Section 148: Compensation fund

148. Compensation fund (1) There shall be established and maintained in such manner as may be prescribed, one or more compensation funds, for such purposes as may be prescribed. (2) Without prejudice to subsection (1), a compensation fund may provide for the compensation of investors who suffer pecuniary loss as a result of— (a) the inability of a licensee under this Act or any collective investment scheme to satisfy claims arising from civil liability by it in connection with services provided; (b) fraud or defalcation by a licensee, a collective investment scheme or any of its officers or employees; or (c) the insolvency or bankruptcy of any licensee or collective investment scheme. (3) A compensation fund shall be administered in accordance with such regulations as may be prescribed. (4) Without prejudice to subsection (3), regulations made under this Act may provide for— (a) the management of the fund by such committee as may be set up by the Commission; [Issue 1] S7 – 54 Revised Laws of Mauritius (b) the levying of contributions from licensees and collective investment schemes and other means of financing the fund; (c) the power to subscribe to insurance policies; (d) the mode of determining the right to compensation payable under the fund and the circumstances in which such right may be excluded or modified; (e) the power to settle claims; (f) specifications as to the quantum of the compensation; (g) the right of subrogation to the fund in order to recover from any person whose liability is extinguished or reduced by the payment of the compensation; (h) the terms and conditions on which compensation is to be payable; and (i) accounts to be kept in respect of the fund. (5) Nothing in this section shall prevent any SRO, securities exchange or clearing and settlement facility from establishing such compensation fund under their rules for such purpose as may be approved by the Commission.