8Organisational arrangements of the operator

8 Organisational arrangements of the operator

(1) The operator of a passport fund must at all times meet the organisational arrangements test. (2) For this section, the operator of the passport fund meets the organisational arrangements test if it has: (a) a well‑documented organisational structure that clearly assigns responsibilities and specifies reporting lines; and (b) adequate internal control mechanisms including procedures and systems that ensure that: (i) assets are managed in accordance with the current constituent documents and disclosure documents of the passport fund as well as the laws of the home economy for the fund and the Passport Rules for the home economy and each host economy for the fund; and (ii) records are kept to sufficiently explain the transactions of the passport fund, and all transactions in the interests of the fund; and (iii) registers of members are duly kept except for any part of the register of members that is kept by a person identified in registers of the operator as the person keeping a register in respect of particular interests identified in registers of the operator where the keeping of that part of the register by the person is regulated or acceptable under the laws of the home economy for the fund and, for interests held by a member who acquired them in a host economy for the fund, the person keeping the register is regulated by or acceptable to the host regulator; and (c) an adequate risk monitoring and management process including a risk management framework for the passport fund assets, based on the size, complexity and risk of the assets; and (d) a compliance framework that ensures ongoing compliance with relevant laws and regulations; and (e) adequate procedures to manage conflicts of interest.