of December 30, 2010 No. ZR-245
About investment funds
Accepted by National Assembly of the Republic of Armenia on December 22, 2010
The purpose of this Law is protection of the rights of investors, development of collective investment system and establishment of single rules of creation and activities of investment funds and managing directors of investment funds, increase in financial intermediation and attraction of general population on the security market.
1. This Law governs the relations connected with collective investments and establishes (regulates):
1) types of the investment funds operating in the territory of the Republic of Armenia and their legal status, and also legal status of managing directors of the investment fund operating in the territory of the Republic of Armenia, persons exercising control of non-public fund of the branches of managing directors of foreign investment fund created in the territory of the Republic of Armenia and depositaries of investment fund;
2) the relations connected with creation, activities, management and the termination of activities of branches of the investment funds managing investment funds, persons managing non-public funds and the managing directors of foreign investment funds acting in the territory of the Republic of Armenia;
3) requirements to investment policy of the investment funds operating in the territory of the Republic of Armenia;
4) security sale of foreign investment fund in the territory of the Republic of Armenia;
5) the relations arising in connection with implementation by the Central bank of the Republic of Armenia (further – the Central bank) control over the implementation and observance of the requirements of this Law adopted on its basis of other legal acts and application of measures of responsibility for violation of these requirements by it.
2. The provisions established by this Law for investment funds belong to public investment funds, all types of funds of securitization if in contents of the specific precept of law it is directly not specified that they treat non-public investment funds or if other is not established by part 4 of article 8 of this Law.
3. Features of securitization of securities and the pension funds are established by the relevant laws.
4. Additional requirements to activities of managing investment fund as the member of financial group are established by the Law of the Republic of Armenia "About the Central bank of the Republic of Armenia".
1. The relations connected with forming and activities of investment funds (including non-public investment funds) managing directors of investment funds and persons exercising control of non-state funds are regulated by this Law (taking into account the provisions established by part 2 of article 1 of this Law), the Civil code of the Republic of Armenia, and also the laws of the Republic of Armenia "About the security market", "About joint-stock companies", "About limited liability companies" and other laws and regulatory legal acts if this Law does not provide other regulation.
1. In this Law the following basic concepts are used:
1) investment fund (further also - fund) - the legal entity or the set of assets formed based on the agreements of management of fund provided by the Civil code of the Republic of Armenia which is created acts or is used for the purpose of attraction of financial resources of investors and implementation of collective investments in securities or other assets according to single investment policy.
The legal entity or group of assets corresponding to these criteria are considered as investment fund irrespective of whether it is determined in its constituent documents or documents of the offer as "investment fund" or not and also irrespective of whether there was effective objective or activities it is actually performed by this legal entity (person managing group of assets) or not.
By regulatory legal act of the Central bank criteria for evaluation of the activities provided by this Item as the purposes of creation or activities of person (set of assets) can be established. At the same time "fund" do not join in concept:
and. bank, insurance company, investment company, managing director of investment fund, credit institution,
. the fund guaranteeing compensation of deposits, created according to the procedure, the Guarantee fund created on the basis of the Law of the Republic of Armenia "About the compulsory liability insurance following from use of vehicles" and also the Guarantee fund provided by the Law of the Republic of Armenia "About funded pensions" established by the Law of the Republic of Armenia "About guaranteeing compensation of bank deposits of physical persons".
the century of the organization performing investments within the programs performed by the state or based on international treaties
group, holding or other similar person which main activities is production of goods or rendering services (but not real estate investments) and investment into securities which it is caused mainly by the purpose of predetermination of decisions of governing bodies of issuers or significant effect on them. The criteria disaggregating the provisions established by this subitem can be established by regulatory legal act of the Central bank;
2) public fund – the fund which is not considered as non-public fund;
3) non-public fund – fund which issued securities according to the charter (rules) cannot be placed by means of public offer, including the offer sent to exclusively uncertain number of skilled investors;
4) type of fund – the specific type of fund for investment policy or the mechanism of release and the redemption of shares (shares) of fund provided by this Law;
5) standard fund type of fund which assets (in case of availability of subfunds - all its subfunds) can be invested for 90 percent at least only in the assets specified in Items 1, 9 parts 1 of article 40 of this Law;
6) specialized fund – real estate fund, fund with additional risk (hedge fund), sekyyuritizatsionny fund, fund of funds, fund of private equity (the fund prayvit ekvit), including venture fund, and also other type of fund which assets completely or in certain minimum size, but at least in the amount of 30 percent are subject to investment into specific asset types, part 1 of article 40 of this Law which is not specified in Items 1-9;
7) ceased to be valid according to the Law of the Republic of Armenia of 01.02.2025 No. ZR-23
8) contractual fund - set of the assets created based on the agreements of management of contractual investment fund provided by the Civil code of the Republic of Armenia;
9) corporate fund – fund with the status of the legal entity which assets are attracted by means of share placing or other equity securities (further – shares);
10) joint-stock company with the variable capital – joint-stock company which has no the fixed capital and which capital is at any time equivalent net assets values of fund;
11) joint-stock company with the steady capital – the joint-stock company which is not joint-stock company with the variable capital;
12) open-end fund – type of fund which shall in any working day upon the demand of each of his participants redeem the shares (shares) issued by fund belonging to this participant in the procedure established by this Law;
13) interval fund – type of fund which does not redeem the securities issued by it on regular basis, but which shall in the presence of the requirement of each of his participants redeem in the procedure established by this Law the securities issued by fund belonging to this participant in the interval terms established by its rules (charter);
14) the closed fund – type of fund which has no obligation upon the demand of his participant to redeem belonging to it shares (shares), issued by fund, the cases except for provided by this Law;
14. 1) exchange investment fund - standard investment fund which shares (shares) are admitted to trading in the controlled market and issue placement and repayment (redemption) of shares (shares) of which are performed according to the procedure, established by its rules (charters), according to article 42.1 of this Law;
15) subfund – the set of the assets isolated as a part of the same fund having single rules of activities and different from other set of assets of fund of its investment policy or income distribution policy, or payment for placement (redemption) of shares of fund, either currencies of its assets, or remuneration of the managing director, or their combinations;
16) share of fund – the nominal investment security issued by contractual fund certifying the right of its owner to equity in assets of this fund (further – share);
17) asset of fund – the money of fund raised by means of placement of shares (shares), resolved by this Law assets in which the raised money and income gained thanks to management, and also other means provided by the law are invested;
18) negotiable asset – money or other asset, the address in which money perhaps for short period without essential losses for their owner;
19) net assets value of fund – difference between total market value of the assets of fund and cost taken by fund (for the asset account of contractual fund - to the managing director) obligations in the cases and procedure established by this Law and rules (charter) of fund;
20) estimated cost of share (share) – the cost equal to the relation of net assets value of fund (subfund) and total quantity of the placed and not redeemed shares (shares) of this fund (subfund);
21) the member of fund - the owner of shares (shares) issued by fund according to this law. In sense of this law shares (shares) include also shares in the authorized capital of the partnership based on trust management;
22) the managing director of fund – person who obtained the license in the procedure established by this Law who exercises control of the fund created according to this Law (further – the managing director);
23) depositary of fund – person rendering service in storage of assets of fund who according to the procedure, established by this Law and other laws, and based on the agreement signed with fund (his managing director) accepts to storage stores and considers assets of fund, services the transactions connected with asset management of fund and transfers assets on their basis, and also within the competence controls activities of the managing director of this fund for the benefit of members of fund (further – depositary);
24) the agent of fund – person performing sale and (or) the redemption (repayment) of shares or shares based on the agreement signed with the managing director (further – the agent);
25) fund of skilled investors – standard or specialized fund which issued shares (shares) according to the law or its rules (charter) can be offered only:
and. to skilled investors and (or)
. to investors, the purchase price of the share (share) acquired by each of which (in case of each separate offer - total cost of acquired shares / shares/) exceeds the size established by regulatory legal acts of the Central bank;
26) index fund – type of standard fund which purpose of investment policy is duplication of structure of index of certain shares or bills of exchange;
27) the pension fund - fund which assets are created at the expense of compulsory accumulative contributions (the obligatory pension fund) or voluntary accumulative payments (the Voluntary pension fund) and their investments made from the government budget of the Republic of Armenia without fail according to the Law of the Republic of Armenia "About funded pensions" and of which payments to participants from assets of fund are made (the money corresponding to share of the participant in assets of fund returns) in the form of pension on reaching the participant of retirement age, and also in other cases provided by the Law of the Republic of Armenia "About funded pensions";
28) person exercising control of non-public fund - the legal entity who got in the procedure established by this law permission to management of non-public fund which exercises control of the non-public fund created according to this Law.
2. Other concepts used in this Law are applied in the sense determined by the Civil code of the Republic of Armenia and the Law of the Republic of Armenia "About the security market" if other sense of their use does not follow from provisions of this Law.
1. The fund can be created and perform the activities provided by this Law only from the moment of registration of fund (its rules) by the Central bank according to the procedure, provided by this Law.
2. The fund can be created in the status of contractual or corporate fund.
3. The fund for investment policy can be standard or specialized.
4. According to the procedure of release and the redemption of shares (shares), the public fund can be open, closed or interval, and the non-public fund can be only closed or interval.
5. The obligatory pension fund can act only as open-end contractual fund. The pension fund cannot be the closed or interval fund.
6. The fund cannot perform the activities which are not provided for fund by this Law.
1. The funds created in the procedure established by this Law, having no right to use in the name such misleading words which can be the cause for doubts in the relation of financial position, legal status of fund or the activities performed by it.
2. The name of contractual fund shall contain the name of his managing director. The funds managed by the same managing director cannot have mixing of the name, identical or similar to degree. The name of non-public fund shall contain the words "non-public".
3. Use by persons who do not have the corresponding registration in the Central bank, phrases "pension fund" or "fund of securitization", their case forms, the Armenian transliteration of these words in foreign language, their transfers or their combinations, and also the names directly or indirectly characterizing activities of funds within business tradition in the name, advertizing, the public offer or other assistance to advertizing is forbidden if from sense of use of phrases "investment fund", "pension fund" or "fund of securitization", their derivatives or the specified names do not follow that this is not about activities of investment fund, pension fund and fund of the securitization established by this Law and (or) the Laws of the Republic of Armenia "About funded pensions" "About securitization of the assets and securities provided with assets" and if the right of such use was not taken away by the law or the international treaty.
1. The location - fund is location of his managing director (person exercising control of non-state fund), except for corporate fund which location is the legal address specified in its charter.
1. The fund can have the agent (agents).
2. Person rendering according to the Law of the Republic of Armenia "About the security market" investment services with whom the managing director signed the agreement of rendering services provided by part 3 of this Article can be the agent.
3. The agent performs sale and (or) the redemption (repayment) of shares or shares on behalf of fund (in case of contractual fund - on behalf of the managing director) and at the expense of fund by means of acceptance and transfer of the corresponding requests to the managing director and (or) acceptance, transfer and implementation of payments of money, specifying in case of contractual fund that he acts as the agent of this fund.
1. The non-public corporate fund cannot have form of business of open joint stock company.
2. Public placement of shares (shares) of non-public fund cannot be performed.
3. The non-public fund can have no more than 49 participants. In case of exceeding of number of participants about the 49th non-public fund it shall be re-registered within 90 calendar days as public fund in the general procedure established by this law or, respectively, reduce number of the participants. Otherwise it is subject to liquidation judicially.
4. Provisions of Articles 3-7, 10 and 11, of Article 12 (except for parts 5), Article 13 (except for parts 5), articles 16-18, of articles 20-23, of article 24 (except for parts 1, of Item 17), Articles 25, of parts 1, of 2, 5 and parts 6 (except for the second offer), Articles 26, of parts 1-3 and 7, of articles 27 and 28, of article 30 are applied to non-public funds (except for parts 3), Articles 31, parts 1 and 2, Article 32 (except for parts 5 and 6), Articles 34, Articles 40, article 45 of this Law. (except for parts 3), Article 46 (except for parts 2), Article 47 (except for parts 4), Articles 48, 49 and 51, Article 62. 1, Article 68, part 1, Item 1, Article 69, part of 1 Article 72, parts 3 and 4 of Article 92, part 4 Articles 95, Article 97, Article 99 (except for parts 11 and 12), Article 100 (except for parts 11 and 12), Article 101 (except for first offer of part 3, parts 4 and 10), Article 102 (except for parts 3, second offer of part 4, (parts 5 and 13) and provisions of Articles 103-113. At the same time the provisions established by this part in the part concerning depositary extend to non-public funds only in the presence of the requirement about availability of the separate depositary established by regulatory legal acts of the Central bank, and in the part concerning the managing director extend to person exercising control of non-public fund.
5. The charter of non-public corporate fund, in addition to the requirements established by the Civil code of the Republic of Armenia and the Law of the Republic of Armenia "About joint-stock companies" for charters of legal entities of this form of business shall contain also at least the mandatory provisions provided by the Civil code of the Republic of Armenia for rules of fund.
6. Central Bank the regulatory legal acts can establish requirements to non-public funds for maintaining the register of members of fund and storage of assets of fund.
7. The requirements established by part 6 of this Article can be differentiated depending on type of fund or net assets value of fund.
8. The cash account of non-public fund which is used for receipt of appropriate means from investors or payment of means to them in case of placement or repayment of securities of fund shall be open in the bank operating in the territory of the Republic of Armenia. The requirement established by this part does not extend to non-public funds which assets are delivered in trust management to the depositary operating in the territory of the Republic of Armenia.
1. It is forbidden to perform activities for management of non-public funds, to offer its implementation or to be represented by person performing it, without the permission issued by the Central bank according to the procedure, established by this Law and regulatory legal acts adopted on its basis. In the cases established by regulatory legal acts of the Central bank, the investment company has the right to perform activities for management of non-public funds without the permission provided by this part.
2. The permission or the rights provided by it cannot be pledged, transferred or are otherwise aloof.
3. Permission is issued is termless.
4. The single form of permission is established by regulatory legal acts of the Central bank.
5. Permission is issued and stops board decision of the Central bank. Permission is terminated only the bases and according to the procedure, the established this Law.
6. In case of loss of permission or its reduction in condition, unsuitable for use, person who got permission shall without delay, but no later than three working days, notify on it the Central bank. Central Bank in ten-day time from the date of receipt of the statement issues the copy of permission.
1. Permission to management of non-public fund can be issued only to the resident of the Republic of Armenia or legal nonresident person answering to the conditions established by regulatory legal acts of the Central bank.
2. For receipt of permission to management of non-public fund person submits to the Central bank of the data and documents provided by regulatory legal acts of the Central bank.
3. The board of the Central bank makes the decision on issue or on refusal in issue of permission to management of non-public fund within 30 days from the date of receipt of the statement.
4. The board of the Central bank makes the decision on refusal in issue of permission to management of non-public fund if:
1) the submitted documents do not correspond to this Law, regulatory legal acts adopted on its basis, or false documents are submitted, or false information is reflected in the submitted documents, or in the submitted documents there are shortcomings, and these defects are not eliminated by person submitting the petition, in time, specified regarding 1 article 111 of this Law;
2) person does not conform to requirements, the established this law and other legal acts for implementation of activities for management of non-public fund;
3) the head of person corresponds to any of the criteria established by part 1 of article 8.3 of this Law;
The considerable member of person satisfies 4) to any of the refusal bases in prior consent to acquisition of considerable participation established by the Law of the Republic of Armenia "About the security market";
5) within three years preceding date of filing of application on receipt of permission, action of permission of the Central bank to management issued to person it was suspended based on any of the bases established by Items 2-6 of part 1 of article 8.4 of this Law;
5. In case of decision making about issue of permission the Central bank within 10 working days from the moment of decision making transfers permission to person exercising control of non-public fund.
6. In case of change of the data specified in part 2 of this Article, person exercising control of non-public fund represents changes to the Central bank within 10 calendar days after change.
7. For the purposes of this Article the chairman and board members, the chief executive or the head and members of executive body are considered as managing. Person managing non-public fund shall inform the Central bank on any changes in structure of its management within 10 working days from the date of their origin.
1. Person who cannot be the head of person exercising control of the non-state fund established by part 7 of article 8.2 of this law:
1) it is recognized as incapacitated or it is limited capable in the procedure established by the law;
2) has the outstanding or not removed criminal record for the crime committed intentionally;
3) according to the court verdict which took legal effect it is deprived of the right to hold positions in financial, economic, legal spheres;
4) earlier, but not earlier than three years ago, it was deprived of the qualification provided by the Central bank.
2. Persons who satisfy at least to one of the refusal bases in prior consent to acquisition of considerable participation established by the Law of the Republic of Armenia "About the security market" cannot be the considerable member of person exercising control of non-public fund. Person who acquired considerable participation in the authorized capital of person exercising control of non-public fund or increased the participation in such a way that its participation in the authorized capital of person exercising control of non-public fund granting voting power is made at least 20, by 50 or 75 percent, shall report about it to the Central bank within 10 working days after acquisition of considerable participation or increase in participation. In case of acquisition of considerable participation with violation of the requirement provided by this part, the Central bank can offer person (and in case of failure to carry out of the offer - to demand from it judicially) that it in reasonable time alienated or otherwise stopped the equity participation of person exercising control of non-public fund.
3. For the purpose of protection of interests of investors the Central bank can establish the regulatory legal act the list and procedure for provision of the minimum information which is subject to obligatory disclosure and informing clients by persons exercising control of non-public fund.
4. Central Bank the regulatory legal acts can establish economic standard rates, the stipulated in Article 67 these laws, requirements to Board of Directors, internal audit, risk management concerning persons exercising control of non-public funds which cannot be more strict, than the requirements established by this Law to managing directors.
5. The requirements established by part 4 of this Article can differ depending on type of the funds managed by person exercising control of non-public fund, or net assets values.
6. Central Bank has the right the regulatory legal acts to permit persons exercising control of non-public fund, such types of additional activities which are closely connected with activities for management of fund if necessary establishing additional requirements for their implementation.
7. Persons exercising control of non-public funds are forbidden to be engaged in any other activities which are not connected with fund management.
1. Permission to management of non-public fund can be stopped:
1) if person exercising control of non-state fund did not perform activities for management of fund within 12 months in a row after receipt of permission;
If person exercising control of non-state fund published 2) or provided the misleading, unreliable information or forgery documents to the Central bank;
3) if person exercising control of non-state fund, or his heads allowed periodic (two and more) violations of requirements of this Law, other laws, the regulatory legal acts adopted on their basis;
If person exercising control of non-public fund did not observe 4) in the term established by the Central bank the instructions given by the Central bank according to this Law;
Disclaimer! This text was translated by AI translator and is not a valid juridical document. No warranty. No claim. More info
Database include more 50000 documents. You can find needed documents using search system. For effective work you can mix any on documents parameters: country, documents type, date range, teams or tags.
More about search system
If you cannot find the required document, or you do not know where to begin, go to Help section.
In this section, we’ve tried to describe in detail the features and capabilities of the system, as well as the most effective techniques for working with the database.
You also may open the section Frequently asked questions. This section provides answers to questions set by users.