Regulations (General Section), or in all other cases,
5% of the Fund Assets.
20
(iii) During the term of a repurchase agreement in which the Fund is the buyer, the
Fund may sell the securities forming the subject matter of the agreement only after
the counterparty has exercised its right to repurchase these securities, or the term
for the repurchase has elapsed, unless the Fund has other means of funding.
(iv) The securities purchased by the Fund within the scope of a repurchase agreement
must be consistent with the investment policy and the investment limitations of the
Fund and must be limited to:
Short-term bank certificates or money market instruments according to the
definition in Directive 2007/16/EC dated 19 March 2007.
These may be bonds from non-governmental issuers that have adequate
liquidity, or
Assets that are referred to above in the second, third and fourth sections of a)
Securities lending.
(v) The Management Company discloses the total amount of open repurchase
transactions as of the reporting dates of its annual and semi-annual reports.
Repurchase agreements may also be entered into in relation to specific unit classes by
taking their respective special characteristics and/or investor profiles into consideration,
whereby all claims to earnings and collateral within the scope of such repurchase
transactions apply at the level of the unit class affected.
Collateral management of derivatives and techniques and instruments
Assets received from contracting parties (also “counterparties”) within the scope of
derivative transactions (with the exception of currency futures transactions), securities
lending transactions, repurchase agreements and reverse repurchase agreements represent
collateral.
All collateral that reduces the counterparty risk must meet all the following criteria at all
times:
Liquidity. Any collateral received which is not in the form of cash must be highly liquid
and be traded on a regulated market or multilateral trading platform with transparent
pricing so that it can be sold quickly at a price that is as close as possible to a valuation
before the sale. Collateral received must also comply with the regulations of Article 56 of
the UCITS Directive.
Correlation. Collateral received by the Fund must be issued by an issuer who is
independent of the counterparty and who is not expected to be closely correlated with the
performance of the counterparty.
Diversification of collateral (concentration of assets). Collateral should be adequately
diversified across countries, markets and issuers. The requirement for adequate
diversification with regard to issuer concentration shall be deemed to be satisfied if the
Fund receives from the counterparty of the relevant portfolio management and the over-
the-counter financial derivatives transactions a collateral basket in which no more than
20% of the net assets of the UCITS are at risk with respect to a particular issuer. If the
Fund has different counterparties, the various collateral baskets must be aggregated in
order to apply the 20% risk limit with regard to a particular issuer. In derogation from the
aforementioned regulations, the Fund may accept as collateral different transferable
securities and money market instruments that are issued or guaranteed by an EU member
21
state, by one or more of its domestic authorities, by a non-member state or by a public
institution to which one or more EU member states belong. In this case, the Fund must
receive collateral from at least six different issuers whereby the collateral of an individual
issuer must not account for more than 30% of the net asset value of the Fund.
The Fund may only engage in transactions with counterparties which the Management
Company considers to be creditworthy. As a rule, eligible counterparties have a public
rating of at least A-. Counterparties may not change the composition and management of
a portfolio of the Fund or the underlying value of a derivative used by the Fund at their
discretion. No approval from the counterparty is required in connection with investment
decisions made by the Fund.
If a collateral security satisfies a series of criteria, such as the liquidity, valuation and
creditworthiness standards of the issuer, and if, even after receiving the collateral (by
considering correlation), the risk diversification provisions according to Article 4
Paragraph 4 of the Management Regulations (General Section) are met, it may be offset
against the gross exposure of the counterparty. If a collateral security is offset, its value is
reduced by a percentage (a “discount”) intended to capture, among other things, short-term
fluctuations in the value of the exposure and the collateral. The amount of the required
collateral will be maintained in order to ensure that the net exposure of the counterparties
does not exceed the limits specified for counterparties in Article 4 No. 4 a) of the
Management Regulations (General Section). Collateral may be deposited in the form of
securities or cash. Collateral not deposited as cash is neither sold nor reinvested,
encumbered or lent out further.
In order to reduce the risk of loss associated with reinvestment, the reinvestment of cash
collateral received is limited to high-quality bonds issued or guaranteed (with at least an
investment grade rating) by a Member State of the European Union or its regional
administrative units, by a non-EU state or a public international body of which at least one
EU Member State is a member, and short-term money market funds.
Cash collateral in connection with reverse repurchase agreements may also be invested with
credit institutions, provided it can be guaranteed that the accrued credit balance can be
reclaimed at any time. However, collateralised securities may not, sold or otherwise, be
provided as collateral or pledged.
If the Fund receives collateral for at least 30% of its assets, the liquidity risk is analysed.
The strategy for liquidity stress tests should include specifications on the following aspects:
Concepts for stress test scenario analysis, including calibration, certification and
sensitivity analysis;
Empirical approaches to impact assessment, including the backtesting of liquidity risk
estimates;
Reporting frequency and reporting limits/loss tolerance threshold(s), and;
Measures aimed at containing losses, including haircut strategies and gap risk
protection.
The Management Company currently only accepts cash (irrespective of its residual
maturity), both in the sub-fund currency and the currency in which the derivative is listed,
and government bonds as collateral. A specific discount is determined for each bond which
serves as collateral. This discount depends on both the type of bond and the valuation of
liquidity in accordance with the aforementioned tests, and amounts to between 3% and
10%.
22
The Fund may be fully collateralised by securities issued or guaranteed by a Member State
of the European Union or its regional administrative units, by a non-EU state or a public
international body of which at least one EU Member State is a member.
The Management Company will also ensure that the risk diversification provisions are
complied with in accordance with ESMA/2014/937.
Collateral provided must be adequately diversified in respect of the issuer, countries and
markets.
Securities admitted to trading on a stock exchange or on another organised market or
included in it shall be valued at the closing price of the previous day or the closing price
of the same day if it is already available at the time of the valuation. The valuation shall be
carried out accordingly in order to obtain the most accurate market value possible of the
collateral.
The collateral shall be held by the Depositary or a sub-Depositary of the Depositary .
Cash collateral in the form of bank deposits may be held in blocked accounts with the
Depositary of the Fund or at another bank subject to the Depositary ’s consent.
Conflicts of interest
The Management Company, the Depositary , the Distributors and, under certain
circumstances, the investment manager belong to the same group that offers its customers
all types of banking and capital investment services. The Fund is not barred from entering
into transactions with the Management Company, the Depositary , the Distributor or a
possible investment manager or with any companies affiliated therewith provided that
these transactions take place under normal market conditions and on conventional terms
and conditions. To the extent the Fund uses derivatives and other techniques and
instruments, units of the same group may act as counterparty for financial futures
transactions entered into by the Fund. Consequently, conflicts of interest may arise
between the various activities of these companies and their responsibilities and duties with
respect to the Fund. The Management Company has taken appropriate measures to avoid
conflicts of interest. If unavoidable conflicts of interest arise, the Management Company
shall endeavour to ensure that such conflicts of interest are handled in a fair manner and
that they are resolved for the benefit of the Fund. It is the policy of the Management
Company to take all appropriate steps to create organisational structures and to apply
effective administrative measures to identify, address and monitor the relevant conflicts.
Furthermore, the management of the Management Company is responsible for ensuring
that the systems, controls and procedures of the Company are suitable for identifying,
monitoring and resolving conflicts of interest.
Issue, redemption and conversion of Units
Units may be purchased and redeemed, as well as exchanged for Units in another sub-fund
at the offices of the Management Company, the Depositary and the Paying Agents listed
in the appendix to the Management Regulations. In addition, it is possible to purchase
Units through third parties, in particular through other banks and financial services
providers. The Management Company, Depositary and intermediary offices shall comply
at all times with the applicable statutory and other regulations to combat money laundering
and the financing of terrorism.
23
Subscription and redemption of Units should be for investment purposes only. The
Management Company does not tolerate market timing or other excessive trading
practices.
Excessive trading in rapid succession (market timing) may disrupt investment strategies
and harm the Fund’s performance. To prevent harm to the Fund and its Unitholders, the
Management Company expressly reserves the right to reject any subscription application
or to levy an additional subscription charge of 2% of the value of the application concerned
in favour of the Fund Assets. The Management Company will exercise this right at its full
discretion if a Unitholder is engaging in excessive trading in rapid succession or has a
history of excessive trading, or if in the opinion of the Management Company, a
Unitholder’s trading has been or may in future be damaging to the Fund. In making this
judgment, the Management Company may consider the Unitholder’s trading in other funds
or sub-funds in which the individual holds Units or is the indirect beneficiary of such
holdings. The Management Company shall also have the right to compulsorily redeem all
Units held by a Unitholder who is or has been engaged in excessive trading of Units in
rapid succession.
The Management Company shall not be liable for any financial losses resulting from
rejected subscription applications or compulsory redemptions.
US investors
No measures have been taken to register units under the current US Securities Act of 1933,
as amended.
They may not be offered or sold in the United States, its territories and any regions subject
to US jurisdiction; neither may they be offered or sold to US citizens or persons who would
acquire the units for the account of or in favour of US citizens, nor may they be acquired
by such individuals.
Publications
The following documents are available for inspection during normal business hours at the
registered office of the Management Company:
Prospectus;
Management Regulations;
KII;
Depositary Agreement, Investment Manager Agreement and/or Investment
Advisor Agreement;
Current annual and semi-annual reports.
The Prospectus may either be available in the form of a durable medium or on a website.
A paper version is available to investors upon request at no charge.
The Management Company will ensure that information intended for the Unitholders is
either published or communicated to them in an appropriate manner. This includes, in
particular, publication of Unit prices in those countries in which Fund Units are offered for
sale to the public. The Management Company may also arrange for further publications.
The issue and redemption prices can also be obtained from the Management Company, the
Depositary and the Paying Agents. Annual and Semi-Annual Reports as well as the
24
Prospectus, the KII and the Fund’s Management Regulations are also available free of
charge upon request from these parties. The Fund’s Depositary Agreement may also be
inspected at the offices of the Paying Agents.
Notes on taxation
The following summary was created on the basis of the laws and administrative practice
at the time the Prospectus was prepared and may be subject to change.
The Fund is subject in the Grand Duchy of Luxembourg solely to an annual subscription
tax (“taxe d’abonnement”) of up to 0.05% p.a. of the Fund’s net assets as reported at the
end of each quarter for Unit Classes EUR and EUR H and up to 0.01% for Unit Classes I
and I H. If a fund only includes institutional investors within the meaning of Article 174 of
the Law of 2010, an annual “taxe d’abonnement” of 0.01% of the Net Fund Assets is raised.
If the Fund invests in other Luxembourg UCI, which in turn are subject to the taxe
d’abonnement, the aforementioned tax is not due from the Fund on the portion of assets
invested therein. Other taxes on the Fund, for example on income, capital gains or
distributions, are not levied in Luxembourg. However, income, capital gains or
distributions of the Fund may be subject to non-refundable withholding taxes or other taxes
in countries in which the Fund Assets are invested. Neither the Management Company nor
the Depositary will obtain receipts for such withholding taxes for individual or all
Unitholders.
Income, profits and distributions of the Fund are in principle not subject to tax for investors
not resident in Luxembourg (i.e. exceptions may apply to investors who are resident in
Luxembourg or operate a business there). Investors should contact their tax advisor
regarding tax laws and regulations that apply to them. Nevertheless, income, capital gains
and distributions of the Fund may be subject to withholding taxes or other non-
reimbursable taxes in countries in which the Fund invests its assets.
The tax information contained in this Prospectus should not be regarded as tax advice for
potential investors.
Foreign Account Tax Compliance Act – “FATCA”
The provisions of the Foreign Account Tax Compliance Act (generally known as
“FATCA”) are part of the Hiring Incentives to Restore Employment Act (the “Hire Act”),
which came into force in the USA in March 2010. These provisions of US law help combat
tax evasion by US citizens. They state that financial institutions outside the USA (“foreign
financial institutions” or “FFIs”) are obliged to make annual disclosures to the Internal
Revenue Service (“IRS”) on “financial accounts” directly or indirectly held by “specified
US persons”. In general, FFIs who fail to comply with this reporting obligation are subject
to a withholding tax deduction of 30% on certain income from US sources. These
regulations are being introduced gradually over the period between 1 July 2014 and 2017.
In principle, non-US funds, such as this Fund for example, have FFI status and must
conclude an FFI agreement with the IRS, unless they are classified as “FATCA compliant”
or, subject to an inter-governmental model 1 agreement (“IGA”), meet the requirements of
the IGA of their homeland either as a reporting financial institution or as a non-reporting
financial institution. IGAs are agreements between the USA and other countries to
implement the FATCA requirements. On 28 March 2014, Luxembourg concluded an inter-
governmental agreement with the USA and signed a corresponding Memorandum of
25
Understanding. The Fund must therefore comply with the provisions of such a
Luxembourg IGA at the given time.
The Management Company shall continuously assess the extent of the requirements which
FATCA and in particular the Luxembourg IGA place on it. In this context, it may be
necessary for the Management Company to ask all investors to present the required
documents as evidence of their tax residence, which they can then use as a basis to check
whether they are to be classified as specified US persons.
Investors and intermediaries acting on behalf of investors must be aware that units cannot
be offered or sold for the account of US persons according to the applicable principles of
the Fund and subsequent transfers of units to US persons are forbidden. Where units are
held by a US person as the beneficial owner, the Management Company may perform a
compulsory repurchase of the corresponding units at its own discretion. Investors must
also be aware that the definition of specified US persons within the meaning of the FATCA
provisions covers a broader range of investors than the current definition of US persons.
As soon as more is known about the implementation of the IGA between Luxembourg and
the USA, the Management Company may therefore resolve that it is in the interests of the
Fund to make the criteria for the type of investors who are forbidden to invest in the Fund
in future more strict and to develop proposals for how to act in the event that existing
investors like this already hold units.
Common Reporting Standard – CRS
To facilitate a comprehensive and multilateral automatic exchange of information on a
global level, the OECD was commissioned by the G8/G20 countries to work out a global
reporting standard. This reporting standard was incorporated in the amended Directive on
Administrative Cooperation (“DAC 2”) of 9 December 2014. The EU member states were
required to incorporate this Directive into national legislation by 31 December 2015. This
was effected in Luxembourg by a law enacted on 18 December 2015 (the “CRS law”,
published in the Mémorial A – no. 244 on 24 December 2015).
Under the Common Reporting Standard, certain financial institutions under Luxembourg
law are required to identify their account holders and to determine the tax residence of the
account holders. Investment funds such as this one count as financial institutions under
Luxembourg law. For this purpose, a financial institution under Luxembourg law which is
to be regarded as a reporting financial institution must use a questionnaire to determine the
status within the meaning of the CRS and/or the tax residence of its account holders when
accounts are opened.
Luxembourg reporting financial institutions must convey to the Luxembourg Tax
Administration (Administration des Contributions Directes) information about holders of
financial accounts for the first time for the year 2016. This transfer must take place by 30
June 2017 and also cover (in certain cases) the controlling persons who have tax residence
in a reportable state which is specified by a Grand-Ducal regulation. From the end of
September 2017, the Luxembourg Tax Administration will exchange this information
automatically with the relevant foreign tax authorities.
26
Data protection
In accordance with the CRS law and the Luxembourg data protection provisions, every
relevant party, i.e. potentially reportable natural persons, must be informed by the
Luxembourg reporting financial institution about the processing of their personal data
before it is carried out.
If the Fund is classified as a reporting financial institution, it must provide notification
about this to the natural persons who are notifiable persons as defined by the above
explanations in accordance with the Luxembourg data protection regulations.
The reporting financial institution is responsible for processing personal data and it is the
office responsible for processing for the purposes of the CRS law.
The personal data are designated for processing as defined by the CRS Law.
The data can be notified to the Luxembourg Tax Administration (Administration
des Contributions Directes) which will, if necessary, forward it to the relevant
authority/authorities of one or more reportable countries.
If a request for information for the purposes of the CRS law is sent to the relevant
natural person, this person is required to provide an answer. Failure to provide an
answer within the prescribed period may result in an (incorrect or duplicated)
notification of the account to the Luxembourg Tax Administration.
Each affected natural person has the right to inspect the data conveyed to the Luxembourg
Tax Administration for the purposes of the CRS law and to correct it if necessary.
Prevention of money laundering and the financing of terrorism
In accordance with international regulations and applicable Luxembourg laws and regulations
(consisting of, but not limited to, the Law of 12 November 2004 on combating money
laundering and the financing of terrorism, as amended) as well as the CSSF circulars, all
financial sector service providers are obligated to prevent the use of UCI for the purposes of
money laundering and the financing of terrorism.
A consequence of these provisions is that the identity of the subscriber of the Management
Company, the Depositary or the paying agents must be ascertained, unless the subscription
request has already been reviewed by a suitable service provider in the financial sector, who
is subject to equivalent identification requirements, such as those stipulated in Luxembourg
laws and regulations.
Service providers may require subscribers to provide acceptable proof of identity. Subscribers
who are legal persons must provide an excerpt from the Commercial Register or their
company’s articles of incorporation or other official documents.
In any case, the Paying Agent may request additional documents at any time in order to
comply with the applicable statutory and regulatory requirements.
The above information is collected only for the purposes of compliance and may not be
disclosed to unauthorised persons.
27
If a subscriber is late in submitting the required documents or fails to submit the required
documents, the application for subscription (or, if applicable, for redemption) will not be
accepted.
Neither the Management Company nor the Paying Agent is liable for delays or omissions in
the processing of subscription applications resulting from a subscriber’s failure to submit
documentation or submission of incomplete documentation.
As part of ongoing customer due diligence, unitholders may from time to time be required to
submit additional or updated identification documents under the relevant laws and
regulations.
Risk warnings
The following risk information gives an indication of the risks associated with an
investment in the Fund, from which losses (including additional costs) may arise for the
Fund and the investors. Potential investors should read the entire Prospectus and consult
with their legal, tax and financial advisors before making any decision to invest in the
Fund.
General
The assets in which the Fund invests contain both opportunities for growth as well as risks.
Capital losses may occur if the market value of the assets falls below the initial purchase
price. If unitholders sell units of the Fund at a time when the price of the assets in the fund
has fallen compared with the date of purchase, they will not receive back the money
invested in the Fund or will not receive the full amount invested. Although each fund
strives for regular growth, such growth cannot be guaranteed. The risk of the unitholders
is, however, limited to the sum invested.
Performance risk
In the absence of a guarantee, no promise can be made that a positive performance will be
achieved. In addition, assets acquired for the Fund may perform contrary to expectations
at the time of purchase.
Market risk
The price or market trend of financial products is primarily dependent on developments on
the capital markets, which in turn are influenced by the general state of the global economy
and by economic and political conditions in the various countries. Particularly on a stock
exchange, irrational factors such as sentiment, opinions and rumours can also have an
impact on general price movements.
Concentration risk
Further risks may arise from a concentration of investments in particular assets or markets.
This makes the performance of the Fund particularly dependent on these assets or markets.
Issuer risk
The default of an issuer or counterparty can lead to losses for the Fund. The issuer risk
refers to the impact of the specific situation of the issuer concerned, which influences the
price of a security alongside the general trends in the capital markets. Even where securities
are selected carefully, losses due to the bankruptcy of issuers cannot be ruled out.
Counterparty risk
Upon entering into OTC (“over-the-counter”) transactions, the Fund may be exposed to risks
relating to the creditworthiness of its counterparties and their ability to meet the conditions of
28
these agreements. Thus the Fund may, for example, enter into futures, options and swap
transactions or use other derivative techniques, such as total return swaps, and in each case
the Fund is subject to the risk that the counterparty may not meet its obligations arising from
the respective contract.
In the event of the bankruptcy or insolvency of a counterparty, the Fund may suffer significant
losses due to delays in liquidating its positions, including the loss in value of the investments
while the Fund claims its rights. Likewise, there is the possibility that the use of agreed
techniques will be terminated as the result of, for example, bankruptcy, illegality or changes
in the law compared with what was in effect at the time the agreements were made.
Among other things, funds may enter into transactions on OTC and interdealer markets. In
contrast to participants on regulated markets, the participants on these markets are typically
not subject to any financial supervision. A fund investing in swaps, total return swaps,
derivatives, synthetic instruments or other OTC transactions on these markets bears the credit
risk of the counterparty and is also subject to the counterparty’s default risk. These risks can
be significantly different from those of transactions in regulated markets because the latter
are secured by guarantees, daily mark-to-market valuations, daily settlement and
corresponding segregation as well as minimum capital requirements. Transactions entered
into directly between two counterparties generally do not benefit from this protection.
In addition, the Fund is subject to the risk that the counterparty may not execute the transaction
as agreed because of a disagreement concerning the contractual conditions (regardless of
whether in good faith or not) or because of a credit or liquidity problem. This may lead to
losses in the respective Fund. This counterparty risk increases for agreements with longer
maturities, as events may hamper agreement, or when the Fund has directed its transactions
towards a single counterparty or a small group of counterparties.
If the counterparty defaults, the Fund may be subject to adverse market movements while
taking measures to replace transactions. The Fund may enter into transactions with any
counterparty. It may also enter into an unlimited number of transactions with a single
counterparty. The Fund’s ability to enter into transactions with any counterparty, the absence
of an informative and independent evaluation of the financial characteristics of the
counterparty and the absence of a regulated market for entering into agreements may increase
the loss potential of the Fund.
Credit risk
Investors should be aware that such an investment may entail credit risks. Bonds or debt
instruments entail a credit risk relating to the issuer, for which the issuer’s credit rating
may serve as a risk indicator. Bonds or debt instruments of an issuer with a poor rating
are normally regarded as securities with a higher credit risk and a higher probability of
default by the issuer than securities of an issuer with a better rating. If an issuer of bonds
or debt instruments experiences financial or economic difficulties, this may affect the
value of the bonds or debt instruments (it may fall to zero) and the payments made in
respect of these bonds or debt instruments (they may fall to zero). Furthermore, some
bonds or debt instruments may have a subordinate ranking in the financial structure of an
issuer. Consequently, there may be severe losses in the case of financial difficulties. At
the same time, the likelihood of the issuer fulfilling these obligations is lower than with
other bonds or debt instruments. This in turn leads to a high price volatility of these
instruments.
29
Risks associated with receiving collateral
The Fund receives collateral for derivative transactions, securities lending and repurchase
agreements. Derivatives, loaned securities or securities transferred under repurchase
agreements may increase in value. The collateral provided may then no longer be
sufficient to fully cover the Fund’s right of delivery or retransfer in respect of the
counterparty.
The Fund may place cash collateral in blocked accounts, in high-quality government
bonds (irrespective of their term) or in money market funds with short maturity
structures. However, the bank at which the credit balance is held may fail. Government
bonds and money market funds can decline. Upon completion of the transaction, the
collateral placed may no longer be available in full, although it has to be returned by the
Fund in the amount originally received. The Fund may then be required to replenish the
collateral to the amount granted and thereby compensate for the loss incurred by the
investment.
Risks in connection with the management of collateral
The Fund receives collateral for derivative transactions, securities lending and repurchase
agreements. The management of this collateral requires the use of systems and the
definition of specific processes. The failure of these processes or human or system
failures at the Management Company or external third parties in connection with
management of the collateral may produce a risk that the collateral loses value and is no
longer adequate to cover in full the Fund’s right of delivery or retransfer in respect of the
counterparty.
Risk in connection with the use of securities lending and repurchase agreements
Should the counterparty of a securities lending or repurchase agreement default, the Fund
may suffer a loss in such a way that the income from the sale of collateral held by the Fund
in connection with the securities lending or repurchase agreement is lower than the transferred
securities. In addition, the Fund may suffer losses as the result of the bankruptcy of or similar
proceedings against the counterparty of the securities lending or repurchase agreement or any
other type of non-fulfilment of the return of the securities, e.g. loss of interest or loss of the
respective securities as well as default charges and enforcement costs in relation to the
securities lending or repurchase agreement. It is expected that the use of purchases with a
repurchase option, a reverse repurchase agreement or a securities lending agreement will have
no significant impact on the performance of the sub-fund. However, such use may have a
significant effect, either positive or negative, on the Net Asset Value of the sub-fund.
Counterparty risk
The Fund may incur losses due to the default of an issuer or counterparty. Issuer risk
describes the effect of specific developments on an individual issuer that have an impact
on the price of a security in addition to general capital market trends. Even when securities
are carefully selected, losses due to the financial collapse of issuers cannot be ruled out.
Counterparty risk comprises the risk that the other party to an agreement will partially or
fully default on its obligation. This applies to all agreements that are entered into for the
account of the Fund.
30
Safeguarding the rights of unitholders
The Management Company wishes to make unitholders aware of the fact that unitholders
may only assert their rights in their entirety directly against the fund if the unitholder
himself is entered into the unitholder register of the fund under his own name. If a
unitholder invested in a fund via an intermediary, which makes the investment in its own
name but on behalf of the investor, not all unitholder rights may necessarily be asserted
directly by the unitholder against the fund. Unitholders are advised to inform themselves
of their rights.
31
Management Regulations (General Section) ______________________________________________________________________
The general section of these Management Regulations, which was filed with the
Luxembourg Trade and Company Register in the version of 8 September 2017, as
published in the RESA on 15 September, sets out general regulations for the funds managed
by the Management Company in accordance with Part I of the Law of 2010 in the form of
“fonds commun de placement” provided that the special section of the Management
Regulations declares the general section to be an integral part of the Management
Regulations. The specific features of the funds are described in the special section of the
Management Regulations, which may contain provisions which supplement or differ from
individual provisions in the general section of the Management Regulations.
Article 1 General provisions
1. The Fund shall be organised as a legally dependent investment fund (fonds commun
de placement) consisting of securities and other permitted assets, which shall be
managed in line with the principle of risk diversification. The Net Fund Assets must
achieve a minimum value of EUR 1,250,000 within 6 months after the admission of
the Fund by the CSSF. The Fund shall be managed by the Management Company.
The assets in the Fund Assets shall be held by the Depositary .
2. The Unitholders shall each have a claim on the Fund Assets in proportion to their Unit
holdings.
3. By purchasing Units, the Unitholder accepts the Management Regulations including
any approved and published amendments.
4. The current version of these Management Regulations and all amendments shall be
filed with the Commercial Register in Luxembourg and a notice of the filing published
in the RESA”.
Article 2 Depositary
1. The Depositary shall be appointed by the Management Company and is designated in
the special section of these Management Regulations. Its rights and obligations shall be
determined by law, the Depositary Agreement and these Management Regulations. The
Depositary shall act independently of the Management Company and exclusively in
the interests of Unitholders. It shall, however, act in accordance with the Management
Company’s instructions, provided such instructions are in accordance with the
Management Regulations, the Depositary Agreement and the law.
2. The Depositary shall pay to the Management Company out of the Fund’s designated
accounts only such remuneration as is determined in the Management Regulations. It
shall also withdraw the fees payable to itself in accordance with these Management
Regulations subject to the consent of the Management Company. This shall be without
prejudice to the provisions of Article 9 below of the general section of these
Management Regulations relating to the charging of other costs and fees to the Fund
Assets.
32
3. Insofar as is legally permissible, the Depositary shall be entitled and required, in its
own name,
a) to assert Unitholders’ claims against the Management Company or any former
Depositary ;
b) to raise objections against enforcement measures undertaken by third parties and
institute proceedings if an enforcement is made in respect of a claim for liabilities
unrelated to the Fund Assets.
4. The Depositary and the Management Company are entitled to terminate the Depositary
’s appointment in accordance with the provisions of the Depositary Agreement. This
termination shall not take effect, however, until such time as a bank meeting the
requirements of the Law of 2010 assumes the obligations and functions of the
Depositary in accordance with these Management Regulations. Until this time, the
current Depositary shall continue to fully exercise its legal obligations and functions
with the aim of safeguarding the interests of the Unitholders.
Article 3 Fund Management
1. The Management Company is Oppenheim Asset Management Services S.à r.l.
2. The Management Company manages the Fund acting in its own name but in the sole
interest and for the joint account of the unitholders. The administrative powers extend
to the exercise of all rights directly or indirectly associated with the assets of the Fund
or the individual sub-fund. The investment policy is established in compliance with the
legal and contractual investment restrictions. The Management Company shall invest
the Fund Assets separately from its own assets and in line with the principle of risk
diversification. In respect of the rights arising therefrom, the Management Company
shall issue to the unitholders unit certificates or confirmations of their holdings of units
in accordance with Article 5 of these Management Regulations. The Management
Company may, under its own responsibility and at its own expense, consul investment
advisers and/or take advice from an investment committee. The Management Company
may also delegate the fund management or central administration duties to other
Oppenheim Group companies in accordance with current Luxembourg regulations.
Any appointment of a third party shall be appropriately disclosed in the Prospectus.
3. The Management Company is specifically authorised by the provisions of these
Management Regulations to use the funds paid into the Fund by Unitholders to buy
and sell securities and other permitted assets and to reinvest the proceeds elsewhere.
The Management Company is also empowered to take any legal action in matters
relating to the management of the Fund Assets.
Article 4 Investment policy guidelines
1. General information
The investment objectives of the Fund or the respective sub-fund and specific investment
policy shall be determined on the basis of the following guidelines set out in the special
section of these Management Regulations. The special section of these Management
33
Regulations may stipulate that certain types of investments set out here may not be used
for the Fund or the relevant sub-funds and/or may be subject to additional guidelines.
2. Investment-grade Assets
The Management Company shall invest the Assets of the Fund or the sub-fund in:
a. securities and money-market instruments which are traded or listed on a Regulated
Market;
b. securities and money-market instruments which are traded on another market of a
Member State of the European Union which is recognised, regulated, open to the
public and which operates in an orderly manner;
c. securities and money-market instruments which are traded on a securities exchange
of a Third Country or which are officially listed or traded on another market of that
Third Country which is recognised, open to the public and which operates in an
orderly manner;
d. new issues of securities and money-market instruments to the extent that the issue
conditions entail an obligation to apply for admission to trading on a Regulated
Market in accordance with 2 a) to c) above and that such admission to trading be
granted within one year of the issue date;
e. Units in UCITS authorised in accordance with the UCITS Directive and/or other
UCI pursuant to Article 1(2) a) and b) of the UCITS Directive and which are
domiciled in a Member State of the EEC or a Third Country provided that:
these other UCI are authorised under legal provisions which subject
them to official supervision, which the CSSF considers to be
equivalent to that required by European Community law, and that
there is sufficient assurance of co-operation between authorities;
the level of protection of the individuals holding Units in other UCI
is equivalent to the level of protection of holders of Units in UCITS,
which comply with the provisions of the UCITS Directive,
particularly with respect to the separate custody of the Fund Assets,
borrowing, granting of loans and short sales of securities and
money-market instruments;
the results of the operations of the other UCI are reported semi-
annually and annually, thus permitting evaluation of their assets and
liabilities, earnings and transactions for periods under review;
the Articles of Incorporation of the UCITS or other UCI in which
the Units are acquired restrict the amount of assets invested in Units
of other UCITS or other UCI to a maximum of 10% of the total
assets of those UCITS or UCI.
f. demand or other notice deposits with terms of no more than twelve months with
credit institutions domiciled in a Member State of the European Union or, if
domiciled in a Third Country, with credit institutions that are subject to supervision
considered by the CSSF to be equivalent to the provisions regarding bank
supervision in the European Union;
34
g. derivative financial instruments, especially options and futures as well as swaps,
including equivalent instruments entailing cash settlements, which are traded on
one of the Regulated Markets in accordance with sub-sections a), b) and c) above
and/or OTC derivatives financial instruments which are not traded on exchanges,
provided that:
they are the underlyings and instruments as set out in sub-sections
2) a) to h) above and which are financial indices, interest rates,
foreign exchange rates or currencies in which the Fund or sub-fund
may invest in accordance with its investment objectives;
counterparties for OTC derivatives are institutions that are subject
to regulatory supervision and are members of a category authorised
by the CSSF and
the OTC derivatives are subject to reliable and verifiable valuation
on a daily basis and can be sold, settled or closed out at any time by
means of a counter-transaction initiated by the relevant investment
fund at fair market value.
h. money-market instruments which are not traded on Regulated Markets and which
are outside the scope of the above definition, provided that the issue or the issuer
of these instruments are themselves subject to regulations regarding the protection
of deposits and investors and on the condition that the instruments will be
issued or guaranteed by a national, regional or local entity or the
central bank of an EU Member State, by the European Central
Bank, the European Union, the European Investment Bank, a Third
Country, in the case of a federal state by a unit of the federation, or
by an international institution with public sector status to which at
least one EU Member State belongs, or
issued by a company whose securities are traded on a Regulated
Market listed under sub-sections a), b) and c) above or
issued or guaranteed by an institution subject to supervision by a
government regulator in accordance with European Community
law or issued or guaranteed by an institution subject to and in
compliance with supervisory regulations that the CSSF considers
to be at least as stringent as those of European Community law or
issued by another issuer that belongs to a category that is authorised
by the CSSF, provided that investments in these instruments are
subject to regulations protecting investors equivalent to those set
out in the first, second or third bullet point and where the issuer is
either a company with equity capital of at least ten million Euro
(EUR 10,000,000) and which prepares and publishes Annual
Reports in compliance with the Fourth Council Directive
78/660/EEC of 25 July 1978 in connection with the Treaty on the
Annual Accounts of Certain Types of Companies (as subsequently
amended and supplemented) or is a legal entity with responsibility
for group financing within a group comprising one or more
exchange-listed companies or is a legal entity that finances the
securitisation of liabilities by utilizing credit facilities made
available by a bank.
35
3. Other assets
In addition the Fund or sub-fund may:
a. invest a maximum of 10% of the Fund’s net assets in securities and money-market
instruments other than those set out in section 2 above;
b. hold a maximum of 40% of the Fund’s net assets in cash or cash equivalents;
c. take short-term loans not exceeding the equivalent of 10% of the Fund’s net assets.
Hedging transactions in connection with the sale of options or purchase or sale of
forward and futures contracts are not deemed to be loans for the purposes of this
investment restriction;
d. purchase foreign currencies in connection with back-to-back loans.
The Fund or sub-fund is not allowed to carry out securities financing transactions, such
as securities repurchase agreements, securities or commodities lending, buy/sell-back
transactions or sell/buy-back transactions, Lombard credits or total return swaps, within
the meaning of Regulation (EU) 2015/2365 of 25 November 2015 on the transparency of
securities financing transactions and of reuse and amending Regulation (EU) 2012/648.
If there are plans for the Fund to carry out the abovementioned securities financing
transactions, then the available Sales Prospectus will be amended accordingly and
completed with all the necessary information in accordance with the aforementioned
Regulation.
4. Risk diversification
a. The Fund or sub-fund may invest no more than 10% of its net assets in securities
or money-market instruments of a single issuer. The Fund may invest no more than
20% of its net assets in deposits with a single institution. The risk of counterparty
default in connection with fund transactions in OTC derivatives may not exceed
10% of the Fund’s net assets, provided that the counterparty is a credit institution
in accordance with sub-section 2 f). The maximum will otherwise be limited to 5%
of the Fund’s net assets.
b. The total value of securities and money-market instruments of issuers in which the
Fund or sub-fund invests more than 5% of its net assets may not exceed 40% of the
value of its net assets. This limit shall not apply to deposits and transactions in OTC
derivatives with financial institutions which are subject to regulatory supervision.
Notwithstanding the individual maximum limits set out in sub-section 4 a), the
Fund or sub-fund may invest a maximum of 20% of its net assets in a single
institution in one of the following combinations:
securities or money-market instruments issued by that institution,
deposits with the same institutions and/or
OTC derivatives traded with that institution.
c. The maximum limit set out in the first sentence of sub-section 4 a) shall be no more
than 35% if the securities or money-market instruments are issued or guaranteed
by a Member State of the European Union, its regional authorities, a Third Country
36
or an international organisation regulated by public law, of which at least one
Member State of the European Union is a member.
Notwithstanding the provisions under No. 3 a) and b), in accordance with the
principle of risk diversification, a fund or sub-fund may invest up to 100% of the
net Fund Assets in securities and money market instruments of various issuers,
issued or guaranteed by a Member State of the European Union or its regional
authorities, a third country or public international bodies to which one or more
European Union Member States belong, provided (i) such securities were issued
within the framework of at least six (6) different issues and (ii) whereby the
securities of any one issue may not exceed 30% of total net Fund Assets.
d. The maximum limit set out in the first sentence of sub-section 4 a) shall equal 25%
for certain debt securities if issued by a credit institution domiciled in a Member
State of the European Union which is subject to special regulatory supervision in
accordance with statutory provisions intended to protect the holders of those debt
securities. In particular, the proceeds of such issues must be invested in accordance
with statutory provisions in assets that adequately meet the liabilities arising from
the debt securities for their entire term and, in the event of default by the issuer,
that will serve as senior ranking security for the repayment of the principal and
accrued interest.
If the Fund or sub-fund invests more than 5% of its net assets in debt securities in
accordance with the preceding sub-section, which are issued by a single borrower,
the total amount of these investments may not exceed 80% of the value of the net
assets.
e. The securities and money-market instruments set out in sub-sections 4 c) and d)
shall not be included in the calculation for the purposes of applying the maximum
investment limit of 40% set out in sub-section 4 b).
The limits set out in sub-sections 4 a), b), c) and d) may not be cumulated. As a
result, investments in securities and money-market instruments of a single issuer
or deposits with those issuers as well as derivatives of that issuer in accordance
with sub-sections 4 a), b), c) and d) may not exceed 35% of the net assets of the
Fund or the sub-fund.
Companies that are members of the same group, presenting consolidated financial
statements prepared in accordance with Directive 83/349/EEC or with international
accounting standards, shall be treated as a single issuer for the purposes of
calculating the investment limit set out in sub-sections a) to e) above.
A fund’s or sub-fund’s cumulative investments in securities and money-market
instruments issued by a single group of companies may not exceed 20% of its net
assets.
f. Notwithstanding the investment limits set out in sub-sections 4 j), k) and l) below,
the limits set out in sub-sections 4 a) to e) with respect to investments in shares
and/or debt securities of a single issuer may not exceed 20% if the objective of the
Fund’s or sub-fund’s investment policy is to track an equities or debt security index
that is recognised by the CSSF. In that connection:
37
the composition of the index must be sufficiently diversified;
the composition of the index must be broad enough to adequately represent
the market to which it relates;
the index must be adequately publicised.
g. The limits set out in sub-section 4 f) shall be 35% provided that this is justified by
exceptional market conditions, particularly with respect to Regulated Markets
which are significantly dominated by certain securities and money-market
instruments. Investments up to this maximum limit shall be permitted for one issuer
only.
h. The Fund or sub-fund may acquire Units in other UCITS and/or UCI in accordance
with sub-section 2 e) provided that no more than 20% of the Fund’s net assets are
invested in a single UCITS or UCI.
When applying this investment limit, each sub-fund of an umbrella fund as defined
by Article 181 of the Law of 2010 shall be treated as an independent issuer provided
that each sub-fund’s separate liability to third parties is guaranteed.
The investment limits laid down here do not apply to funds or sub-funds that are
feeder funds of a master fund.
i. Combined investments in Units in UCI which are not UCITS may not exceed 30%
of a fund’s or sub-fund’s net assets.
The investment limits laid down here do not apply to funds or sub-funds that are
feeder funds of a master fund.
If the Fund or sub-fund has acquired Units of an UCITS and/or other UCI, the
investments in the relevant UCITS or other UCI shall not be included in the
calculation with respect to the limits set out in sub-sections 4 a) to e).
If a fund or sub-fund acquires Units in another UCITS and/or UCI which is either
directly or indirectly managed by the same Management Company or any other
company with which the Management Company shares common management or
is controlled or related through material direct or indirect shareholdings, the
Management Company or the other company may not charge fees for the
subscription to or redemption of Units of the other UCITS and/or other UCI.
j. The Management Company may not acquire voting shares in respect of investment
funds under its management to the extent that it could exercise considerable
influence on the issuer’s business policy.
k. In addition, a fund or sub-fund may not acquire more than:
10% of any one issuer’s non-voting shares,
10% of any a single issuer’s debt securities,
25% of the Units in a single UCITS or another UCI or sub-fund of an
umbrella fund,
10% of any a single issuer’s money-market instruments.
38
The limits set out in the second, third, and fourth bullet points may be disregarded
for purchases if the total amount of debt securities or money-market instruments or
the net amount of Units issued cannot be calculated at the time of purchase.
l. The provisions set out in sub-sections 4 j) and k) are not applicable to the following
investments:
securities and money-market instruments issued or guaranteed by a
Member State of the European Union or one of its regional authorities;
securities and money-market instruments issued or guaranteed by a
Third Country;
securities and money-market instruments issued by an international
organisation regulated by public law, of which one or more Member
States of the European Union are members;
Shares of companies that have been established under the laws of a
country that is not a Member State of the EU, provided that (i) such
company mainly invests its assets in securities of issuers of that
country, (ii) under the law of this country, an investment by the fund or
the sub-fund in the capital of such a company is the only possible way
to acquire securities issued by issuers in this country and (iii) within the
framework of its investments, this company observes the investment
restrictions under no. 4 a) to e) and no. 4 h) to k) above. However, this
derogation shall only apply if the company from the non-EU Member
State complies with the limits in Articles 43, 46 and 48 of the Law of
2010. If the limits set out in Articles 43 and 46 mentioned above are
exceeded, Article 49 of the Law of 2010 shall apply mutatis mutandis.
m. In addition, a sub-fund may subscribe, acquire and/or hold units of one or more
sub-funds without being subject to the requirements of the Law of 1915 regarding
the subscription, acquisition and/or holding of own units, provided that:
the other sub-fund is not in turn invested in the sub-fund, which has
invested in it; and
no more than 10% of the net assets of the sub-fund whose acquisition is
planned may be invested in units of other UCI; and
any voting rights linked to the relevant units of the other sub-fund are
suspended as long as they are held by the sub-fund concerned,
notwithstanding the appropriate implementation of the accounting
system and the periodic reports; and
in any case as long as the units of the other sub-fund(s) are held by the
sub-fund whose value is not taken into account in calculating the Net
Fund Assets for the purposes of verifying the minimum amount of
assets as provided for in the Law of 2010; and
there is no duplication of the subscription or redemption fees between
those that have invested in other sub-funds at the sub-fund level and
those that have invested at the level of the other sub-fund.
39
5. Inadmissible transactions
The Management Company may not, on behalf of the Fund of sub-fund:
a. purchase commodities or precious metals;
b. invest in real estate, although real-estate-secured securities, including any accrued
interest as well as investments in securities issued by companies that invest
exclusively in real-estate, including accrued interest, are permissible;
c. grant loans from the Fund Assets or act as guarantor for third parties;
d. take on liabilities in connection with the acquisition of any securities or money-
market or other financial instruments that are not fully paid-up, as set out in sub-
sections 2 e), g) and h), which, when combined with loans as set out in sub-section
3 c), exceed 10% of the Fund’s net assets;
e. engage in short sales of securities, money-market instruments or other financial
instruments as set out in sub-sections 2 e), g) and h) above.
6. Exceptions, reductions
a. The investment restrictions set out in sections 2 to 4 above relate to the time of
purchase. If the cited percentages are subsequently exceeded, i.e., as the result of
changing prices or for reasons other than additional purchases, the Management
Company shall immediately, albeit with due regard to the interests of the
Unitholders, attempt to reduce holdings so as to reinstate limits;
b. any newly established funds or sub-funds may, during the first six months
following their establishment, disregard sub-sections 4 a) to i) in order to assure
the diversification of risks;
c. to the extent that an issuer forms a legal entity whose assets serve exclusively to
secure claims by investors in a particular sub-fund as well as by creditors, whose
claims arose in connection with the establishment, operation or dissolution of a
particular sub-fund, that sub-fund shall be treated as an independent issuer for the
purposes of applying the risk distribution provisions in sub-sections 4 a) to g) and
4 h) and i).
The Management Company is entitled to establish additional investment restrictions for
the Fund or sub-fund insofar as such restrictions are necessary to comply with legal and
administrative regulations in those countries in which the Units of the Fund or sub-fund
are offered or sold.
7. Techniques and instruments
a. General provisions
The Fund may use derivatives and other techniques and instruments for the purposes of
hedging and for the efficient management of the assets of the Fund or sub-fund, maturities
and risks.
40
The use of derivatives in connection with these transactions shall be consistent with the
conditions and limits set out in the provisions of sections 2 to 6 of this article. In addition,
the provisions of section 8, below, of this article relating to risk management procedures
shall be observed.
The Fund or sub-fund may under no circumstances disregard the investment objectives set
out in the special section of these Management Regulations when using derivatives or other
techniques and instruments.
b. Securities lending and repurchase agreements
To manage the assets of the Fund or sub-fund efficiently in accordance with the provisions
of Circulars 08/356 and 11/512 of the Commission de Surveillance du Secteur Financier
(CSSF), the Management Company may use the techniques and instruments of the
securities lending and repurchase agreements.
If, in this connection, the Management Company receives collateral in the form of cash, it
may be invested for the Fund or sub-fund in accordance with the provisions of the above
Circular.
8. Risk management
With respect to transactions in derivatives, in accordance with CSSF Circular 11/512, the
Management Company shall assure that the total risk inherent in the derivatives does not
exceed the Fund’s net assets.
The market value of the underlying, the counterparty default risk, future market
fluctuations and settlement date of positions shall all be taken into account when
calculating the total risk.
Subject to the limits set out in sub-section 4 a) of this article, the Fund or sub-fund may
engage in transactions in derivatives as part of its investment policy provided that the total
risk of the underlying does not exceed the investment limits set out in sub-sections 4 a) to
e) of this article, whereby index-based derivatives are excluded.
Derivatives embedded in securities or in money-market instruments shall be included with
respect to the provisions of section 8.
If, in accordance with Article 42 (2) of the Law of 2010, the Fund or sub-fund uses
techniques and instruments, including repurchase agreements and securities lending
transactions in order to increase its leverage or its market risk, the Management Company
must take these transactions into account when calculating the total risk.
Please see the relevant Special Section of the Prospectus for more information on the
determination of the total risk of the Fund or sub-fund.
41
Article 5 Units
1. The Unit certificates are made out to the bearer and are issued for individual or
multiple Units.
2. The Unit certificates bear the original or facsimile signatures of authorised
representatives of the Management Company and the Depositary .
3. Unit certificates are transferable. Upon transfer of a Unit certificate, all rights
represented by the Unit certificate are transferred along with it. The bearer of the Unit
certificate is deemed by the Management Company and/or the Depositary to be the
beneficiary in all cases.
4. At the request of a buyer of Units and on the instructions of the Management
Company, the Depositary may issue confirmation of the number of Units acquired in
lieu of a Unit certificate.
5. The special section of these Management Regulations may stipulate that Units are
evidenced by global certificates. In such cases, there may be no entitlement to
individual certificates.
Article 6 Issue and redemption of Units
1. The Units shall be issued by the Management Company as soon as the issue price has
been paid to the Depositary . There shall generally not be any limitation on the number
of Units issued or on the number of corresponding Unit certificates. However, the
Management Company reserves the right to suspend the issue of Units temporarily or
permanently; in such cases, any payments already made shall be refunded without
delay.
2. Units may be acquired from the Management Company, the Depositary or the Paying
Agent, or through third party intermediaries. All of the above-named entities or other
legal persons charged with distribution must at all times be in compliance with the
statutory and other legal provisions regarding the combating of money laundering and
the financing of terrorism.
3. Unitholders may request the redemption of Units through the Management Company,
Depositary or Paying Agent at any time. The Management Company shall be required
to redeem Units for the account of the Fund or sub-fund at the applicable redemption
price on any Valuation Day.
4. Unless otherwise defined in the special section of these Management Regulations, the
units are valued on each Valuation Day. The redemption price shall be paid without
delay after the Valuation Day in the Fund Currency.
5. Where there is a massive demand for redemption, the Management Company is
entitled, with the prior consent of the Depositary , to redeem the Units at the then
applicable redemption price, when it has disposed of a corresponding amount of assets,
whereby such a disposal is effected without delay but with due regard to the interests
of all Unitholders.
42
6. The Depositary shall be required to make payment only where no statutory provisions,
for example foreign exchange regulations, or other circumstances beyond the control
of the Depositary that prevent remittance of the redemption price.
Article 7 Issue and redemption price
1. To calculate the issue and redemption price, the Management Company or a third party
appointed by it, shall, under the supervision of the Depositary , determine the Net
Asset Value per Unit on every Valuation Day.
For this purpose:
a. securities officially listed on a stock exchange shall be valued at their last
available price;
b. securities that are not officially listed on a stock exchange but which are
traded on a Regulated Market or on other organised markets shall also be
valued at the last available price paid or the last available closing price,
provided the Management Company, at the time of valuation, considers this
price to be the best price at which the securities can be sold;
c. securities whose price is not a fair market price or whose price is not
available pursuant to Article 7 No. 1 a) and b) and all other assets shall be
valued at their probable realisation value, which shall be determined
prudently and in good faith;
d. Units in open-ended UCITS and/or UCI shall be valued at the last
redemption price available;
e. liquid assets shall be valued at their nominal value plus interest;
f. fixed-term deposits shall be valued at their nominal value plus interest;
g. the settlement amount of forward transactions or options not traded on stock
exchanges or organised markets shall be valued at their relevant net
settlement value as set out in the Management Company’s guidelines in a
manner consistent for all types of contracts. The settlement value of forward
transactions and options traded on stock exchanges or organised markets
shall be valued with reference to the last available transaction prices of such
contracts on the stock exchanges or organised markets on which these
forward transactions or options were traded by the Fund. If a forward
transaction or option cannot be settled on the day on which the Fund’s Net
Asset Value per Unit is calculated, the manner in which the contracts are
valued on that day shall be determined in an appropriate and reasonable
manner by the Management Company;
h. money-market instruments which are not listed on a stock exchange or
traded on another Regulated Market and which have a residual term to
maturity at the time of purchase of less than 90 days shall be valued at their
repayment costs, which should roughly correspond to their market value;
43
i. swaps shall be valued at market value after considering the applicable
performance of the underlyings;
j. any assets not denominated in the Fund Currency shall be translated into
the Fund Currency at the last available reference exchange rate as quoted
on the inter-bank market. If such rates are not available, the exchange rate
shall be determined in good faith by the Management Company.
The Management Company may, at its own discretion, use other methods of valuation
if these are in the interest of an appropriate valuation of a Fund’s asset with respect to
the realisable value of that asset.
If the Management Company is of the view that the calculated value of Units on a
given Valuation Day does not reflect the actual value of the Fund’s Units, or if there
have been significant movements on the relevant stock exchanges or markets since the
calculation of the value, the Management Company may decide that the value of the
Units should be restated on that same day. In this event, all applications received for
subscriptions and redemptions for that Valuation Day shall be based on the Unit value
that was restated in good faith by the Management Company.
2. When determining the issue price, an initial charge can be added to the Net Asset Value
per Unit to cover issue costs, the amount of which for the Fund or the respective sub-
fund shall be set out in the special section of the Management Regulations. There shall
be a corresponding increase in the issue price if stamp duties or any other levies are
payable in a country where Units are issued.
3. The Redemption Price shall be determined with reference to the Net Asset Value per
Unit as defined in section 1, after deducting a fee for redemption costs and fees, the
amount of which shall be set out in the special section of the Management Regulations.
4. Orders for the purchase and sale of Units which are received no later than 10.30 a.m. on
a Valuation Day shall be settled at the subscription or redemption price as calculated on
the following Valuation Day, unless otherwise provided in the special section of these
Management Regulations.
Article 8 Suspension
The Management Company is entitled to temporarily suspend the calculation of the value
of Units if this is in the best interests of the Unitholders and for so long as circumstances
persist that require such temporary suspension. In particular:
1. when an exchange or other Regulated Market on which a substantial portion of
relevant Fund Assets are officially listed or traded is closed (other than normal
weekends and bank holidays) or trading on this exchange or market has been
suspended or restricted; or
2. in emergencies, when the Management Company does not have the Fund Assets at its
disposal, or if it is impossible for the Management Company to freely transfer the
equivalent value of the assets bought or sold, or to calculate the value of Units in a
proper manner; or
44
3. if for any other reason the value of an investment of the Fund or sub-fund cannot be
determined accurately or promptly; or
4. if the calculation of the share or unit price in the respective master fund in which the
Fund or one or more sub-funds have invested has been suspended; or
5. if a merger or similar event, which has an effect on the Fund and/or one or more sub-
funds, takes place and if the Management Company deems it necessary and in the best
interest of the unitholders concerned; or
6. in the event of the suspension of an index that underlies a financial derivative
investment and which is significant for the Fund or a sub-fund.
The Management Company shall notify suspensions exceeding three banking days in
length in a suitable manner through publication in those daily newspapers in which fund
prices are normally published. The Management Company shall also directly notify all
Unitholders and applicants for the purchase of Units of the suspension in an appropriate
manner. During the period of any suspension in the calculation of Net Asset Value per
Unit, Unitholders shall be permitted to withdraw their applications for subscriptions and
redemptions. Applications for subscriptions and redemptions that have not been withdrawn
shall be settled on the resumption of the calculation of Net Asset Value per Unit at the
prices determined on the date of such resumption.
Article 9 Costs
1. The Management Company shall be entitled to remuneration for its management of the
Fund and the Depositary shall be entitled to remuneration for the administration and
custody of assets belonging to the Fund. Moreover, the Depositary shall receive a
processing fee for each transaction it executes on behalf of the Management Company.
2. In addition to these remuneration and fees the following expenses shall be charged to
the Fund:
a. taxes and other amounts payable that are charged to the respective sub-fund, its
income or expenses that are charged to this sub-fund;
b. costs arising in connection with the purchase and disposal of assets;
c. costs of preparing and mailing of the Prospectuses, Management Regulations, the
KII as well as the Annual Reports, Semi-Annual Reports and, where applicable,
other Interim Reports;
d. costs of publishing Prospectuses, the Management Regulations, the KII and the
Annual Report, Semi-Annual Report and, where applicable, other Interim Reports
and also of the issue and redemption prices and of notifications to the Unitholders;
e. the costs of auditing, taxation and legal advice to the Fund;
f. costs and any taxes or fees arising in connection with the management of the Fund
and the custody of the Fund Assets;
45
g. costs of preparing Unit certificates and, if applicable, earnings coupons, and of the
renewal of coupon sheets;
h. costs of cashing in earnings coupons, if any;
i. costs of admission to listing on any stock exchange and/or the registration of Units
for distribution to the public;
j. a reasonable proportion of the costs of marketing and advertising and especially
those incurred directly in connection with the offering and selling of Units of the
Fund;
k. costs for the analysis of the performance of the Fund and for the assessment of the
Fund by national and international rating agencies;
l. costs related to all types of risk management of the Fund as well as the measurement
and the analysis of the performance of the Fund, and
m. formation costs of the Fund.
3. All costs will be charged first to current income, then to capital gains, and last to the
Fund Assets.
4. The KII contains information on the Fund’s costs and fees.
Article 10 Accounting year and auditing
1. The Fund and its accounts shall be audited by auditors appointed by the Management
Company.
2. Not later than four months after the end of each financial year, the Management
Company shall publish the audited Annual Report of the Fund.
3. Not later than two months after the end of the first half of the financial year, the
Management Company shall publish an unaudited Semi-Annual Report for the Fund.
4. These reports shall be obtainable from the Management Company, the Depositary and
the Paying Agents.
Article 11 Merger and reorganisation
If, for any reason, the value of the Net Fund Assets of the Fund or a sub-fund or a unit class
falls below a level that the Management Company has established as the minimum amount
for the economically efficient management of the Fund or sub-fund or unit class, or if a
change to the economic or political situation in relation to a fund or sub-fund or unit class
would have substantial negative consequences on the investment of the fund, sub-fund or
unit class, or for the purposes of economic rationalisation, or if the agreement with the
Investment Manager has been terminated and has not been replaced by the replacement
investment manager, the Management Company may decide to require the redemption of
all units of the fund or sub-fund or the unit class(es) concerned at the net asset value per
unit (taking into account the actual investment made and the investment expenses) from
the valuation day on which this decision takes effect.
46
The Management Company’s decision shall be published before the reporting date (either
in newspapers as determined by the Management Company or by notification to the
unitholders at the addresses they have provided in the register of unitholders) in order to
determine the time at which it will enter into force; the publication shall indicate the reason
and the process for the mandatory redemption.
In accordance with the Law of 2010 and the conditions and procedures of the applicable
administrative regulations, the Management Company may, to the extent applicable,
decide to merge one or more sub-funds of the Fund with an existing sub-fund or another
jointly established sub-fund, another Luxembourg fund or sub-fund, another foreign
UCITS or a sub-fund of another foreign UCITS, by either dissolving the fund or sub-fund
without winding-up or by maintaining the fund or sub-fund until all liabilities have been
paid.
Such a decision shall be published in the same manner as described above.
The unitholders have the right within 30 days to request the redemption of their units or,
where applicable, the conversion of their units into units of another fund or sub-fund with
a similar investment policy, which is managed by the same management company or
another company with which the management company is linked by common management
or control or by substantial direct or indirect holding, without incurring any additional costs
beyond those that the fund or sub-fund charges to cover divestment costs.
When the merger becomes effective, the unitholders of the transferring fund or sub-fund
become unitholders of the acquiring fund or sub-fund.
Legal, consulting or administrative costs connected with the preparation for and execution
of a merger shall not be charged to the relevant fund or sub-fund or its unitholders.
If it determines that it is necessary in the interest of the unitholders of the Fund or the
respective sub-fund, or that it is justified by a change in the economic or political situation
in relation to the Fund or sub-fund, which would justify reorganisation of the Fund or sub-
fund either via division or consolidation into two or more sub-funds (followed, where
necessary, by the payment of the amount corresponding to the proportional claim of the
unit owner – that is, an adjustment for fractions of units is made), such a decision may be
made by the Management Company.
Any such decision shall be published in the same manner as described above. The
publication shall also contain information relating to the new sub-funds.
This publication shall take place at least one (1) month before the day on which the
reorganisation takes effect in order to allow unitholders time to redeem some or all of their
units without the payment of a redemption fee.
The credits, which, for whatever reason, cannot be distributed to unitholders, shall initially
be deposited for six (6) months at the Depositary and, after this period, at the Caisse de
Consignation for the account of the entitled unitholders; such amounts shall be forfeited if
not claimed within the statutory limitation period (in principle 30 years).
All redeemed units shall be cancelled.
47
Article 12 Duration and winding-up of the Fund or sub-fund and notice of
termination by the Management Company
1. The Fund has been established for an unlimited period of time; it may however be
wound up at any time by resolution of the Management Company.
2. Notwithstanding section 1, the special section of these Management Regulations may
provide for a limited duration of the Fund or for one or more sub-funds.
3. The Management Company may, subject to notice of at least three months, terminate
its management of the Fund. Such notice shall be published in the RESA and in daily
newspapers, then to be determined, in those countries in which Units are admitted for
sale to the public. When the notice of termination becomes effective, the right of the
Management Company to manage the Fund shall be extinguished. In such a case, the
right of disposition over the Fund shall be transferred to the Depositary , which shall
wind up the Fund in accordance with section 4 below and distribute the proceeds of
liquidation to the Unitholders. During the winding-up period, the Depositary shall be
entitled to claim the management fee set forth in Article 9 above. Subject to the
approval of the CSSF, however, it may decide not to wind up the Fund and distribute
the Fund Assets, but to transfer the management of the Fund, subject to the provisions
of these Management Regulations, to another UCITS management company.
4. The Fund and each individual sub-fund may, however, be wound up at any time by
resolution of the Management Company. If such a winding-up is resolved, this shall be
announced in the RESA and additionally in three daily newspapers. For this purpose
the Management Company shall select, in addition to a daily newspaper in
Luxembourg, daily newspapers in the countries in which the relevant Units are
admitted for sale to the public. The issue, conversion and, where applicable, the
redemption of Units shall be suspended on the day on which the resolution to wind up
the Fund is adopted. The Fund Assets shall be disposed of; the Depositary shall, on
the instructions of the Management Company or, where applicable, of the liquidators
appointed by it or by the Depositary in consultation with the CSSF, distribute the
liquidation proceeds, after deduction of the liquidation costs and fees, among the
Unitholders in proportion to their claims. Liquidation proceeds that have not been
claimed by Unitholders following conclusion of the liquidation process shall, where
required by law, be converted into the currency of Luxembourg and deposited by the
Depositary in escrow with the Caisse de Consignation in Luxembourg for the account
of the entitled Unitholders; such amounts shall be forfeited if not claimed within the
statutory limitation period.
Article 13 Amendments to the Management Regulations
1. The Management Company may at any time, with the consent of the Depositary ,
amend parts or all of the Management Regulations.
2. Amendments to the Management Regulations shall be filed with the Commercial
Register in Luxembourg. Notification of this filing shall be published in the RESA.
48
Article 14 Statutory limitation of claims
Legal claims by Unitholders against the Management Company or Depositary must be
lodged within five years of the origin of the claim. This shall have no effect on the provisions
of Article 12 of these Management Regulations.
Article 15 Place of performance and jurisdiction, contractual language and entry
into force
1. The place of performance shall be the place where the Management Company has its
registered office.
2. Any legal disputes arising between Unitholders, the Management Company and the
Depositary shall be subject to the jurisdiction of the competent court in the Grand Duchy
of Luxembourg. The Management Company and the Depositary shall be entitled to
submit themselves and the Fund to the law and jurisdiction of other countries in which
Units of the Fund are offered for sale in cases where unitholders resident or domiciled in
such countries make claims against the Management Company or the Depositary in
relation to subscription to or redemption of Units.
3. The Management Company and the Depositary may declare translations in the
languages of countries in which Units are admitted for sale to the public to be binding on
themselves and the Fund.
4. The Management Regulations and any amendments thereto enter into force on the day
they are signed.
49
Management Regulations (Special Section) ______________________________________________________________________
The currently valid version of the general section of these Management Regulations that
came into force on 8 September 2017 and has been filed with the Luxembourg Trade and
Company Register is an integral part of each sub-fund of FCP OP MEDICAL (the “Fund”).
Set out below are the provisions of the special section which amend and supplement these
Management Regulations.
Article 16 Name
The Fund is a legally dependent investment fund (“Fonds commun de placement”) under Part
I of the Luxembourg Law of 2010 and has been operating as a “FCP OP MEDICAL”.
Article 17 Depositary
The Depositary shall be Sal. Oppenheim jr. & Cie. Luxembourg S.A.
Article 18 Investment policy The investment objective of the FCP OP MEDICAL – BioHealth-Trends sub-fund is to
generate an attractive value appreciation for the relevant sub-fund.
In order to achieve this investment objective, the Fund Assets are invested worldwide in
line with the principle of risk diversification in shares, share-type securities and
participation certificates, which are listed or traded on a regulated market, which is
recognised, open to the public and operates in an orderly manner, as well as in other
permitted assets.
At least 60% of the value of the UCITS fund is invested in equities, which are admitted to
official trading on a stock exchange or admitted to or included in another organised market
that is not an investment fund.
Fixed and variable rate securities, convertible and option bonds and zero bonds
denominated in the currencies of OECD member states may also be purchased, if this is
considered to be in the interests of the Unitholders. Liquid assets may also be held. In
addition to sight and term deposits, these also include regularly traded money market
instruments with a (residual) term of up to 12 months. Notwithstanding Article 4 No. 4 h)
and i) of the Management Regulations, purchase of investment units in UCITS and/or other
UCIs in terms of Article 4 No. 2 e) of the Management Regulations is limited to a
maximum total of 10% of the Fund’s net assets.
Up to 100% of the Fund’s net assets per sub-fund, but always at least two thirds thereof, is
invested in securities of companies operating in the biotechnology, medical technology,
healthcare and pharmaceutical sectors.
For the purpose of hedging and the efficient management of fund assets, the Fund may also
utilise derivatives and other techniques and instruments, in accordance with the
requirements of the guidelines governing investment policy under the Management
Regulations provisions set out below.
50
Article 19 Unit certificates
1. The Units shall be in the form of global certificates.
2. There is no entitlement to the physical delivery of certificates.
3. The Board of Directors may create one or more unit classes which differ from one
another in their characteristics and may have differing fee structures. If new unit classes
are created the Prospectus will be updated accordingly.
4. If one or more unit classes in terms of No. 3 above are created, the Net Asset Value per
Unit of a unit class shall be determined in accordance with Article 7 of the General
Management Regulations by dividing on any Valuation Day the portion of the Net Asset
Value which corresponds to each unit class by the number of Units of each unit class in
circulation on that Valuation Day.
5. As a rule, hedging costs or income exclusively burden or favour the unit class for which
the hedging transactions were undertaken. Currency hedging transactions could,
however, under some circumstances also have an effect on the Net Asset Value of other
unit classes
Article 20 Fund currency, issue and redemption price
1. The Fund currency is the EURO.
2. The Management Company shall calculate the issue and redemption price under the
supervision of the Depositary on each Valuation Day.
3. The issue price shall be payable to the Depositary two banking days following the
relevant Valuation Day.
4. The initial charge to cover the distribution costs (Article 7 No.2) shall amount to up to
5% of the Net Asset Value per Unit.
5. The Management Company shall be responsible for ensuring the suitable publication of
Unit prices in those countries where the Fund is distributed to the public.
Article 21 Costs
1. The remuneration for the management of the Fund shall amount to up to 1.9% p.a.
calculated with reference to the average Fund Assets as determined on the last Valuation
Day of each month.
2. The remuneration for the Depositary shall amount to up to 0.10% p.a. (plus value added
tax) calculated with reference to the average Net Fund Assets (plus VAT) as
determined on the last Valuation Day of each month.
3. The remuneration shall be paid monthly on the last day of the month.
51
4. In addition to the remuneration in accordance with section 2, the Depositary shall
receive a processing fee of up to 0.125% for each transaction insofar as such
transactions are not subject to normal banking commissions.
5. In addition, the Investment Adviser may receive a performance fee. If payable, the
performance fee corresponds to 15% (Unit Classes EUR and EUR H) or 10% (Unit Class
I, Unit Class I H and Unit Class I X) of the surplus capital growth in relation to the Net
Asset Value per Unit and half-year. The surplus capital growth is the capital growth per
half-year in excess of 2.5%, adjusted by previous distributions and fractional financial
years.
The performance fee is calculated on each Valuation Day and set aside accordingly; it
is only paid when and if the Specific Net Asset Value per Unit reaches, at half year end,
a new high, compared to the high at the previous half year end (the “High Water Mark”)
and only on the new excess appreciation over the said high at the end of the previous
half year for the Specific Net Asset Value per Unit. The Net Asset Value per Unit is
adjusted by any distributions that may arise.
6. The Management Company is permitted to grant refunds and portfolio management
fees out of the Management Fee. Payment of refunds and portfolio management fees
does not incur additional charges for the Fund.
7. The Management Company may retain discounts from broker’s or portfolio
commissions paid for the account of the Fund, which do not have to be credited to the
Fund Assets, as well as enter into agreements on “Soft Commissions”. Notwithstanding
this, equities and market partners are selected in line with the principle of best execution
and exclusively in the interests of the Unitholders of the Fund.
Commission agreements in the form of “Soft Commissions” may be entered into under
the following conditions:
a. The Management Company shall act at all times in the best interests of the Fund.
b. The payments made are directly connected with the activities of the Management
Company for the Fund.
c. Broker’s fees on portfolio transactions of the Fund are paid exclusively to broker-
dealers which are legal entities and not individuals.
d. Agreements concerning soft commissions are published in the Annual Report.
If the Management Company retains discounts from broker’s or portfolio commissions,
these shall also be published in the Annual Report.
8. In addition to these payments and fees, the costs listed in Article 9 No. 2 shall be charged
to the Fund.
9. Further to Article 4 No. 4 letter i) of the General Section of the Management
Regulations, no management fees from investments in Units of other UCITS and/or
other UCIs shall be charged to the Fund, if these are managed directly or indirectly by
the same Management Company or by another company affiliated to the Management
Company, either through common management or control, or through a substantial
52
direct or indirect holding, unless such other UCITS and/or other UCI does not levy a
management fee itself. In terms of Article 4 No. 4 i) and the present Article 20 No. 9,
“substantial” means a direct or indirect holding of more than 10 per cent of the capital
or votes.
Article 22 Distributions
1. The Management Company shall determine in each year whether income should be
distributed and, if so, the amount of such distributions. This determination shall be made
in accordance with Luxembourg regulations.
2. Distributions shall be made on those Units in issue on the distribution day.
3. Any distributions not paid out within five years of the announcement of that distribution
shall expire in favour of the Fund. That notwithstanding, the Management Company
shall be entitled to pay any undistributed amounts to Unitholders following the period
of statutory limitations.
Article 23 Sub-funds
1. The Management Company may launch new sub-funds at any time, with different
investment objectives or reference currencies from those of the existing sub-funds. If a
new sub-fund is launched, the Prospectus shall be updated accordingly.
2. The rights of the investors and creditors in regard to a sub-fund or rights in connection
with the creation, management or winding up of a sub-fund shall be limited to the assets
of that sub-fund. The assets of a sub-fund are liable solely to the extent of the
investments of the investors in that sub-fund and to the extent of the claims of those
creditors whose claims arose at the time the sub-fund was created, in connection with
the management or winding up of the said sub-fund.
3. In the relationship between the Unitholders, each sub-fund shall be treated as an
independent entity.
4. The investment policy guidelines set forth in Article 4 of the General Section of the
Management Regulations, including the stated percentages, relate both to the entire
Fund assets and to the Fund assets of each sub-fund, with the exception of Article 4 No.
4 k), which relates to the entire Fund assets. The provision in Article 4 No. 6 b) of the
General Section of the Management Regulations applies mutatis mutandis to the launch
of any sub-fund.
5. The Net Asset Value per sub-fund is denominated in the Fund Currency of each sub-
fund. The Net Asset Value is calculated as per Article 7 of the General Section of the
Management Regulations by dividing the assets belonging to the sub-fund less the
liabilities of the sub-fund by the number of Units of the respective sub-fund in
circulation on any Valuation Day.
6. Analogously to application of Article 6 of the General Section of the Management
Regulations, payment of the Issue Price is made at the time of Unit subscription and
payment of the Redemption Price at the time of Unit redemption in the Fund Currency
specified for each sub-fund.
53
7. Unitholders may ask at any time to exchange their Units in a sub-fund and a unit class
for Units in a different sub-fund and/or a different unit class at the Net Asset Value of
the Units concerned.
Units of a sub-fund and a unit class are exchanged for Units of another sub-fund and/or
another unit class in a sub-fund without an exchange fee, although the actual costs of
the exchange may be invoiced up to a maximum percentage as shown in the summary
in the first section of the Prospectus. Residual values remaining after the exchange
which do not constitute full Units shall be paid out to the Unitholder in cash. The
Management Company may also apply restrictions to such transactions, although no
such restrictions exist at present.
8. Analogously to application of Article 8 of the General Section of the Management
Regulations, the Management Company is authorised to temporarily suspend
calculation of the Unit value for each sub-fund.
9. Each sub-fund may be wound up individually by resolution of the Management
Company, without this resulting in the winding up of another sub-fund. Only the
winding up of the last remaining sub-fund will automatically result in the Fund being
wound up in terms of Article 145 Paragraph 1 of the Law of 2010. Liquidation proceeds
which have not been collected by Unitholders within, in general, the legally established
deadline after the resolution of the Management Company to dissolve the sub-fund,
will, where legally required, be converted into Luxembourg’s national currency and
deposited by the Depositary for the account of the beneficiary Unitholders at the Caisse
de Consignation in Luxembourg, where such amounts shall lapse unless collected there
within the statutory time limit.
10. Separate account books shall be kept for each sub-fund in the accounting currency of that
sub-fund. The Annual Reports shall also be presented in the accounting currency of each
sub-fund. A consolidated financial statement shall also be prepared in euros for the Fund
as a whole.
Article 24 Financial year
The Fund’s financial year commences on 1 January and ends on 31 December of each year.
Article 25 Entry into force
These Management Regulations entered into force in their currently valid version on 8
September 2017.
54
The Oppenheim Asset Management Services S.à r.l. Funds
3V Invest Swiss Small & Mid Cap HLE Active Managed Portfolio Ausgewogen
Aktienstrategie MultiManager OP HLE Active Managed Portfolio Dynamisch
Alternative Risk Premia Investment Fund SICAV HLE Active Managed Portfolio Konservativ
AW Stocks Alpha Plus OP LC (Lux)
CASH PLUS ML Funds
Movestic MF Movestic SICAV
DB PWM I SICAV Multi Invest Global OP
DB PWM II SICAV Multi Invest OP
DB PWM III SICAV Multi Invest Spezial OP
Deutsche MAG FI Nürnberger Garantiefonds
ERBA Invest OP OCP International OP
EuroSwitch Balanced Portfolio OP OP Portfolio G
EuroSwitch Substantial Markets OP PHARMA/wHEALTH
EuroSwitch World Profile StarLux OP Private Equity Pl
FCP OP MEDICAL PTAM Balanced Portfolio OP
FFPB Dynamik PTAM Defensive Portfolio OP
FFPB Fokus Rentenstrategie MultiManager OP
FFPB Kupon SOP GlobaleAktienAllokation
FFPB MultiTrend Doppelplus Special Opportunities OP
FFPB MultiTrend Plus Storm Fund II
FFPB Rendite Tiberius
FFPB Variabel Tiberius Active Commodity OP
FFPB Wert Tiberius FlexBondPlus
Fullgoal International Funds SICAV Top Ten Classic
GFG Fund SICAV TRI ANGA
GREIFF "special situations" Fund OP US Opportunities OP
GREIFF Defensiv Plus OP Worldwide Investors Portfolio
GREIFF Dynamisch Plus OP
Oppenheim Asset Management Services S.à r.l. also manages funds in accordance with
Section II of the Law of 2010 and funds in accordance with the Law of 13 February 2007
on Specialised Investment Funds.
55
Your Partners
Management Company and Main Office
Oppenheim Asset Management Services S.à r.l.
2, Boulevard Konrad Adenauer
L – 1115 Luxembourg
Equity capital: EUR 2.7 million (as at 31 December 2016)
Board of Directors:
Chairman: Matthias Liermann Managing Director, Deutsche Asset Management Investment GmbH, Frankfurt
Members: Heinz-Wilhelm Fesser Independent member of the Board of Directors
Florian Stanienda Deutsche Asset Management GmbH, Frankfurt
Executive Board:
Thomas Albert, Spokesman of the Executive Board Ralf Rauch Stephan Rudolph
Depositary :
Sal. Oppenheim jr. & Cie. Luxembourg S.A.
2, Boulevard Konrad Adenauer
L – 1115 Luxembourg
Equity capital: EUR 50 million (as at 31 December 2016)
Investment Advisor:
Medical Strategy GmbH
Maria Eich Str. 72
D – 82166 Gräfelfing
(further office: Daimlerstr. 15, D-86356 Neusäß)
www.medicalstrategy.de
Commercial register-nr. B 169574, Munich
Auditors:
KPMG Luxembourg, Société cooperative Wirtschaftsprüfungsgesellschaft Avenue John F. Kennedy L – 1855 Luxembourg
56
Paying Agent in Luxembourg
Sal. Oppenheim jr. & Cie. Luxembourg S.A.
2, Boulevard Konrad Adenauer
L – 1115 Luxembourg
57
Additional information for investors in the Federal Republic of Germany
Paying and Information Agent in Germany
Deutsche Bank Aktiengesellschaft
Taunusanlage 12
D – 60325 Frankfurt am Main
Germany
Applications for redemption and exchange for the Units of FCP OP MEDICAL may be
submitted to the German Paying and Information Agent and all payments (redemption
proceeds, distributions and any other payments) due to Unitholders may be paid through
the German Paying and Information Agent.
All necessary information for investors, those are the Management Regulations, the KII
and the Full Prospectus, Annual and Semi-Annual Reports and issue and redemption
prices, may also be obtained free of charge from the German Paying and Information
Agent. In addition, Unitholders may inspect the Depositary Agreement at the offices of
the German Paying and Information Agent.
Publications
In the Federal Republic of Germany the issue and redemption prices will be published
online at www.oppenheim.lu. Other notices to Unitholders will be published in the Börsen-
Zeitung newspaper. The Management Company may also arrange for other publications.
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Additional information for investors in Austria
Paying Agent in Austria
Deutsche Bank Österreich AG
Head office Vienna
Palais Equitable
Stock im Eisen-Platz 3
A – 1010 Vienna
Redemption applications for the Units of FCP OP Medical may be submitted to the Austrian
Paying Agent and all payments (redemption proceeds, any possible distributions and any
other payments) due to Unitholders may be paid through the Austrian Paying Agent.
All necessary information for investors, e.g. Management Regulations, the KII and the Full
Prospectus, Annual and Semi-Annual Reports as well as issue and redemption prices, may
also be obtained free of charge from the Austrian Paying Agent. In addition, Unitholders may
inspect the Depositary Agreement at the offices of the Austrian Paying Agent.
Tax representative
KPMG Luxembourg, Société Coopérative
39, Avenue John F. Kennedy
L – 1855 Luxemburg
Distribution in Austria
Deutsche Bank Österreich AG
Vienna Main Office
Palais Equitable
Stock im Eisen-Platz 3
A-1010 Vienna
Publications
The issue and redemption prices are published in Austria in “Der Standard”. The
Management Company can also authorise additional publications.