PRIV 7.2.5 Winding-Up by Operator

(1) This rule applies if any of the following circumstances (the prescribed circumstances) exist in relation to a scheme:
(a) on a request by the operator for the cancellation of the scheme's registration, the Regulatory Authority agrees in principle that it will cancel the scheme's registration on the completion of the winding-up of the scheme;
(b) the operator believes, on reasonable grounds, that the scheme is not commercially viable or the scheme's purpose cannot be accomplished;
(c) if the constitutional document states that the duration of the scheme is limited — the scheme's duration ends;
(d) the unitholders of the scheme direct the operator under the constitutional document to wind up the scheme;
(e) if the scheme is subject to a transfer scheme approved under part 7.3 (Transfer schemes) under which it is to be left with no property — the transfer scheme commences.
(2) If any of the prescribed circumstances apply in relation to the scheme—
(a) the operator must cease—
(i) any dealing in the scheme's units; and
(ii) investing or borrowing for the scheme; and

Note Dealing and borrowing are defined in the glossary.
(b) the operator must take the steps necessary to wind up the scheme in accordance with any regulations in force in the QFC that apply to the winding-up, these rules, and any other rules made by the Regulatory Authority that apply to the winding-up.
(3) If any of the prescribed circumstances mentioned in subrule (1) (a) to (d) apply in relation to the scheme—
(a) the operator must realise the scheme property as soon as practicable; and
(b) after meeting or making provision for all the scheme's liabilities and the costs of the winding-up, the operator must distribute the proceeds of the realisation to the unitholders in accordance with the constitutional document; and

Note Constitutional document is defined r 3.1.1.
(c) any unclaimed net proceeds or other cash (including unclaimed distribution payments) held by the operator after the end of 12 months from the day they became payable must be paid into the QFC Court, after meeting or making provision for the costs of paying them into the QFC Court under this paragraph.
(4) If the operator and 1 or more unitholders agree, the requirement to realise the scheme property does not apply to the part of the scheme property proportionate to their entitlement.
(5) The operator may distribute the part of the scheme property mentioned in subrule (4) to the unitholders mentioned in that subrule, after making the adjustments or provisions that appear appropriate to ensure that the unitholders bear a proportionate share of the liabilities of the scheme and the costs of the winding-up.
(6) If the prescribed circumstances mentioned in subrule (1) (e) apply in relation to the scheme, the operator must wind up the scheme in accordance with the approved transfer scheme.
(7) As soon as practicable after starting the winding-up, the operator—
(a) tell the unitholders about the winding-up; and
(b) publish notice of the winding-up in an English and an Arabic language national newspaper and, if the scheme has a website, on the scheme's website.
(8) Not later than 5 business days after the day the winding-up of the scheme is completed, the operator must—
(a) tell the Regulatory Authority about the completion of the winding-up; and
(b) ask the authority to cancel the scheme's registration.
(9) This rule is subject to any order of the QFC Court.

Note Business day is defined in the glossary.
Derived from QFCRA RM/2010-06 (as from 1st January 2011)