Legal & Compliance

Regulatory Framework of Actively Managed Certificates

The site explains AMCs using exchange-listed iMaps ETIs as a real-world reference implementation

Introduction

Actively Managed Certificates (AMCs) operate within established legal and regulatory frameworks that govern the issuance, listing, and distribution of structured investment products. Understanding these frameworks is essential for evaluating how AMCs are created, who is responsible for their issuance, and how they may be offered to investors.

This page explains the legal and compliance considerations relevant to Actively Managed Certificates, including issuance structures, prospectus requirements, exchange listing obligations, and cross-border distribution within Europe. Where relevant, iMaps Exchange Traded Instruments (ETIs) are referenced as an example of how these requirements are implemented in practice.

Legal Nature of Actively Managed Certificates

Actively Managed Certificates are typically issued as debt securities.

Unlike investment funds, which represent collective investment schemes with pooled investor assets, AMCs are securitised instruments issued by a legal entity. The certificate represents a claim linked to the performance of a defined reference portfolio.

This structural distinction affects:

investor rights
regulatory classification
disclosure obligations
distribution rules

Because AMCs are securities rather than funds, they are generally governed by securities law and structured product regulation rather than fund regulation.

Role of the Issuer

The issuer is the legal entity responsible for creating and issuing the certificate.

Issuer responsibilities typically include:

structuring the product
preparing regulatory documentation
ensuring compliance with applicable securities regulations
arranging listing on a stock exchange
maintaining product documentation and disclosures

The issuer does not necessarily manage the investment strategy itself. In many AMC structures, portfolio management is delegated to an external investment manager.

Base Prospectus and Product Documentation

Actively Managed Certificates offered to investors are typically issued under a base prospectus.

A base prospectus is a regulatory document that describes:

the legal structure of the product
the rights of investors
risk factors
fee structures
issuance and trading mechanics

For each individual certificate issued under the programme, additional documentation such as final terms specifies the characteristics of that particular product.

These documents form the legal basis for the issuance and distribution of the certificate.

Retail Public Offering in Europe

In the European Economic Area (EEA), securities offered to retail investors generally require an approved prospectus issued under the EU Prospectus Regulation.

Once approved by a competent authority, the prospectus may be passported to other European jurisdictions, allowing the product to be offered to retail investors in multiple countries.

This regulatory framework enables structured investment products, including certain AMC structures, to be distributed across European markets while maintaining consistent disclosure standards.

Example: Prospectus Framework of iMaps ETIs

iMaps ETIs are issued under a base prospectus approved by the Financial Market Authority (FMA) of Liechtenstein.

The prospectus may be passported to other European jurisdictions, allowing the certificates to be publicly offered in multiple countries in accordance with applicable regulatory requirements.

As part of this framework:

the ETI structure is defined in the base prospectus
individual ETIs are issued under final terms
product documentation describes risks, fees, and structural characteristics

This illustrates how AMC structures can operate within a regulated European securities framework.

Exchange Listing and Market Oversight

Once issued, many Actively Managed Certificates are admitted to trading on regulated stock exchanges.

Exchange listing introduces additional layers of oversight and operational requirements, including:

trading rules and market supervision
disclosure obligations
reporting requirements
settlement and clearing arrangements

Exchange trading also provides transparency in pricing and allows investors to access certificates through standard brokerage channels.

Investor Disclosure and Transparency

Regulatory frameworks require issuers to provide clear disclosure regarding:

product structure
risk factors
fees and costs
trading characteristics
investor rights

These disclosures are provided through official documentation, including prospectuses, final terms, and exchange information systems.

Investors are expected to review these documents carefully before investing.

Compliance Responsibilities

Compliance responsibilities within an AMC structure are shared across several participants:

Issuer: responsible for regulatory documentation, issuance framework, and exchange listing.

Investment Manager: responsible for executing the investment strategy in accordance with applicable agreements.

Broker or Custodian: responsible for holding assets and executing portfolio transactions.

Exchange and Clearing Systems: responsible for trading infrastructure, settlement, and market transparency.

This multi-party framework helps ensure operational integrity and regulatory oversight across the lifecycle of the product.

Cross-Border Distribution Considerations

Because Actively Managed Certificates are securities, their distribution across jurisdictions may involve additional regulatory requirements.

These may include:

prospectus passporting within the EEA
local investor disclosure requirements
brokerage platform eligibility
tax considerations depending on jurisdiction

Investors should consider the regulatory environment applicable to their country of residence before investing.

Conclusion

Actively Managed Certificates operate within established securities law frameworks that govern issuance, documentation, exchange trading, and investor disclosure.

Understanding the legal and compliance structure behind AMCs helps clarify how these instruments are issued, how investor protections are implemented, and how products may be distributed across different markets.

The iMaps reference case illustrates how an exchange-listed AMC programme can be implemented within a regulated European securities framework while maintaining the structural flexibility associated with actively managed portfolios.

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