Subsection 2: Funds open to non-professional investors

Subject to article L. 214-24-41, a fonds commun de placement, which does not have legal personality, is a co-ownership of financial instruments and deposits, the units of which are issued and redeemed at the request of subscribers or unitholders, as the case may be, and at net asset value plus or minus fees and commissions, as the case may be. The provisions of the Civil Code relating to joint ownership…

A mutual fund is set up at the initiative of a management company, which manages the fund. This company draws up the fund rules. Subscribing to or acquiring units in a fonds commun de placement implies acceptance of the fund rules.

The minimum amount of assets that the fund must hold when it is set up is set by decree. These assets are valued, in the light of a report drawn up by the auditor, under conditions set by decree. Any contribution in kind is assessed by the auditor under his responsibility.

In all cases where the provisions relating to companies and financial securities require the surname, first names and domicile of the holder of the security to be indicated, and for all transactions carried out on behalf of the co-owners, the name of the mutual fund may be validly substituted for that of all the co-owners.

Unless otherwise stipulated in the fund rules, unitholders or their beneficiaries may not cause the fund to be split.

Unitholders are liable for the debts of the co-ownership only up to the amount of the fund’s assets and in proportion to their share.

The fund manager, the board of directors or the management board of the management company appoints the fund’s auditor for a period of six financial years, after obtaining the approval of the Autorité des marchés financiers. The appointment of an alternate auditor is not required. Fund unitholders shall exercise the rights conferred on shareholders by articles L. 823-6 and L. 823-7 of the French Commercial Code. The statutory auditor shall…

The redemption by the fund of its units and the issue of new units may be temporarily suspended by the management company when exceptional circumstances so require and if the interests of the unitholders or the public so dictate, under conditions laid down in the fund regulations. In the same circumstances, where the disposal of certain assets would not be in the interests of the unitholders, the other assets may…

The fund is represented vis-à-vis third parties by the company responsible for its management. This company may take legal action to defend or assert the rights or interests of unitholders.

The management company is required to make the declarations stipulated in articles L. 225-126 and L. 233-7 of the French Commercial Code, for all shares held by the mutual funds it manages. Articles L. 225-126, II and III and articles L. 233-14 and L. 247-2 of the French Commercial Code are applicable. When the management company complies with the notification obligation mentioned in article L. 214-24-22, it is not bound…