Qualified investor schemes (QIS)
Produced in partnership with Lora Froud of Macfarlanes

The following Financial Services practice note produced in partnership with Lora Froud of Macfarlanes provides comprehensive and up to date legal information covering:

  • Qualified investor schemes (QIS)
  • Investment and borrowing powers
  • Who can invest in a QIS?
  • Other considerations
  • Genuine diversity of ownership

Qualified investor schemes (QIS)

BREXIT: 11pm (GMT) on 31 December 2020 (‘IP completion day’) marked the end of the Brexit transition/implementation period entered into following the UK’s withdrawal from the EU. Following IP completion day, key transitional arrangements come to an end and significant changes begin to take effect across the UK’s legal regime. This document contains guidance on subjects impacted by these changes. Before continuing your research, see: Brexit and financial services: materials on the post-Brexit UK/EU regulatory regime.

Alongside undertakings for collective investment in transferable securities (UCITS) and non-UCITS retail schemes (NURS), the UK regime provides for a third category of regulated collective investment scheme (CIS): the qualified investor scheme (QIS).

The QIS regime was introduced as a result of demand from the fund management industry for a Financial Conduct Authority (FCA) regulated investment vehicle with a relatively light regulatory framework, for use primarily by professional, institutional and sophisticated investors, such as those in the wealth management area.

The QIS regime is set out in chapter 8 of the FCA Handbook's CIS sourcebook, known as COLL. It has two key characteristics:

  1. few detailed limitations on the investment powers of a QIS, and

  2. restrictions on the persons to whom a QIS can be marketed.

Investment and borrowing powers

A QIS can:

  1. invest in transferable securities, deposits, derivatives, money market instruments, other CIS, gold and other precious metals, immovables (i.e. land and/or

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