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Finland

In July 2004, the Finnish Financial Supervision Authority (FSA) issued a statement on the interpretation of certain provisions of the Investment Funds Act on marketing of units in foreign investment funds in Finland.

The FSA has taken the view that UCITS funds are, by definition, always considered open to the public. Consequently, the Finnish private placement rules do not apply to the offering of units in non-Finnish UCITS funds in Finland. Any marketing of units in a non-Finnish UCITS fund in Finland is, therefore, subject to a notification being filed with the FSA, regardless of whether or not the marketing activities are limited to pre-selected professional investors only.

However, as regards marketing of units in other foreign collective investment schemes, the Finnish private placement rules may apply. Accordingly, if units in a non-Finnish non-UCITS are marketed solely to a limited number (not exceeding, in principle, 100) of pre-identified professional investors, as defined in the Investment Funds Act and the Securities Market Act, and in accordance with the private placement rules, the FSA's consent would not be required. Marketing units in a non-Finnish non-UCITS to other than professional investors in Finland always requires the prior consent of the FSA.

The statement issued by the FSA also includes provisions on, among others, translation requirements in connection with filing notifications and applications with the FSA and the language that may be used when marketing non-Finnish UCITS and non- Finnish non-UCITS in Finland. The FSA also provides some guidance as to what sort of activities qualify as marketing of fund units in Finland. For instance, the FSA has taken the view that Finnish investors' access to websites of foreign investment funds and subscription for their units over the internet would generally not require notification or licensing in Finland, provided that the investment fund does not market services or products in Finland or actively seek to acquire clients in Finland. It also requires that the websites or other materials of the investment fund do not contain information or instructions specifically for prospective investors in Finland.

Tarja Wist and Nina Rosenlew

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