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These Rules are issued pursuant to section 34 of the Monetary Authority Law (2020 Revision) (\u201cMAL\u201d), which provides that the Cayman Islands Monetary Authority (the \u201cAuthority\u201d) may, after private sector consultation, issue or amend rules or statements of principle or guidance concerning the conduct of licensees and their officers and employees, and any other persons to whom and to the extent that the regulatory laws may apply. 1.2. These Rules should be read in conjunction with the Authority\u2019s Rule on Contents of Marketing Materials of Registered Private Funds.\", \"element\": \"section\", \"heading\": null}, {\"eId\": \"sec_2\", \"num\": \"2.\", \"text\": \"Objective 2.1. To set out the Authority\u2019s rules on the Segregation of Assets \u2013 Registered Private Funds pursuant (each subparagraph of paragraph 5 below referred to as a \u201cRule,\u201d and collectively, the \u201cRules\u201d), to the MAL.\", \"element\": \"section\", \"heading\": null}, {\"eId\": \"sec_3\", \"num\": \"3.\", \"text\": \"Scope 3.1. These Rules apply to all Private Funds registered under section 7 of the Private Funds Law, 2020 (\u201cPFL\u201d) other than Alternative Investment Vehicles.\", \"element\": \"section\", \"heading\": null}, {\"eId\": \"sec_4\", \"num\": \"4.\", \"text\": \"Definitions 4.1. Fund means any Private Fund registered under section 7 of the PFL that is not an Alternative Investment Vehicle. 4.2. Portfolio means all financial assets and liabilities of a Fund and any part thereof, including \u201cinvestor funds\u201d and \u201cinvestments\u201d as those terms are used in the definition of Private Fund in section 2 of the PFL. 4.3. Section 17 Person means a person appointed by a Fund under section 17 of the PFL to hold the Custodial Fund Assets of the Fund in custody. 4.4. All other capitalised terms used in the Rules shall have the meanings ascribed to them in the PFL. July 2020 Segregation of Assets \u2013 Registered Private Funds _____________________________________________________________________________\", \"element\": \"section\", \"heading\": null}, {\"eId\": \"sec_5\", \"num\": \"5.\", \"text\": \"Segregation of Assets 5.1. The Portfolio must be segregated and accounted for separately from any assets of the Manager or Operator(s) or any Section 17 Person. 5.2. A Fund must ensure that any Manager, Operator or Section 17 Person that holds or manages the Portfolio complies with Rule 5.1. 5.3. The overriding requirement of Rule 5.1 is that a Fund must ensure that no Manager, Operator or Section 17 Person uses the Portfolio to finance its own or any other operations. 5.4. 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\u2013\n\nRegistered Private Funds\n\n1.\nStatutory Authority\n1.1.\nThese Rules are issued pursuant to section 34 of the Monetary Authority Law\n(2020 Revision) (\u201cMAL\u201d), which provides that the Cayman Islands Monetary\nAuthority (the \u201cAuthority\u201d) may, after private sector consultation, issue or\namend rules or statements of principle or guidance concerning the conduct of\nlicensees and their officers and employees, and any other persons to whom and\nto the extent that the regulatory laws may apply.\n1.2.\nThese Rules should be read in conjunction with the Authority\u2019s Rule on Contents\nof Marketing Materials of Registered Private Funds.\n2.\nObjective\n2.1.\nTo set out the Authority\u2019s rules on the Segregation of Assets \u2013 Registered\nPrivate Funds pursuant (each subparagraph of paragraph 5 below referred to\nas a \u201cRule,\u201d and collectively, the \u201cRules\u201d), to the MAL.\n3.\nScope\n3.1.\nThese Rules apply to all Private Funds registered under section 7 of the Private\nFunds Law, 2020 (\u201cPFL\u201d) other than Alternative Investment Vehicles.\n4.\nDefinitions\n4.1.\nFund means any Private Fund registered under section 7 of the PFL that is not\nan Alternative Investment Vehicle.\n\n4.2.\nPortfolio means all financial assets and liabilities of a Fund and any part\nthereof, including \u201cinvestor funds\u201d and \u201cinvestments\u201d as those terms are used\nin the definition of Private Fund in section 2 of the PFL.\n\n4.3.\nSection 17 Person means a person appointed by a Fund under section 17 of\nthe PFL to hold the Custodial Fund Assets of the Fund in custody.\n\n4.4.\nAll other capitalised terms used in the Rules shall have the meanings ascribed\nto them in the PFL.\n\nJuly 2020\n\nSegregation of Assets \u2013 Registered Private Funds\n_____________________________________________________________________________\n5.\nSegregation of Assets\n5.1.\nThe Portfolio must be segregated and accounted for separately from any\nassets of the Manager or Operator(s) or any Section 17 Person.\n\n5.2.\nA Fund must ensure that any Manager, Operator or Section 17 Person that\nholds or manages the Portfolio complies with Rule 5.1.\n\n5.3.\nThe overriding requirement of Rule 5.1 is that a Fund must ensure that no\nManager, Operator or Section 17 Person uses the Portfolio to finance its own\nor any other operations.\n\n5.4.\nFor the purposes of Rule 5.3 the following shall not in itself, constitute the\nfinancing of the operations of a Manager, Operator or Section 17 Person:\n5.4.1 remitting to the relevant Investors, redemption, withdrawal or\ndistribution proceeds being paid on behalf of the Fund;\n5.4.2 paying fees, charges and expenses that are payable by an Investor in\nconnection\nwith\nthe\npurchase,\nconversion,\nholding,\ntransfer,\nwithdrawal or redemption of Investment Interests of the Fund;\n5.4.3 acquiring or disposing of assets for investment purposes in accordance\nwith the Fund\u2019s constitutive documents and Marketing Materials;\n5.4.4 paying fees, charges, expenses and taxes that are properly payable by\nthe Fund and as disclosed in and in accordance with the Fund\u2019s\nconstitutive documents or Marketing Materials or as otherwise\ndisclosed to Investors; or\n5.4.5 use or transfer of assets as consented to by or on behalf of the Fund,\nprovided that the possibility of use or transfer is disclosed in the\noffering documents or otherwise disclosed to investors.\n5.5.\nThe Operator(s) of a Fund must establish, implement, and maintain, (or\noversee the establishment, implementation, and maintenance of) strategies,\npolicies, controls, and procedures to ensure compliance with these Rules,\nconsistent with the Fund\u2019s Marketing Materials and appropriate for the size,\ncomplexity, and nature of the Fund\u2019s activities and Investors.\n6.\nEnforcement\n\n6.1.\nWhenever there has been a breach of the Rules, the Authority\u2019s regulatory\npolicies and procedures as contained in its Enforcement Manual will apply, in\naddition to any other powers provided in the PFL and the MAL.","akn_extracted_at":"2026-06-22 15:40:07.192707+00","cms_id":"2020-0104","law_type":"subordinate","year":"2020","number":"104","title":"Rule on Segregation of Assets \u2013 Registered Private Funds","status":"in_force"},"provenance":{"files":[{"file_id":"5192","expr_id":"297","kind":"akn_xml","filename":"2020-0104_SL 104 of 2020.akn.xml","source_url":null,"storage_path":"\/Users\/q\/kyleg-data\/working\/SUBORDINATE\/2020\/2020-0104\/2020-0104_SL 104 of 2020.akn.xml","content_md5":"aa904fcea94a6d8adc1ba2d469a8f83d","byte_size":"7403","http_last_modified":null,"fetched_at":"2026-06-22 15:40:07.250821+00"},{"file_id":"593","expr_id":"297","kind":"pristine_pdf","filename":"2020-0104_SL 104 of 2020.pdf","source_url":"\/cms\/images\/LEGISLATION\/SUBORDINATE\/2020\/2020-0104\/2020-0104_SL 104 of 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