Published 2000

i) UCITS

A foreign UCITS fund, the units of which are to be offered in Greece, must register with the Capital Market Commission (‘CMC’). To this effect, the following documents must be submitted (Article 49b law 1969/1991):

(a) A certificate from the competent authority of the Home State certifying that the fund complies with the criteria of the UCITS_Directive;

(b) the rules of the UCITS or the constitutional documents in the case of a company;

(c) the prospectus;

(d) the latest annual and half-year report;

(e) details of the method to be used to market the fund in Greece.

The distribution and advertisement of the UCITS may begin two months after the date of submission to the CMC of the above documents, unless the CMC decides, with a reasoned opinion, that the method of marketing is not compatible with rules applicable in Greece. The UCITS must publish in Greek all documents and information that it must publish in its home country. Furthermore, it must comply with Greek rules on advertising of funds (the most significant of which being to include in all publicity the phrase ‘funds have no guaranteed return and past performance is no guarantee for the future’) and it must ensure the method of payment to Greek investors, and the distribution in Greece of ongoing information, as required by the UCITS Directive. According to rules on the advertising of funds, any announcement must be submitted in advance to the CMC. If so requested by the CMC, a fund must publish corrective announcements. A special regulation issued by the CMC also sets forth the acceptable methods for making computations of the return on the fund and corresponding comparisons.

As the law makes no distinction between public and private offerings of fund units, all the above must be followed even in case of an intended private offer. However, in practice the CMC may be open to a de minimis argument, so as not to raise any issue in case of a (private) offer, made to a restricted circle of people.

Marketing by third parties

Banks, insurance companies and investment firms may market and sell units in funds. Under the Code of Conduct for Mutual Funds and Investment Companies funds are responsible in that they are liable for the method of distribution, for the election of representatives and for their actions, and for the distribution of their units/shares. There is an obligation to have a written contract with the representative acting as distributor for the fund.

ii) funds of non-UCITS type

Such funds are subject to the limitation imposed by art. 115 of law 2533/1997, according to which distribution in Greece of units of non-UCITS collective investment schemes based in EU member countries and of any such schemes based in non-EU countries is conditional upon a prior permission being granted by the CMC.

Decision of the CMC nr. 129/14.4.98 provides the framework for the application procedure that any such fund must follow in order to be allowed to be marketed in Greece. The fund needs to submit the following documents:

• Confirmation of the relevant regulatory authority of the state where the fund is based, that it complies with all rules and conditions set by them;

• Regulation and/or the constitutional documents of the fund, e.g. Articles of Association, if applicable;

• Prospectus;

• The latest annual and the six-month report;

• Information concerning the method of marketing of the fund in Greece and the method of making payments to investors;

• The agreement between the fund and its representative in Greece. If the representation is an insurance or investment firm, the name of the cooperating bank and method of depositing funds should also be given;

• Information concerning the advertising materials that are going to be used to attract investors.

The CMC is theoretically entitled to also request information about the legislative framework for the operation of the fund in its country of origin. However, this is not likely in the event of a fund from an EU jurisdiction and normally applies only in relation to funds based in tax heavens and other less-known jurisdictions.

Marketing may begin only following publication of the approval of the CMC in the Government Gazette. Furthermore, the fund should submit to the CMC any publication through which the public is called to invest or the fund is directly or indirectly advertised, as well as any changes in the regulation or its constitutional documents. To be noted, all information published obligatorily in the country of origin must also be published, translated in Greek.

As regards marketing, and besides all the above, obligations deriving from the Code of Conduct of Investment Firms, are also applicable. These include a prohibition of cold-calling (unless the customer has consented to it) and the obligation to provide to investors adequate information as to the nature of the investment.