9. Can Fund Managers receive Management Fees and how is this process regulated?

Yes, Fund Managers may receive Management Fee.

Management fee is remuneration of a Fund Manager. This fee covers management expenses (salary of management company’s team, rent costs, operation costs and others) as well as costs associated with the provision of investment advice (investment advisory fee).

Management Fee is regulated by Fund’s (or Syndicate’s) corporate documents. The amount of Management Fee may vary from 1.5% to 2.5% per year of total commitments. Furthermore, it is common to include Management Fee reduction provisions so that after the end of the investment period the amount of Management Fee will gradually reduce.

There are no regulatory restrictions on the amount of management fee. However, there is a restriction concerning investment advisory contracts. An Investment Advisor may not receive a performance-based fee unless all investors in a Fund (or a Syndicate) are qualified investors.