S.L. 370.32 Art. 43Liability of the depositary.

(1) A depositary lite which provides custody services to the AIFs referred to regulation 38(1)(b) shall be liable for any loss or prejudice suffered by the AIFM, the AIF or the investors of the AIF

due to the depositary’s fraud, wilful default or negligence, including the unjustifiable failure to perform in whole or in part its obligations pursuant to:

(a) the provisions of the Act, the regulations and the Rules issued thereunder;

(b) the depositary agreement appointing the depositary;

(c) any other requirements prescribed by the competent authority.

(2) A depositary lite as referred to in sub-regulation (1) shall not be liable for any loss or prejudice suffered by the AIF or the unit-holders of the AIF as a result of the acts or omissions of the AIFM, except where and to the extent that the depositary has failed to perform its functions and duties in terms of the provisions of the Act, the regulations and the Rules issued thereunder: Provided that the term "depositary" shall be deemed to include such third party to whom functions, duties or assets may be delegated or entrusted in terms of regulation 44.

(3) Liability to the investors of the AIF may be invoked directly or indirectly through the AIFM, depending on the legal nature of the relationship between the depositary, the AIFM and the unit-holders.