The Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996

16.  In section 87 of the 1986 Act (schemes authorised in designated countries or territories)—

(a) at the beginning of subsection (2) there shall be inserted “Subject to subsection (2A) below,”; and

(b) at the end of subsection (2) there shall be inserted the following subsection—

“(2A) Nothing in subsection (2) above shall require the comparison set out in that subsection to be made where—

(a) the class of collective investment schemes to be specified in an order includes schemes having characteristics corresponding to those of an investment company with variable capital; and

(b) having regard to the characteristics of such schemes, it appears more appropriate to consider whether investors in the United Kingdom are afforded protection at least equivalent to that provided for them by the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996;

and, to the extent that the requirements of paragraph (b) above are met, the relevant comparison shall be between the protection afforded to investors in the United Kingdom by the law under which collective investment schemes of the class to be specified in the order are authorised and supervised in the country or territory concerned and the protection provided for such investors by the Open-Ended Investment Companies (Investment Companies with Variable Capital) Regulations 1996.”.