French Monetary and Financial Code
In forceI. - The assets of a general-purpose investment fund may also include, up to the limit of 10% stipulated in II of article R. 214-32-18 :
1° warrants ;
2° Savings bonds
3° Promissory notes
4° mortgage notes
5° Shares or units in FIAs established in another Member State of the European Union or in investment funds governed by foreign law that meet the criteria laid down in the general regulations of the Autorité des marchés financiers;
6° Shares or units in the following FIAs or undertakings for collective investment in transferable securities:
a) Feeder undertakings for collective investment mentioned in articles L. 214-22 and L. 214-24-57 ;
b) (Repealed) ;
c) UCITS and AIFs covered by paragraphs 1, 2 and 6 of sub-section 2, paragraph 2 or sub-paragraph 1 of paragraph 1 of sub-section 3 of this section which invest more than 10% of their assets in shares or units of collective investment schemes or investment funds;
d) General professional funds referred to in Article L. 214-144 ;
e) Specialised professional funds referred to in Article L. 214-154;
f) Fonds communs de placement à risques mentioned in article L. 214-28, fonds communs de placement dans l'innovation mentioned in article L. 214-30, fonds d'investissement de proximité mentioned in article L. 214-31 and fonds professionnels de capital investissement mentioned in article L. 214-160 ;
g) (Repealed) ;
6° bis Units, shares or debt securities issued by specialised financing institutions covered by paragraph 3 of sub-section 5 of this section;
7° Eligible financial securities and money market instruments which do not meet the conditions set out in I of article R. 214-32-18 ;
8° Units or shares in real estate collective investment schemes, professional real estate collective investment schemes or foreign schemes mentioned in 5° of I of article L. 214-36.
In addition, the 10% limit mentioned in the first sub-paragraph includes units or shares in UCITS, FIAs covered by paragraphs 1, 2 and 6 of sub-section 2 of paragraph 2 or sub-paragraph 1 of paragraph 1 of sub-section 3 of this section, FIAs governed by another Member State of the European Union or foreign investment funds which themselves invest more than 10% of their assets in units or shares of UCITS, FIAs governed by paragraphs 1, 2 and 6 of sub-section 2, paragraph 2 or sub-paragraph 1 of paragraph 1 of sub-section 3 of this section, FIAs governed by another Member State of the European Union or foreign investment funds.
For the purposes of this paragraph, shares in open-ended real estate investment companies (sociétés de placement à prépondérance immobilière à capital variable) referred to in article L. 214-62 are covered by point 8 only.
II. - The assets of a general-purpose investment fund may also include debt securities, up to the limit of 10% stipulated in I, if these comply with the following rules:
1° Ownership of the debt is based either on a registration, an authentic instrument or a private deed whose evidential value is recognised by French law;
2° The receivable is not subject to any security other than that which may have been created to achieve the management objective of the general purpose investment fund;
3° The debt is subject to reliable valuation in the form of an accurately calculated and regularly established price, which is either a market price or a price provided by a valuation system making it possible to determine the value at which the asset could be exchanged between informed parties entering into an agreement with full knowledge of the facts in the context of an arm's length transaction;
4° The liquidity of the debt enables the general-purpose investment fund to meet its redemption obligations towards its holders and shareholders, as defined by its articles of association or fund rules.
