Exempt Schemes (as defined in Schedule 3 to the CIS Act) are schemes which
- are private arrangements,
- can have up to 50 investors and
- whose constitutional documents must expressly prohibit the making of an invitation to the public to subscribe in any part of the world.
Exempt-type schemes are schemes established outside the IOM that are equivalent to the IOM Exempt Scheme.
For legislation or published guidance notes applicable to exempt funds please click on the appropriate tabs at the left of this page.
For forms applicable to exempt funds (statistical and pricing error forms) please click on the forms page found under the Regulated Entities tab on the banner above.
There are no notification requirements in respect of new and ceased exempt schemes and exempt-type schemes and the Isle of Man Financial Services Authority ('the Authority') does not hold information on these schemes, except for statistical and pricing error information which should be reported via the Authority's online portal (https://www.fscreturns.co.im) on a quarterly basis.
Functionaries (such as managers, administrators, trustees, fiduciary custodians or custodians) that provide services in or from the Isle of Man to Exempt or Exempt-type schemes are required to be licensed under the Financial Services Act 2008 (“FSA08”) to conduct Class 3(11) regulated activity set out within the Regulated Activities Order 2011, unless the activity falls under an exemption.
A Class 3(12) permission is required to provide administration services to a person who is undertaking Class 3(11) regulated activity but who is exempt from licensing by virtue of paragraphs 3.2 or 3.6 of the Financial Services (Exemptions) Regulations 2011.
The exemption from licensing at 3.2 of the Exemption Regulations in relation to regulated activity falling within Class 3(11) of the Regulated Activities Order 2011 is very narrow. It applies if a person only provides services to one Exempt or Exempt-type Scheme and satisfies the specified conditions. There are other exemptions under 3.6 of the Exemption Regulations available for functionaries of Exempt or Exempt-type schemes which are wholly-owned subsidiaries of licenceholders; full details can be found in the Financial Services (Exemptions) Regulations 2011.
The Authority has issued a guidance note to provide further information on exempt schemes.
Please note that whilst exempt schemes are not directly subject to regulation the Authority may exercise its powers of intervention in certain circumstances. Please refer to Part 5 of the Collective Investment Schemes Act 2008 for further information.