Financial Services Regulation & Compliance - Funds July 2018


CBI requirements for UCITS investing in a non-UCITS investment fund

On 5 July 2018, the CBI updated its Undertakings for Collective Investments in Transferable Securities (UCITS) Q&A to clarify its requirements relating to investment by a UCITS in a non-UCITS investment fund.

CBI highlights key relevance of the work of the organisational effectiveness director

The CBI issued a notice to Fund Management Companies (which includes self-managed investment funds). The notice advises Fund ManCos that from 1 July 2018 the CBI will be assessing how they have implemented and embedded the CBI requirements in respect of the organisation of Fund Management Companies within their organisations.



The ESMA UCITS Q&A was updated on 23 July 2018 to include new Q&As on:

  • UCITS investing in other UCITS with different investment policies and restrictions
  • Calculation of issuer concentration limits
  • Reuse of assets by a UCITS depositary
  • The supervision of branches of UCITS ManCos providing MiFID investment services


The ESMA Alternative Investment Fund Managers Directive (AIFMD) Q&A was updated on 23 July 2018 to include a new Q&A considering where supervisory responsibility lies when MiFID services are provided through a branch in a different Member State from that of the AIFM.

ESMA letter to the Commission on share cancellation under MMFR

The ESMA published a letter to the Commission on the issue of the compatibility of the reverse distribution mechanism (RDM), or share cancellation, with the Money Market Funds Regulation (MMFR). The letter requests that the Commission make the opinion of the Legal Service of the Commission on the compatibility of the RDM with the MMFR available to the wider public as soon as possible, in order to ensure clarity and transparency vis-à-vis market participants and investors.

ESMA publishes list of MoUs 

ESMA published its updated list of AIFMD MoU signed by the EU authorities.

ESMA holds supervisors’ workshop for National Competent Authorities on closet indexing 27 June to promote supervisory convergence in NCAs’ supervision of closet indexing.

ESMA held a workshop to promote supervisory convergence among National Competent Authorities (NCAs) to promote supervisory convergence in the regulation of closet indexing. Closet indexing is a practice whereby asset managers claim to manage their funds in an active manner whilst in fact staying very close to a benchmark and charging management fees in line with actively managed funds.

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

Date Published: 13 August 2018