Approval of the investment conditions

(1) The investment conditions, and any amendment to them, require the approval of the Federal Institute. Approval may be applied for only by the following management companies:
1. capital management companies authorised to manage the type of investment fund concerned, and
2. in relation to domestic UCITS, EU UCITS management companies that have received authorisation from the competent authorities of their home Member State to manage UCITS, that intend to manage the UCITS domestically, that satisfy the requirements of Article 19(3) and (4) of Directive 2009/65/EC, that have successfully completed the notification procedure under sections 51 and 52, and that have furthermore submitted to the Federal Institute the documents listed in section 52(1), second sentence, for the investment fund concerned, or have referred to these under section 52(1), third sentence.
(2) Approval must be granted within a period of four weeks of receipt of the application for approval, where the investment conditions satisfy the statutory requirements and the application was submitted by a management company within the meaning of subsection (1), second sentence. Where the requirements for approval are not satisfied, the Federal Institute must inform the applicant of this within the period under the first sentence, stating the reasons, and must request missing or amended particulars or documents. Where the applicant is an EU UCITS management company, the Federal Institute must, before giving notice under the second sentence, hear the competent authorities of the home State of the EU UCITS management company. Upon receipt of the requested particulars or documents, the period named in the first sentence begins to run afresh. Approval is deemed to have been granted where no decision has been made on the application for approval within the period under the first sentence and no notice under the second sentence has been given. On application by the management company, the Federal Institute must confirm the approval under the fifth sentence. The Federal Institute may attach ancillary provisions to the approval. The management company may attach the investment conditions to the sales prospectus only where approval under subsection (1), first sentence, has been granted. The investment conditions approved by the Federal Institute must be made accessible to the public, in their respective current version, on the website of the capital management company or the EU UCITS management company. For open-ended retail AIF, the investment conditions may be published only once the management company is permitted to commence distribution of the investment fund under section 316.
(3) Where amendments to the investment conditions are incompatible with the previous investment principles of the investment fund, the Federal Institute grants approval only where the management company publishes the amendments to the investment conditions at least four weeks before their entry into force under subsection (4) and offers investors
1. either to demand the redemption of their units or shares without further cost, or
2. insofar as possible, to demand the exchange of their units or shares, without further cost, for units or shares of another investment fund that is compatible with the previous investment principles and is managed by the same management company or by an undertaking connected to the management company within the meaning of section 290 of the Commercial Code. This right under the first sentence, points 1 or 2, exists at the latest from the time at which investors are informed of the planned amendment to the investment conditions under subsection (4). Where the amendments are approved, or are deemed to be approved, they may enter into force at the earliest four weeks after the publication specified in subsection (4), first sentence. Section 255(3) and (4) remains unaffected.
(4) Intended amendments to the investment conditions that have been approved by the Federal Institute must be published in the Federal Gazette and, insofar as the units or shares of the investment fund concerned may be distributed within the territorial scope of this Act, additionally in a sufficiently widely circulated financial or daily newspaper or in the electronic information media named in the sales prospectus. In the case of amendments to particulars under section 162(2), point 11, that disadvantage investors, or amendments to particulars relating to material investor rights that disadvantage investors, and in the case of amendments within the meaning of subsection (3), first sentence, investors must, at the same time as the publication under the first sentence, be provided, by means of a durable medium, with the material content of the intended amendments to the investment conditions and the background to them, presented in a comprehensible manner; in the case of amendments to the previous investment principles within the meaning of subsection (3), first sentence, investors must additionally be informed of their rights under subsection (3). It must be stated where, and in what manner, further information on the amendment to the investment conditions may be obtained. Transmission is deemed to have taken place three days after posting or dispatch. This does not apply where it is established that the durable medium did not reach the recipient, or reached the recipient at a later time. The amendments may enter into force at the earliest on the day after publication in the Federal Gazette, but, in the case of amendments to the particulars under section 162(2), point 11, not before the expiry of four weeks after the corresponding publication. With the consent of the Federal Institute, an earlier date may be determined, insofar as this concerns an amendment that favours the investor.
(5) The content of existing contracts between the management company under subsection (1), second sentence, and the investors is automatically adjusted to amendments to the investment conditions approved after the conclusion of the contract that have become part of the contract,
1. insofar as the amendments to the investment conditions are necessary to implement new mandatory statutory or supervisory requirements, and
2. where the amendments to the investment conditions have become effective through the approval. The management company must inform investors of the amendments to the contracts under the first sentence.