Update For All Regulated Mutual Funds - Segregation Of Assets

In exercise of its authority under the Monetary Authority Law (as amended) (the "Monetary Authority Law"), the Cayman Islands Monetary Authority ("CIMA") has published a Rule on the segregation of assets (the "Rule"). All funds regulated or licensed under the Mutual Funds Law (as amended) (the "Mutual Funds Law")¹ are obliged to appoint a service provider with regard to ensuring the safekeeping of the fund's assets.² The primary intention of the Rule reinforces standard industry practice by reiterating that no operator (director/general partner/trustee), investment manager, administrator, custodian or other service provider to a mutual fund (the "Service Provider") is able to use the portfolio investments or investor funds of the fund to finance its own or any other operations in any way. In most cases, we do not expect that funds will need to make significant changes to their existing arrangements.