Exempt Schemes (as defined in Schedule 3 to the CIS Act) are unregulated 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 unregulated 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.
The Regulated Activities Order 2011 and the Financial Services (Exemption) Regulations 2011 permit functionaries (managers, administrators, trustees, fiduciary custodians or custodians) acting for no more than one exempt or exempt-type scheme to be excluded or exempted from the requirement to be licensed under Class 3 'Services to Collective Investment Schemes' of the Regulated Activities Order 2011.
- Exclusion under the Regulated Activities Order 2011 - A functionary is not conducting a regulated activity if it only acts for one exempt or exempt-type scheme and there is no-one in its economic group acting in the same capacity for an exempt or exempt-type scheme
- Exemption under the Financial Services (Exemption) Regulations 2011 ("Exemption Regulations") - There is an exemption from licensing where the person only provides services to one exempt/ exempt-type scheme and it has an agreement with a Class 3(12) licenceholder3 which requires the exempt person to provide sufficient information about the scheme and itself to the Class 3(12) licenceholder to enable them to assess whether the exempt person is only acting for 1 scheme and whether the scheme meets the requirements to be an exempt / exempt-type scheme.
The Authority has issued a guidance note to help limited partnerships and their advisers establish whether a limited partnership is a scheme under the Collective Investment Schemes Act 2008. This guidance also outlines the process for Corporate Service Providers looking to request an extension to their financial services licence to provide services to exempt or exempt-type scheme.
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.