Consultation Paper on Proposals for Non Guernsey Schemes

Closed 27 Jan 2021

Opened 8 Dec 2020


Purpose of the Consultation

The Commission seeks to regulate and supervise financial services in the Bailiwick of Guernsey, with integrity, proportionality and professional excellence, and in so doing help to uphold the international reputation of the Bailiwick of Guernsey as a finance centre.

Consistent with the Commission’s objectives, the proposals in this Consultation are designed to ensure that the rules framework under The Protection of Investors (Bailiwick of Guernsey) Law, 1987 (“PoI”) remains fit for purpose; introduces efficiencies in the current framework and seeks to clarify current areas of uncertainty and duplication. These changes will ensure that investors and the reputation of the Bailiwick continue to be protected while also helping to create opportunities for further growth.

The purpose of this Consultation is to seek feedback from all interested parties on detailed proposals for changes to the Commission’s Non-Guernsey Scheme regime.

The publication of this Consultation follows the Commission’s review and consideration of feedback received on the Funds Growth Discussion Paper issued in July 2020[1]. A high level summary of this feedback is provided in Part 1 of this paper and additional discussion on specific elements is provided in Part 2.

This Consultation is a working document and does not prejudge any final decision to be made by the Commission.

Why we are consulting


Background to the proposals

A Non-Guernsey Scheme is a collective investment scheme[2] that is not established or incorporated in the Bailiwick of Guernsey and is not authorised or registered by the Commission. The Law permits PoI licensees to act for Non-Guernsey Schemes if they are authorised in Jersey, Isle of Man, United Kingdom or Ireland without prior approval[3]. Licensees acting for Non-Guernsey Schemes established in any other territory are subject to the requirements of the Licensees (Conduct of Business and Notification)(Non-Guernsey Schemes) Rules 1994 (“the Non-Guernsey Scheme Rules”). For the purposes of this consultation we refer to schemes within scope of notification under the Non-Guernsey Scheme Rules as “Relevant Schemes”.

The Non-Guernsey Scheme Rules are currently only applied in practice to restricted activities carried out in connection with open-ended schemes. 

As at the date of writing 66 approvals have been issued to PoI licensees acting for Relevant Schemes with a total net asset value of £37 billion. By way of comparison, the total net asset value of Guernsey domiciled open ended funds is £48 billion. 

In its July Discussion Paper the Commission proposed that the Non-Guernsey Scheme Rules be amended to remove the requirement for prior Commission approval in respect of the commencement of restricted activities in respect of a Relevant Scheme. The requirement to provide notification under the Non-Guernsey Scheme Rules was proposed to be retained and the Non-Guernsey Scheme Rules amended to remove any duplication with the Licensees (Conduct of Business) Rules 2016 (“the CoB Rules”).

We considered the responses to the Discussion Paper carefully and with an open mind. Responses were supportive of the proposals but also included suggestions for further reform including that the Non-Guernsey Scheme Rules be removed in their entirety. We also undertook further analysis of the risks posed by the regime. Based on this due consideration and analysis this paper sets out further proposals to remove both the approval and notification requirements, along with associated fees, and to replace them with an annual data submission.

Part 1 – Feedback to the Discussion Paper

The Funds Growth Discussion Paper included high-level proposals to revise the regulatory framework for PoI licensees acting for Relevant Schemes.

Responses were received to the Discussion Paper from trade associations, the public and a cross-section of industry. Of the seventeen respondents, twelve agreed with the proposal to amend the Non-Guernsey Scheme Rules to remove the requirement for prior approval in respect of the commencement of restricted activities in respect of a Relevant Scheme and the remaining five had no view on the proposal (the focus of these responses was on other elements of the Discussion Paper). Two of the responses received also indicated that the Commission should consider more far reaching reform including removing the Non-Guernsey Scheme Rules altogether. Given the support for significant revision of the regime this paper sets out proposed changes for further consideration.

The Discussion Paper made a number of different proposals in addition to those relating to the Non-Guernsey Scheme Rules. Each of these proposals will be addressed in separate consultations, based on appropriate timetables[4].

The Commission would like to thank everyone who responded to the Discussion Paper.

Financial Crime

The proposals in this consultation and any potential outcomes do not impact on a PoI licensee’s obligations under Schedule 3 to the Criminal Justice (Proceeds of Crime) Law or the Handbook on Countering Financial Crime and Terrorist Financing to apply the relevant provisions in Schedule 3 and the rules in the Handbook to business relationships the PoI licensee has with open ended and closed ended Non-Guernsey Schemes.  No changes are envisaged to section 7.12.3 of the Handbook which contains rules and guidance on how those provisions apply to these relationships.


[1]  Discussion Paper – Funds Growth Omnibus, 7 July 2020

[2] As defined in Schedule 1 of the PoI Law

[3] Non-Guernsey Schemes that are exempt by virtue of establishment in a Designated Country or Territory as prescribed in the Investor Protection (Designated Countries and Territories) Regulations 1989 and 1992

[4]  A Consultation Paper on Proposals for Private Investment Funds is to be published in December 2020.


What happens next

Next Steps

The closing date for the Consultation is 27 January 2021. Responses to this Consultation will be considered by the Commission with a view to revoking the Non-Guernsey Scheme Rules and introducing amended data collection requirements in 2021.


  • Consumer
  • Financial Services Business