1.   Short title


   2.   Interpretation






   3. - 4.   ......




Collective Investment Undertakings


   5.   Application of Act


   6.   Objectives and structure of collective investment undertakings


   7.   Conversion of collective investment undertakings prohibited




General Provisions on the Licensing of Collective Investment Undertakings


   8.   Residence of collective investment undertakings


   9.   ......


   10.   Directors required to be of good repute and competent experience


   11.   Appointment to be approved


   12. - 14.   ......




Unit Trusts


   15.   Management company


   16.   Prohibition on management company engaging in other activities


   17.   Assets of a unit trust


   18.   Trustee


   19.   Obligations of a trustee


   20.   Liability of trustee


   21.   Prohibition on a single company acting as management company and trustee




Investment Companies with Variable Capital


   22.   Licensing by Regulatory Authority


   23.   Share capital of investment companies with variable capital


   24.   Power of company to purchase own shares


   25.   Shareholder can request company to purchase his shares


   26.   Treatment of purchased shares


   27.   Name


   28.   Purchase of shares at request of shareholder and treatment of purchased shares


   29.   Legal reserve


   30.   Restriction of Companies Act


   31.   General






   32.   Assets of investment companies


   33.   Custodian


   34.   Obligations of a custodian


   35.   Exemption from requirement to have custodian


   36.   Liability of custodian


   37.   Prohibition on single company combining functions of investment company and custodian




Investment Policies of Collective Investment Undertakings


   38.   Permitted investments


   39.   Regulations concerning limitations on investments


   40.   Debt instrument, debentures and property required for an investment company's business


   41.   Ancillary liquid assets and investment techniques and instruments


   42.   Securities issued or guaranteed by countries, local authorities or public international bodies


   43.   Investment in other collective investment undertakings


   44.   Acquisition of shares carrying voting rights


   45.   Breaches of limits




General Provisions Relating to Collective Investment Undertakings


   46.   Obligation on collective investment undertaking to purchase units


   47.   Issue of units


   48.   Purchase of units


   49.   Value of assets


   50.   Suspension of purchase of units


   51.   Creation and cancellation of units of unit trust


   52.   Issue of registered certificates or bearer securities


   53.   Replacement of management company, trustee and custodian


   54.   Remuneration and expenditure


   55.   Application of income


   56.   Borrowing


   57.   Granting loans or guarantees


   58.   Sales of securities




Prospectus, Reports and Publication of Information


   59.   Publication of prospectus


   60.   Annexation of trust deed or articles to prospectus


   61.   Offering of prospectus to investors


   62.   Publication of annual and half-yearly reports


   63.   Time limits


   64.   Contents of annual report


   65.   Contents of half yearly report


   66.   Transmission of reports to Regulatory Authority


   67.   Offering of reports to investors before contract concluded


   68.   Reports to be available to public


   69.   Supply of reports to participants


   70.   Auditing requirements in relation to annual report


   71.   Publication of issue and purchase prices


   72.   Publicity and advertising




Special Provisions in Relation to the Regulatory Authority


   73. - 76.   ......




Inspection and Enforcement Powers of the Regulatory Authority


   77.   Compliance with additional requirements imposed by Regulatory Authority


   78.   Keeping of books and records


   79.   Furnishing of information to Regulatory Authority


   80. - 83.   ......




Miscellaneous Provisions


   84.   ......


   85.   Publication and register of names of licensed collective investment undertakings


   86.   Regulatory Authority to approve subsequent changes




Offences, Regulations and Transitional Provisions


   87.   Offences


   88.   Regulations


   89.   Repeal of Act No. 20 of 1996 and savings



Act 20, 1999,
Act 2, 2007.

An Act to provide for the supervision and regulation of collective investment undertakings to enhance protection for investors; and to provide for matters incidental and connected to the foregoing.

[Date of Commencement: 22nd June, 2001]

Preliminary (ss 1-2)


1.   Short title

   This Act may be cited as the Collective Investment Undertakings Act.


2.   Interpretation

   In this Act, unless the context otherwise requires-

   "advertisement" includes the display or publication of any matter by way of leaflet, notice, circular, pamphlet, brochure, photograph, film, video, sound broadcasting, television, electronic communication or personal canvassing;

   "appropriate person" means-


   (a)   an officer of the Regulatory Authority; or


   (b)   in relation to any particular inspection (including a proposed inspection), any other person who, in the opinion of the Regulatory Authority possesses appropriate qualifications or experience to carry out the inspection or any part thereof;

   "articles" and "memorandum" have the meaning ascribed thereto in the Companies Act;

   "associated enterprise" means, as appropriate-


   (a)   a holding company of a management company or trustee;


   (b)   a subsidiary company of a management company or trustee;


   (c)   a company which is a subsidiary of a body corporate, where the management company or investment company or trustee concerned is also a subsidiary of the body corporate, but neither company is a subsidiary of the other;


   (d)   in the case of a management company or investment company or a trustee of a collective investment undertaking, any other body corporate that is not a subsidiary of the management company or trustee but, in respect of which, the company is beneficially entitled to more than 20 per cent in nominal value of either the allotted share capital or of the shares carrying voting rights (other than voting rights which arise only in specified circumstances) in that other body corporate; or


   (e)   a partnership in which the management company or investment company or trustee has an interest, and whose business is or, at the relevant time, was, in the opinion of the Regulatory Authority, materially relevant to any inspection of the management company or investment company or trustee being carried out or proposed to be carried out under this Act;

   "beneficial owner" means a unit-holder with beneficial ownership over property of a unit trust;

   "beneficial ownership" means the rights over the deposited property of a unit-trust conferred by a trust deed on a unit-holder;

   "collective investment undertaking" has the meaning assigned to it in section 6;

   "Companies Act" means the Companies Act, Chapter 42:01 of the Laws of Botswana, or as may subsequently be replaced;

   "country" means an organised political community, unitary or federal, with one sovereign government recognised by the United Nations;

   "custodian" means an entity which meets the qualifying conditions set out in section 33 and which holds the assets of an investment company in accordance with the provisions of this Act;

   "debentures" means any debentures, debenture stock or bonds of any body corporate, incorporated in or outside Botswana, whether constituting a charge on the assets of the body or not;

   "deposited property" means a fund and all undistributed income arising from the investments comprised therein excluding any sums standing for the time being to the credit of a distribution account;

   "director" means a person who, together with other directors, under the Companies Act or a trust deed or a memorandum and articles of a company, represents the management company, the investment company or the trustee or who effectively determines the policy of the management company, the investment company or the trustee;

   "fiduciary duty" means a duty-


   (a)   to act in good faith;


   (b)   not to take a profit out of one's trust other than remuneration previously agreed with the person to whom the fiduciary duty is owed;


   (c)   not to place oneself in a position where one's duty and one's interests may conflict; and


   (d)   not to act for one's own benefit or the benefit of a third person without the informed consent of the person to whom the fiduciary duty is owed;

   "foreign company" means a company incorporated outside Botswana;

   "fund" means the investments and cash for the time being held by a trustee or custodian in trust for the unit-holders or shareholders of a collective investment undertaking in accordance with the provisions of the trust deed or memorandum and articles, as the case may be, with the exception that-


   (a)   it does not include any undistributed net income nor sums standing to the credit of any distribution account; and


   (b)   whenever there is an agreement to purchase or sell investments but such purchase or sale has not been completed, such investments shall be included or excluded, as the case may be, as if the purchase or sale had been completed;

   "holding company" has the meaning ascribed to it under the Companies Act;

   "investment" means the act of placing monetary resources into the creation or acquisition of assets as specified by the Regulatory Authority, including the purchase of real and personal property and securities;

   "investment company" means a company the principal object of which is the investment of its funds in real or personal property of whatever kind;

   "investment company with variable capital" means a company which has a share capital that varies according to the value of the assets which represent the share capital and which satisfies the requirements of section 23;

   "management company" means an incorporated body responsible for the establishment, promotion, management and administration of a collective investment undertaking as laid down in this Act, in regulations or in any other conditions prescribed by the Minister, after consultation with the Regulatory Authority;

   "net asset value" means-


   (a)   the value of a unit trust's fund less the service charge, the administration expenses and the remuneration of the trustee and any other liabilities of the fund not already taken into account in determining the value of the fund and shall include a provision for duties and charges; or


   (b)   the value of a share or shares of a particular class in an investment company for any particular dealing day as determined by the directors in accordance with the articles of that investment company;

   "participant" means either a person who is a shareholder in an investment company or else a unit-holder in a unit-trust, as the context may require;

   "prescribed exemptions" means such exemptions to the provisions of this Act as the Minister may, in accordance with section 88(1), prescribe;

   "purchase of shares or units" includes action taken by an undertaking to ensure that the stock exchange value of its shares or units does not significantly vary from its net asset value;

   "recognised stock exchange" means a stock exchange approved by the Regulatory Authority for the purposes of this Act;

   "Regulatory Authority" means the Non-Bank Financial Institutions Regulatory Authority established under the Non-Bank Financial Institutions Regulatory Authority Act;

   "resident" has the meaning assigned to it in section 8;

   "security" means any medium of investment in the money market or capital market specified by the Regulatory Authority including a government security, a share or debenture, or right or interest, whether described as a unit or otherwise, in any share or debenture or a right, whether actual or contingent, in respect of money lent to, or deposited with, any holder of a licence issued under the Bank of Botswana Act;

   "subsidiary company" has the meaning ascribed to it in the Companies Act;

   "transferable securities" means securities in respect of which the right of transfer is unrestricted;

   "trust" means an obligation imposed by a trust deed binding the trustee to deal with the deposited property solely for the benefit of the unit-holders, anyone of whom may enforce the obligation;

   "trust deed" means a deed formulated as provided for under section 6(5);

   "trustee" means a person or body of persons who fulfils the requirements of a trustee under section 6(6);

   "umbrella fund" means a collective investment undertaking which, to the extent as may be approved and subject to such conditions as may be applied by the Bank of Botswana, may be divided into a number of sub-funds and in which shareholders or unit-holders are entitled to exchange rights in one sub-fund for rights in another;

   "unit-holder" means any person who by reason of the holding of units or shares in a collective investment undertaking or by reason of having invested capital in the collective investment undertaking is entitled to any of the investments or relevant income of the undertaking; and the terms "shareholder" and "participant" shall be construed accordingly;

   "unit of a collective investment undertaking" includes, where the context so requires, a share and any other instrument granting an entitlement to share in the investments or relevant income of an investment company ;

   "unit of a unit trust" means one of the units into which the beneficial interests in the assets subject to the trust are divided or a share or any other instrument granting an entitlement to share in the investments or relevant income of the unit trust;

   "unit trust" means a collective investment undertaking constituted in accordance with the provisions of section 6;

   "usual time limits" means those time limits which are acceptable market practice in the context of a particular transaction.



3. – 4. ......

Collective Investment Undertakings (ss 5-7)


5.   Application of Act

   (1) Subject to any exceptions contained in the provisions of this Act, this Act shall apply to-


   (a)   collective investment undertakings investing in real and personal property and resident in Botswana within the meaning of section 8; and


   (b)   foreign collective investment undertakings marketing or proposing to market their units in Botswana.

   (2) Subject to the exceptions provided for in subsection (3), this Act shall not apply to collective investment undertakings which rai

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