COLL S1.15 Partnerships

(1) A partnership incorporated or otherwise established in the QFC as a partnership (and not a branch) is not an arrangement that is a scheme unless it is—
(a) a CIP; or
(b) another permitted form of QFC scheme.

Note CIP and another permitted form of QFC scheme are defined in div 1.3.B.
(2) A partnership incorporated or otherwise established outside the QFC is not an arrangement that is a scheme unless the arrangement meets the property condition in subrule (3) and the investment condition in subrule (4).
(3) For subrule (2), an arrangement meets the property condition if—
(a) it is made in relation to property that belongs beneficially to, and is managed by or on behalf of, the partnership; and
(b) the partnership has for its purpose the investment of its property with the aim of—
(i) spreading investment risk; and
(ii) giving its members the benefit of the results of the management of its property.
Note Property is defined in the glossary.
(4) For subrule (2), an arrangement meets the investment condition if, in relation to the partnership, a reasonable investor would, if the investor were to take part in the arrangement—
(a) expect to be able to realise, within a period appearing to the investor to be reasonable (or, for a closed-ended corporation, at the end of the corporation's operation), the investor's investment in the arrangement (whether or not represented, at any time, by the value of the investor's percentage interest in, or securities of, the partnership held by the investor as a participant in the arrangement); and
(b) be satisfied that the investment, if realised, would be realised on a basis calculated completely or mainly by reference to the value of property in relation to which the partnership makes arrangements.
(5) However, the Regulatory Authority may, by written notice given to the partnership, declare that subrule (1) or (2) does not apply in relation to the partnership.
(6) The Regulatory Authority may make a declaration under subrule (5) if it considers that making the declaration is desirable to protect—
(a) the interests of participants or potential participants in the partnership; or
(b) the financial system operating in or from the QFC.
(7) If the Regulatory Authority gives the partnership a notice under subrule (5), the notice must—
(a) give reasons for the decision to make the declaration; and
(b) tell the partnership that it may appeal to the Regulatory Tribunal against the decision.
Derived from QFCRA RM/2010-05 (as from 1st January 2011)