Information on investor rights
General information on legal enforcement regarding German regulated investment vehicles
GEG and its affiliated companies are not licensed as a capital management company (Kapitalverwaltungsgesellschaft, KVG) pursuant to the German Investment Code (Kapitalanlagegesetzbuch, KAGB). GEG generally works in cooperation with a licensed German KVG when implementing investment projects. However, it may also decide to rely on the support of a fund management company from another EU state; in this case, the following information applies only to a very limited extent.
In the following, you will find a summary of the options of legal enforcement, which may be available to investors in a regulated German investment fund in addition to the classic civil law action before the civil courts. More detailed information will be provided – electronically and, on request, also in paper form – by the respective KVG or the foreign fund management company GEG cooperates with on a specific investment project.
Out-of-court settlement procedures for consumers
To the extent a KVG has joined the ombudsman’s office of the BVI Bundesverband Investment and Asset Management e.V., consumers may call this ombudsman’s office free of charge in the event of disputes in connection with the provisions of the KAGB (www.ombudstelle-investmentfonds.de). A consumer is a natural person who concludes a legal transaction for a purpose that cannot be attributed to his or her commercial or independent professional activity.
If a KVG has not joined the BVI’s ombudsman’s office, consumers can turn to the official consumer arbitration board at the Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht, BaFin) (www.bafin.de/schlichtungsstelle) in the event of a dispute.
Furthermore, consumers may also turn to the EU’s online dispute resolution platform (www.ec.europa.eu/consumers/odr) in the event of disputes relating to online sales contracts or online services contracts. The platform itself is not a dispute resolution body, it merely puts the parties in touch with a competent national dispute resolution body.
Collective law enforcement
In addition to the aforementioned options for individual dispute resolution, you also have the option, under certain conditions, to participate in collective legal protection proceedings such as the model declaratory action (Musterfeststellungsklage) pursuant to Section 606 of the German Code of Civil Procedure (Zivilprozessordnung, ZPO) or in capital investor model proceedings (Kapitalanlegermusterverfahren) pursuant to the corresponding law (Capital Investor Model Proceedings Act) (Kapitalanleger-Musterverfahrensgesetz, KapMuG). In addition to the consumer status, each of the aforementioned proceedings require that a certain quorum of affected investors participate therein. Before joining such proceedings and for more details on the requirements for participation, you should seek appropriate legal advice.
Revocation of cross-border distribution
The KVG or the fund management company from another EU state with which GEG cooperates in the course of the implementation of an investment project may revoke a distribution notification once submitted for units of a fund in an EU member state other than its state of domicile. With effect from the date of the revocation, the KVG may neither directly nor indirectly offer or place a unit of the relevant fund in the state in which the distribution has been revoked. For a period of 36 months from the date of revocation, the KVG may not engage in any pre-marketing activities for the units of the fund or for comparable investment strategies or concepts in that state.
The intention to revoke must be made known by means of a medium that is suitable for the typical investor, generally available and customary for the distribution of funds. If the fund is an open-end fund, the KVG must make a general offer to all investors in the other EU state to take back or buy back their units free of charge. The offer must be publicly available for at least 30 working days and must be addressed individually to investors whose identity is known.
GEG Investment Advisory GmbH
Neue Mainzer Strasse 2-4 – MainTor
60311 Frankfurt am Main