Financial Service Regulation and Compliance - Funds December 2018

DOMESTIC

CBI is analysing UCITS funds that report to be actively managed

Director General Derville Rowland delivered a speech on the importance of effective culture within the financial sector, and the importance of being prepared for Brexit. On closet indexing, Ms Rowland noted that the Central Bank has begun analysis of 2,000-plus Irish domiciled UCITS funds that report to be actively managed. 

The proposed UK Temporary Permissions Regime will allow already registered umbrella funds to market additional sub-funds in the UK post-Brexit.

The UK Treasury published a draft Statutory Instrument in respect of the proposed Temporary Permissions Regime which is to come into effect in the event of a no-deal Brexit. The draft Statutory Instrument envisages that the regime will be available to UCITS and alternative investment funds. This can demonstrate that at least one other sub-fund in their umbrella was registered with the Financial Conduct Authority and opted into the regime before 29 March 2019. This is a very welcome development in that it provides a framework for asset managers to launch and sell new products into the UK post-Brexit.

EUROPEAN

Consultation on environmental, social and governance refinements to the UCITS and AIFMD frameworks.

The ESAs are consulting (among other things) on sustainable finance initiatives to support the European Commission’s sustainability action plan in the area of investment funds. This includes refinements to the alternative investment fund Managers Directive (AIFMD) and UCITS regimes.

Cross-border distribution of collective investment funds

The proposals for a draft directive and a draft regulation to make the cross-border distribution of alternative investment funds and UCITS simpler, quicker and cheaper continue through the legislative process and will now proceed to interinstitutional negotiations.

PRIIPs KID

The ESMA stakeholder group has called on the European Commission to implement a review of the PRIIPs Regulation. ECON proposed that the exemption for UCITS concerning obligations under the PRIIPs Regulation relating to key information documents should be prolonged for a further two years.

For further information please contact a member of the Financial Regulation team.

Date published: 15 January 2019