Article 32: Powers of the Authority to Remove and Replace Custodian

Article 32: Powers of the Authority to Remove and Replace Custodian

a. The Authority shall have the power to remove the custodian which was appointed by the fund manager or take any other measures it deems appropriate, in the event of:

1) The custodian ceasing to carry out custody activity without notification to the Authority under the Capital Market Institutions Regulations;

2) The cancellation or suspension by the Authority of the custodian’s relevant authorisation to carry out custody activity under the Capital Market Institutions Regulations;

3) A request by the custodian to the Authority to cancel its authorisation to carry out custody activity;

4) The Authority believing that the custodian has failed, in a manner which the Authority considers material, to comply with the Capital Market Law or its Implementing Regulations;

5) Any other event determined by the Authority – based on reasonable grounds- to be of sufficient significance.

b. If the Authority exercises its power pursuant to paragraph (a) of this Article, the relevant fund manager must appoint a replacement custodian to that investment fund in accordance with the Authority’s instructions, the fund manager as well as the removed custodian shall co-operate fully in order to facilitate a smooth transfer of responsibilities to the replacement custodian during the first (60) days of the appointing the replacement custodian. The custodian must transfer, where the Authority decides its necessary and applicable, all the contracts related to the relevant investment fund to the replacement custodian.