In the Republic of North Macedonia, the area of investment funds is regulated by the Law on Investment Funds, the Law on Securities, the Law on Trade Companies and the Law on Foreign Exchange Operations.
The Law on Investment Funds governs the establishment and operation of investment funds and management companies, the issuance and sale of units and shares, redemption of units, promotion of investment funds, and the operations of the depositary bank.
Depositary Bank (Custodian Bank)
A depositary bank of an investment fund is a bank that, for the needs of the fund, safeguards the fund’s assets, maintains separate accounts for the fund’s assets, and segregates the assets of each individual fund from the assets of other funds. It also monitors whether the fund management company manages the fund’s assets in accordance with legal regulations and the fund’s statute, among other responsibilities.
Only a bank headquartered in the Republic of North Macedonia that, according to the Law on Banks, has obtained approval from the National Bank of the Republic of North Macedonia to perform custodian activities may be appointed as a depositary bank.
The activities performed by the depositary bank for the management company must be separated from the bank’s other activities. The depositary bank that performs services for the investment fund maintains the assets of each fund in a separate account.
The depositary bank may not use the assets of the investment fund for transactions on its own account or for gaining any benefits for itself or its employees, except for the benefit of the unit owners or shareholders in the investment funds. The assets of investment funds held with the depositary bank do not form part of the bank’s own assets, nor can they be included in liquidation or bankruptcy proceedings, and they cannot be used to satisfy claims against the bank.
The depositary bank of the Fund is Komercijalna Banka AD Skopje, headquartered at 3 Vasil Iljoski Str., 1000 Skopje. The selection of Komercijalna Banka AD Skopje as the Fund’s depositary bank was approved by a Decision of the Securities and Exchange Commission No. UP 1 08-94 dated 18.11.2014.
The bank’s initial capital amounts to MKD 2,279,067.00, divided into 2,279,067 ordinary shares, each with a nominal value of MKD 1,000.00.
If the investment fund has assets outside the territory of the Republic of North Macedonia, the depository bank shall select a sub-depository bank to safeguard these assets, provided the sub-depository has a work permit issued by the competent authority in its home country. The sub-depository bank for the funds under the management of WVP Fund Management AD Skopje is NLB d.d.
Securities and Exchange Commission
The Commission supervises the operations of management companies, investment funds, and depositary banks in relation to the management of investment funds.
The Commission may, without limitation, examine the business books and other documents of management companies, investment funds, and depositary banks in relation to the operations of investment funds. Depending on how the supervision is carried out, it can be either indirect or direct:
Indirect supervision includes continuous monitoring and verification of data from reports, notifications, business records, and other documents that management companies, investment funds, and depositary banks are legally required to submit to the Commission.
Direct supervision is conducted through direct inspection of operational data at the premises of the market participant. The purpose is to determine whether its operations comply with applicable laws. Direct supervision may be carried out with or without prior notice, at the Commission’s discretion, and as part of its regular supervisory activities.