Regulation 10 Collection and use of rights revenue

A collective management organisation must ensure—

(a)

that it is diligent in the collection and management of rights revenue;

(b)

that it keeps separate in its accounts—

(i)

rights revenue and any income arising from the investment of rights revenue; and

(ii)

any own assets it may have and income arising from such assets, from management fees or from other activities;

(c)

that it does not use rights revenue or any income arising from the investment of rights revenue for purposes other than distribution to right holders, except where it is allowed—

(i)

to deduct or offset its management fees in compliance with a decision taken in accordance with paragraph (1)(d)(iv) of regulation 7 (general assembly of members); or

(ii)

to use the rights revenue or any income arising from the investment of rights revenue in compliance with a decision taken in accordance with regulation 7(1)(d);

and

(d)

that where it invests rights revenue, or any income arising from the investment of rights revenue, it does so—

(i)

in the best interests of the right holders whose rights it represents;

(ii)

in accordance with the general investment and risk management policy referred to in paragraph (1)(d)(iii) and (vi) of regulation 7 (general assembly of members); and

(iii)

having regard to the following—

(aa)

where there is any potential conflict of interest, the collective management organisation must ensure that the investment is made in the sole interest of those right holders;

(bb)

the assets are invested in order to ensure the security, quality, liquidity and profitability of the portfolio as a whole; and

(cc)

the assets are properly diversified in order to avoid excessive reliance on any particular asset and accumulation of risks in the portfolio as a whole.