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Law

On Investment Funds


Parliament adopts this Law.

CHAPTER I

GENERAL PROVISIONS


Article 1. Applicability of this Law.

(1) This Law defines the creation, activity and reorganization of Investment Funds.

(2) Stipulations of this Law shall be applied to all Investment Funds, including the Investment Funds for privatization, created or under creation in the Republic of Moldova, if not otherwise stipulated by other laws.

(3) Foundation, functioning and cessation of the Investment Funds' activity which are not stipulated by this Law, shall be regulated by Civil Code, Law on Joint-Stock Companies, legislation on securities and other legal acts.
 

Article 2. Difinition of the Investment Fund.

(1) Investment Fund is an open-end Joint-Stock Company which:

a) attracts means by placing its shares;

b) exerts systematically the investing and reinvesting of the attracted means in other issuers' securities; and

c) rate of the issuers securities in the value of total assets balance constitutes not less than 35%.

(2) Investment Fund is a professional participant in the securities market.

(3) Holding Companies, Banks, Insrance Companies and Pension Funds are not Investment Funds.
 

Article 3. Types and classes of the Investment Funds.
(1). There are several types of Investment Funds, defined according to conditions of placing and refunding of the shares: mutual, on intervals and non-mutual.

(2) The mutual Investment Fund shall place shares permanently with the commitment to refund whenever on order of the shareholders.

(3) The Investment Fund on intervals shall place its shares permanently with the commitment to refund, if so requested by shareholder, on terms determined by the fund's statute and the issue prospect of the shareholders of the fund, but not less than twice a year in the equal time interval.

(4) The non-mutual Investment Fund shall place its shares without the commitment to refund them.

(5) The classification (classes) criteria of the Investment Funds are determined by the legislation on securities.
 

Article 4. Affiliated Persons.

(1) In accordance with this Law, the persons affiliated to other legal or individual entities are as follows:

a) supervise the individuals or legal entities economic agent;

b) are controlled by the individual or legal entity;

c) together with the individual or legal entity economic agent are controlled by a third person;

d) act on behalf and/or at the expense of which the individual or legal entity economic agent acts by proxy, under an agreement or an administrative act; and

e) on behalf and/or at the expense of which the individual or legal entity economic agent acts by proxy, under an agreement or an administrative act; and

f) members of the Observers Council, Directors Council, Committe of Management, Censors (Auditors) Bodies of individual or legal entity economic agent;

g) father, mother, son, daughter, brother, sister or husband (wife) of one's with the responsibility functions indicated in paragraph f).

(2) By control over the individual or legal entity's economic agent is to be understood the ability of any other person to determine the decisions taken by that individual or legal entity's economic agent or to exercise a considerable influence upon the decision-making process.

3) Every person who possesses not less 25% of voting shares or participating shares in the physical or legal entity economic agent capital, is considered exercising control over this individual or legal entity economic agent, provided the person possessing the said number of voting shares or participating shares does not demonstrate the opposite.

(4) Every person possessing less than 25% of voting shares or participating shares in the individual or legal entity economic agent capital is considered as not exercising control over it, if the state antitrust regulatory body, antimonopolizing or the NSC did not demonstrate the opposite.

(5) Control over the individual or legal entity economic agent is exerted on the basis of:

a) property participation of the person supervising the capital of this individual or legal entity economic agent in accordance with paragraph (3); or

b) contract of trust administration or other contract concluded between the person who exercises the control and individual or relevant legal entity's respective economic agent.
 



CHAPTER II

FOUNDATION OF INVESTMENT FUND, CONDITIONS OF FUNCTIONING.

Article 5. Foundation of Investment Fund.

(1) Founders of Investment Fund may be persons indicated in the paragraph (2) Article 3 of the Law on Joint-Stock Companies except the state enterprises and public authorities.

(2) In addition to the provisions of Article 35 paragraph (1) of the Law on Joint-Stock Companies, the Investment Fund statue shall include:

a) type of fund and obligations regarding placing and refunding fund's shares stipulated by Article 3 of this Law;

b) provision that all actions authorized for placing and those placed by fund, are simple nominative shares of only one class.

c) provision that fund shareholders may be persons indicated in Article 24 paragraph (5) of the Law on Joint-Stock Companies except the state enterprises and public authorities;

d) terms for shareholder of the Investment Funds on intervals to submit request of refunding the Fund's shares - for the Investment Funds on intervals;

e) manner of concluding, modification and cancelling contracts with the organizations indicated in Article 6 paragraph (2).

(3) Full name of the Investment Fund shall include:

a) the words AInvestment Fund@;

b) type of fund;

c) specific name of the fund which allows to distinguish the fund from other organizations.

(4) Other persons are not entitled to indicate in their name the words AInvestment Fund@ or other similar words.

(5) Own capital of the mutual Investment Fund and the Investment Funds on intervals shall be not less than 1 mln Lei for each whereas the Statutory Capital of the non-mutual investment fund-not less than 500 thousand Lei.

(6) Investment Fund's shares placed upon its set up shall be payed in cash whereas upon founders' request with the unmonetary depositions, their rate may not exceed 10% from the initial own capital or statutory capital.

(7) Regulations on investments' diversification, determined by Article 15 paragraph (1) shall not be applied to the state registration of the reconstructed investment funds.
 
 

Article 6. Binding conditions of the investment fund's activity.

(1) Investment fund may conduct its activity only after :

a) registration at the NSC of the Fund's regulations rules, mentioned in Article 7;

b) obtaining the licence from the NSC;

c) signing contract with the organizations indicated in paragraph (2) of the trust administration of fund's investments contract on providing services of storage, contract on keeping register and contract regarding the audit control.

(2) Investment Fund duties shall be conducted on the basis of the contract with as follows:

a) the organization of investment administration, hereinafter referred to as fund's manager;

b) the organization which provides services of storage on the securities market, hereinafter referred to as fund's depositary;

c) the organization which keeps the shareholders register, hereinafter referred to as fund's registrar;

d) the audit organization, hereinafter referred to as fund's auditor.

(3) Fund Manager, depositary, and auditor may be only legal entity, the professional participants in the securities market.

(4) Investment Fund may benefit of the services of only one manager only one depositary and only one registrar.

(5) Manager, depositor and registrar of the fund may provide services to one or more investment funds.

(6) Total sum of payments by the investment fund to manager, depositary, registrar, and auditor of fund within one financial year shall be established in the expences estimation of the fund and shall not exceed 5 % of the market average annual value of the funds net assets.

(7) The remuneration sums payed by the investment fund to the manager, depositary, registrar and auditor of the fund, shall be exempted from the Value Added Tax (VAT).

(8) Sample contracts stipulated by Article 1 paragraph c) shall be determined by legislation on securities.
 
 

Article 7. Investment Fund's regulations.

(1) Investment Fund shall elaborate, approve and register:

a) Rules of the Fund Councel;

b) investment's declaration on the Fund;

c) regulations regarding placement and refunding shares by the fund for the mutual and the funds on intervals;

d) regulations regarding establishing ammount of taxes for remuneration for the manager, depositar, registratrar and auditor of the fund.

(2) Investment declaration of the Fund shall include:

a) class of the fund and its relevant obligations;

b) purposes and main directions of the fund's investment activity;

c) restrictions on objects for investment;

d) regulations on regarding diversification of the fund investments;

e) other restrictions on the fund activity.

(3) Pattern declaration on the fund investments shall be established by the legislation on securities.

(4) In order to register the regulations, modifications and addendums, Investment Fund shall submit to the NSC the respective documents not later than 15 days from the date of thier approval.

(5) The non-registration of regulations, modifications and addendums attracts their nulity and the actions undertaken on their basis, are considered as illegal.


CHAPTER III

INVESTMENT FUND ADMINISTRATION.


Article 8. Management bodies.

(1) The management bodies of the investment fund are:

a) the general meeting of shareholders;

b) the observers councel or the directors council (hereinafter Fund's Councel);

c) the audit commission.

(2) The authorization of the executive body of the Fund shall be transmitted to the manager in accordance with this Law, the fund's council regulations and the contract of the trust administration of the fund investments.
 
 

Article 9. General meeting of shareholders.

(1) Unlike the duties established in paragraph (3) Article 50 of the Law on Joint-Stock Companies, within the scope of its exclusive authority, the investment fund general meeting of shareholders shall:

a) approve of the fund regulations, mentioned in paragraphs b)-d) paragraph (1) Article 7 of this Law, and modifications and addendums;

b) shall not confirm the fund auditor and the establishment of his remuneration.

(2) If the fund statute doesn't provide otherwise, in addition to the duties, stipulated in the paragraph (4) Article 50 of the Law on Joint-Stock Companies, in the competence of the general meeting of shareholders are as well:

a) confirmation of the manager, depository, registrar and fund auditor, approval of modification of the main clauses of the contracts indicated in paragraph (c) paragraph (1) Article 6 of this Law;

b) adopting decisions, at the fund's initiative, on cancelling contracts indicated in paragraph a).

(3) The extraordinary general meeting of investment fund shareholders, is convened in accordance with provisions of the paragraph (3) Article 53 of Law on Joint-Stock Companies, as well as on order of manager, depositor and fund auditor.

(4) Besides persons mentioned in the paragraph (2) Article 60 of the Law on Joint-Stock Companies. The following may not be members of the commission established to calculate votes of the general meeting of investment fund shareholders:

a) official persons of the fund manager;

b) officials of the affiliated persons to the manager of the fund.
 
 

Article 10. Fund Council.

(1) The fund council acts on behalf of the investment fund within the limits established by the Law on Joint-Stock Companies, this Law or the fund's statute.

(2) In addition to the duties established in paragraph (2) Article 65 of the Law on Joint-Stock Companies, in the competence of the fund council are:

a) approval of the fund expences estimation;

b) approval the main conditions for transactions on selling of fund property to the fund manager affiliated persons or for purchasing by the fund of the property belonging to the fund manager affiliated persons.

(3) In addition to the duties established in the paragraph (3) Article 65 of the Law on Joint-Stock Companies, in the fund Ñouncil's competence, as provided by the fund statute or by the decision of the fund shareholders general meeting, are:

a) approval of the main clauses of the contracts stipulated in paragraph c) paragraph (1) Article 6 of this Law, as well as their modifications:

b) adopting decision regarding cancelling contracts stipulated in paragraph c) paragraph (1) Article 6 of this Law, at the initiative of depository, registrar or auditor of the fund.

(4) The contracts stipulated in paragraph c) paragraph (1) Article 6 and the modifications of their main clauses shall be signed by the Fund Council Chairman, if the fund statute doesn't grant these responsibilities to other member of the fund council, on the basis of the fund shareholders general meeting decision or the fund council decision.

(5) The number of the fund council members may not be less than 5.

(6) Apart from the persons indicated in the paragraph (5) Article 66 and paragraph (5) Article 73 of the Law on Joint-Stock Companies, the following cannot be members of the fund Council:

a) persons holding responsible positions of the manager, depository and auditor of the fund;

b) persons holding responsible positions of the persons affiliated to the manager, depository and auditor of the fund;

c) physical entities who control the manager, depository, registrar or auditor of the fund.



CHAPTER IV

INVESTMENT FUND ACTIVITY

Article 11. Placement of Additional shares issue.

(1) Investment Fund is entitled to place simple nominative shares of one class only.

(2) On placement by the investment fund of additional issue shares, on the date stipulated in the project of issue of fund's shares in accordance with the securities legislation, the value of additional issue shares is determined by dividing the market value of net assets of the fund to the number of fund's shares in circulation.

3) The additional issue of the investment fund shares shall be paid off by cash only.

(4) At the placement of shares of additional issue, the investment fund is obligted the possibility to be familiarize to offer the shares buyer with:

a) fund's statute;

b) investment declaration of the fund;

c) regulations on placing and repurchase the shares of the shares buyers of the mutual fund or the fund on intervals;

d) prospectus of the fund shares issue.

Article 12. Mutual fund or fund on intervals repurchase of the placed shares.

(1) The share's repurchase value of the mutual investment fund or the fund on intervals is established by dividing the market value of fund net assets to the number of the fund shares in circulation on the date of submitting the demand of repurchase shares by shareholder.

(2) The purchase of the placed shares by the mutual fund or the fund on intervals shall be done by monetary only.

(3) The term of payment for the repurchased shares by the mutual fund or the fund on intervals, shall be established by the fund statute, regulation on the placing or repurchasing the shares of the mutual fund or the fund on intervals, by the prospecting of the fund shares issue and may not exceed 20 days from submitting the demand of the shares repurchasing by the shareholder.

(4) Total number of the repurchased shares by the mutual fund or the fund on intervals shall not be limited.

(5) In case of insufficiency of the monetary means for the placed shares repurchase, the mutual fund or the fund on intervals is obliged to alienate other assets.

(6) Ceasing the purchase of the shares by the mutual fund or the fund on intervals may be authorized by the National Securities Commission only in case of insufficiency of monetary.
 
 

Article 13. Other peculiarities of placing and repurchase shares of the mutual fund or the fund on intervals.

(1) Value of the placement shares and the repurchasing shares must be identic for all buyers of the mutual fund or the fund on intervals as well as its shareholders who made the offers of the shares purchase or submitted the demands of the purchase of shares on the same date.

(2) Fee for services related to placing or repurchase of the investment fund shares may be collected from the shares buyers and/or shareholders according to the limits established by the prospectus of the fund shares (issue) but no more than the limit stipulated by the legislation on securities.

(3) After concluding tranzaction of purchase or repurchase of shares, the mutual fund or the fund on intervals shall issue to the buyer of fund shares or shareholder the document certifying the price of placing or repurchase of the fund shares and the number of purchased or repurchased shares.

(4) Other conditions of placement and repurchase of the investment fund shares are established by the legislation on securities, the fund's statute, the regulations on placement and repurchase of shares of the mutual fund or the fund on intervals as well as the prospectus of issuing fund shares.
 
 

CHAPTER V

RESTRICTIONS ON THE INVESTMENT FUND ACTIVITY.

Article 14. Restrictions on the investment objects.

(1) Investment fund is entitled to invest and reinvest the means in the following objects only:

a) securities of other issuers;

b) shares of participating in the capital of the commercial companies for the non-mutual funds;

c) banking deposits on special banking accounts.

(2) Mutual investment funds or funds on intervals are entitled to invest and reinvest its means only in securities (except the state securities) of other issuers, which are included in the stock-exchange listing and correspond to other restrictions of liquidity, established by the legislation on securities.

(3) Investment Fund is not entitled to invest its means in:

a) other investment funds' shares of which investments are managed by this fund's manager or by the persons affiliated to this manager;

b) any rights on the assets of the manager, depository, registrar, auditor of the fund or the persons affiliated to their economic agents.
 
 

Article 15. Regulations on fund's investments diversification.

(1) Investment fund is entitled to invest and reinvest:

a) no more than 10% of the market value of the net assets in one issuer securities or in quota of participating in commercial company capital;

b) means no more than 5% out of the nominal value of the debts of one issuer.

(2) Regulations on diversification stipulated in paragraph (1) shall not be applicable to the investment or reinvestment of the investment fund means in the state securities.

(3) Investment fund is entitled to invest and reinvest its means reaching no more than 25% out of the securities nominal value, except for debts, or the shares of participating in one commercial company capital. At the same time the fund, the fund manager and the persons affiliated to them, may hold no more than 25% out of the vote shares of one issuer or the participating shares of one commercial company capital.

(4) Non-mutual investment fund is entitled to invest less than 25 % out of the market value of its net assets without observing regulations' normatives stipulated in the paragraph (3).
 
 

Article 16. Other restrictions on the investment fund's activity.

(1) Investment fund is not entitled to:

a) conduct transactions of selling and purchasing of the securities which are not owned by the fund;

b) contract credits and loans, including by pledging its assets;

c) issue bails and quarantees of ensuring the execution of other person's bonds;

d) conclude contracts with the manager, depository, registrar, auditor of the fund, fund council members or persons affiliated to them, other than those stipulated by this Law.
 
 

CHAPTER VI

FUND'S MANAGER.

Article 17. Fund's manager activity.

(1) Manager shall administrate the fund investments within the limits stipulated by law, declaration of fund investment, regulations on placement and repurchase of the shares of mutual fund or fund on intervals, prospectus of the fund shares issue and the provisions of the contract on the trust administration of fund investments.

(2) While making deals and reforming other juridical acts, related to management of fund's investments, the manager operates in his own name indicating the title of the fund of which investments he is administrating.

(3) The manager of the fund is bound to:

a) manage fund's investments only in fund's interests;

b) maintain bookkeeping and prepare reports on the activity of the fund draw up the separate accounting of his own activity in case this Law or the contract on trust administration of fund investments attributes this function to him;

c) exercise other duties, pursuant to the legislative acts, stipulated in paragraph (1).

(4) The manager of several investment funds is bound to accomplish the separate accounting and draw up the reports on each fund's activity.

(5) At the request of the investment fund, its depository, registrar, auditor, the manager of the fund shall submit them documents, related to the trust administration of the fund's investments.

(6) The representative of the fund's manager is entitled to attend general meetings of fund shareholders and fund council meetings and to take part in the discussion of the agenda items.

(7) Other rights and duties of the fund's manager are determined by the Civil Law, this Law, by regulations on fund's manager and by agreement on trust administration of fund's investments.
 
 

Article 18. Restrictions on fund's manager activity.

(1) An affiliated person of the fund, depository registrar, fund's auditor, and fund council member may not be the manager of the fund.

(2) The manager is entitled to conclude with the investment fund only the contract on trust administration.

(3) The fund's manager may not:

a) have any rights to depository's registrar's, fund's auditor or their managing affiliated persons' property, or fund council affiliated persons' property. Manager has no rights over the property of the broker who concludes deals on fund's securities in conformity to the contract with the manager.

b) conclude any agreements with depository, registrar, auditor of the fund, fund council's members or their affiliated persons, except the agreements pursuant to the present Law.

(4) The manager of the fund is entitled to conclude deals of fund's property alienation to its affiliated persons or the deals of funds'acquisition of these persons property only in accordance with fund's council approval and with the main conditions of such deals, being confirmed by the fund council.

(5) The summary balanced value of the fund's assets of which investments are operated by one manager, can not exceed 35% of the summary balanced value assets of all investment funds in the country.

(6) The observance by fund's manager of the provisions, stipulated in paragraph (1) Article 17, is controlled by the general meeting of shareholders, fund's council, depository, registrar and fund's auditor.
 
 

Article 19. Responsibility of fund's manager and his officials.

(1) The manager of the fund, pursuant to the legislation and to the agreement of trust management of fund's investments, bears the responsibility for damages incurred by him to investment fund due to violation of the legislative act's provisions, stipulated in paragraph (1) Article 17.

(2) Refund of damages, stipulated in paragraph (1), is conducted at the expense of the fund's manager own property.

(3) The officials of the fund's manager, pursuant to the legislation, shall bear the responsibility for the damage, caused by them to the fund or/and to the fund's manager, due to illegitimate actions (inaction) in managing of the fund's investments.
 
 

Article 20. Basic principles of the agreement on trust management of the fund's investments.

(1) Basic clauses of the agreement of confidential management of the fund's investments, which are to be confirmed by the general meeting of shareholders of the fund or by fund council, shall include:

a) the list and the value of the securities (share) passed to the trust management;

b) the obligation of the fund's manager to operate the fund's investment exclusively in fund's interests;

c) the obligation of the fund's manager to operate the fund's investments within the limits stipulated in paragraph (1) Article 17;

d) the amount and the form of the reward paid to the manager of the fund;

e) the period of agreement's validity.

(2) After the dissolution of the agreement on trust management of the fund's investments, the right of the management of the fund's investments shall pass to the other manager in accordance with this Law.



CHAPTER VII.

DEPOSITORY AND REGISTRAR OF THE FUND

Article 21. Activity of the fund's depository.

(1) The fund's depository shall provide the services to the investment fund in compliance with legislation, fund investment's declaration, rules of placement and repurchase of the shares of the mutual fund or interval fund and by the agreement on the depository service.

(2) The fund's depositor is bound:

a) to keep the certificates of the securities, belonging to the fund;

b) to carry out the admission and transmission of the securities belonging to the fund, on the basis of written instructions of the fund's manager and fulfil other functions of the nominal owner of the given securities (shares);

c) to accomplish the analitical accounting of the securities (share) belonging to the fund;

d) to fulfil other obligations, stipulated by legislative acts, specified in paragraph (1).

(3) The dipository of several investment funds is bound to carry out the independent analitical accounting of the securuties (share) belonging to each fund, in compliance with legislation on securities.

(4) At the request of the investment fund, of the fund's manager or auditor, the fund's depository shall submit them the, documents concerning the fund's depository service.

(5) Representative of the fund's depository is entitled to attend general meetings of fund shareholders and fund council meetings and to the part in the discussion of the agenda items.

(6) Other rights and responsibilities of the fund's depository are determined by the Civil Law, this Law, regulations of the fund's depository and agreement on the depository service.
 
 

Article 22. Restrictions on the fund depository's activity.

(1) Affiliated persons of the fund, managers, auditors of the fund or of fund council member can not be the depositor of the fund.

(2) Only when a bank is fund's depository, the depository is entitled to conclude a contract on the bank account for keeping and using fund resources, with fund manager or non-mutual fund which is conducting book keeping on its own.

(3) The fund's depository may not:

a) hold any rights over the property of the fund, manager, auditor or their managing affiliated persons or managing affiliated persons of the fund council members;

b) conclude with the fund, manager, fund's auditor, fund council members or their affiliated persons any agreements, except the agreements stipulated by this Law.

c) merge the securities (share) belonging to a investment fund with the securities (share) belonging to other investment fund or with other property of the depository which is in its nominal possession.

d) execute the instructions of the fund's manager which run counter to the requirements of the legislative acts, stipulated in paragraph (1) Article 21.

(4) By detecting the violation by the fund's manager of the legislative acts requirements stipulated in paragraph (1) Article 21, the fund's depositor is bound to notify this in written form immediately the investment fund, fund's manager and the NSC.
 
 

Article 23. Securities in the nominal possession of the depository.

(1) In case depositor is found guilty of not observing his responsibilities, securities (shares of participating) belonging to investment fund and in the nominal possession of the depository, may not persecuted.

(2) If the fund depositor is declared bankrupt, the securities (share) belonging to the investment fund and in the nominal possesion of the depository, can not be included to the competitive mass of the dipository under liquidation.
 
 

Article 24. Activity of the fund's registrar.

(1) The registrar of the fund keeps the register of the investment fund's shareholders in compliance with Law on Joint-Stock Companies, Law on Securities, rules of the placement and repurchase of the mutual, and interval fund's shares and by agreement of keeping of the shareholder's registrer.

(2) An affiliated person of the fund, manager, fund's auditor, or fund council's member may not be the fund's registrar.



CHAPTER VIII

FUND AUDITOR

Article 25. Activity of the fund auditor.

(1) The fund auditor conducts obligatory and ad-hoe inspections of the financial-investment activity of the investment fund, in compliance with Law on audit activity, Law on Joint-Stock Companies, this Law, Law on Securities, and agreement on the auditor's control.

(2) The annual results of the investment fund's activity are subjected to the auditor's checking.

(3) Upon checking the investment fund's annual activity the fund auditor is bound to check and confirm via a notification:

a) the financial accounting of the fund;

b) the acts of the analitical accounting on securities (share), belonging to the fund and in the nominal possession of the depository;

c) the calculations of the net assets value of the fund, the prices of the placement and refunding of the fund's shares and the amount of the reward paid to the manager, depository and fund registrar;

d) the specialized reports of the fund;

e) the draft of the published accounting of the fund;

f) other accounting acts, stipulated by legislation or by agreement on auditor's control.

(4) Upon detecting violation of the legislative acts requirements, statute's provisions, fund regulations, prospectus of the fund share issue, or of the clauses of the contracts conducted by the fund with manager, depository or registrar, the auditor is bound to immediately notify this to in written form the investment fund, fund manager and the National Securities Commission.
 
 

Article 26. Restrictions on fund auditor activity.

(1) The affiliated person of the fund, manager, depository, registar or fund council member may not be the auditor of the fund.

(2) The fund auditor may not:

a) have any rights on the property of the fund, manager, depository, fund registrar or their managing affiliated persons or fund council member's managing affiliated persons;

b) conclude with the fund, manager, depository, fund registrar fund council members or their affiliated persons, agreements other than those stipulated by this Law.
 
 

CHAPTER IX

ACCOUNTING, REPORTING AND INFORMATION REVEALING.

Article 27. Accounting and reporting system.

(1) In a manner consistent with the provisions of the Law on Accounting, this Law, the Law on Securities and other legislative acts, mutual funds and funds on intervals shall manage their accounting, prepare financial, statistical and specialised reports on the basis of agreement, whereas the non-mutual funds shall do this independently or on the basis of agreement as well.

(2) Specialized accounting of the investment fund shall include:

a) report on the share's movement placed by the fund;

b) report on the fund investments in securities of each issuer;

c) report on the total value and fund investment structure;

d) report on the value's changes of net fund assets;

e) report on the incomes and expenses of the fund;

f) report on the fund investments financial efficiency;

g) the fund council membrs list indicating the numbers and shares of the fund shares;

h) the list of the persons affiliated to fund, manager, depository, registrar and fund auditor, fund council members, containing the information on the observance by the mentioned affiliated persons of the restrictions stipulated by this Law;

i) information on events that had or might have a considerable impact on the fund's activity;

j) other information, stipulated by Legislation on Securities.

(3) The contents of the specialised reports of the investment fund, their form and the terms of their presentation, are determined by the legislation on securities.
 
 

Article 28. Revealing of information.

(1) In addition to documents mentioned in Article 92 of the Law on Joint-Stock Companies, creditors and shareholders of the investment fund will have access to contracts concluded with fund's depository.

(2) Persons mentioned in paregraph h) paragraph (2) Article 27 in compliance with Law on Securities, shall present the information on the observance (nonobservance) by them, of the restrictions stipulated by this Law.

(3) Investment Fund is bound to publish quartely the financial and specialised report on its activity.

(4) Contents and terms of publishing financial and specialized report of the investment fund are stipulated by Law on Securities.
 
 

CHAPTER X

INVESTMENT FUND REORGANIZATION.
FINAL AND TRANSITORY PROVISIONS.

Article 29. Restrictions on the investment fund reorganization.

(1) Only investment funds may participate in reorganization of fund investments via merger (association).

(2) Upon investment fund reorganization via division split only investment funds can be created.

(3) Investment fund is not entitled to change its legal organizational form.
 
 

Article 30. Joint-Stock Companies with the features of investment fund activity.

(1) Joint-Stock Companies with certain features of investment fund activity, but which does not have the appropriate NSC license or NSC decision that such activity is not the investment fund activity, is bound to stop or hold up its activity until it receives the NSC decision or the NSC license, if:

a) the company activity has the features, stipulated in paragraphs a) and b) paragraph (1) Article 2; and

b) in the company general assets the securities share of other issuers constitutes 35% and more during one quartal of the financial year.

(2) Failure of joint-stock company with certain features of investment fund activity, to observe paragraph (1) requirements, may serve as a base for stopping the activity of this company in confirmity with paragraph c) paragraph (2) Article 32 of Law on Enterprenionship and Enterprises.

(3) This article provisions are not applicable to joint-stock companies mentioned in paragraph (3) Article 2.
 
 

Article 31. Mode and terms of reorganisation of investment funds to be subjected to privatisation.

(1) Investment funds to be subjected to privatisation are bound to reorganize into mutual, interval and non-mutual funds, in the order, established by the Government, until July 1, 1998.

(2) In view of reorganization, until January 1, 1998, investment funds which are to be privatised are bound to:

a) ensure that their agreements with depositories, registrars and auditors are in accordance with this Law;

b) present to NSC the reorganization declarations, confirmed by funds councils in accordance with the general meetings of shareholders' decisions;

c) conclude agreements with managers-legal persons. Until concluding these agreements the fund manager's responsibilities are exerted by physical persons on the basis of labour contracts.

(3) Until the reorganisation investment funds for privatisation shall conclude selling transactions acts and securities exchange of the other issuers, as well as transactions of purchase of the shares placed by funds, through the Stock Exchange only.

(4) Upon registration of increase of social capital of investment funds for privatisation as a result of the completion of issue of their own shares, after the accomplishment of privatisation on the basis of national patrimony bonds, the stamp tax is not collected.
 
 

Article 32. Putting this Law into force.

(1) This Law shall enter into force on the date of its publication.

(2) Before confirming the legislative acts which are in force on the territory of the Republic of Moldova, to the provisions of this Law, these legislative acts shall be applied after this Law's entering into force in a manner not contradictory to this Law.

(3) Investment funds for privatisation which wuold not respect the provisions of Article 31, paragraph (1), shall be liquidated on the basis of the decision of the general meeting of shareholders or the decision of the judiciary body.

(4) The Government shall, before September 1, 1997:

(a) submit to the Parliament the proposals on conforming the legislation to this Law;

(b) ensure that its normative acts are in conformity with this Law;

(c) adopt normative acts which wuold ensure the implementation of the provisions of this Law.

(5) It is advised to the President of the Republic of Moldova to abrogate the provisional Regulations on investment funds, approved by the Decree N.50 from February 18, 1994 on the creation of privatisation infrastructure.




Speaker of the Parliament    Dumitru Diacov

Hotariri