Financial Services Regulation & Compliance - Funds Nov 2017

DOMESTIC:

Central Bank AIFMD Q&A and UCITS Q&A

The Central Bank issued:

  • The Twenty-Seventh Edition of the Central Bank AIFMD Q&A with an amended Q&A 1094 in relation to the AIF acquiring Chinese shares through the Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock Connect.
  • The Twenty-first Edition of the Central Bank UCITS Q&A with an amended Q&A 1015 in relation to the UCITS acquiring Chinese shares through the Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock Connect.

Central Bank letter to industry on Brexit

The Central Bank issued a  letter to industry in relation to Brexit contingency planning for Investment Funds. This letter sets out considerations which investment funds and their managers should consider when planning for the impact of the UK’s withdrawal from the EU and the fulfilment of their obligations to their investors.

EUROPEAN

ESMA Q&As on the AIFMD and the UCITS Directive

ESMA updated its Q&A on the application of the AIFMD with new Q&As on the following.

  • Application of remuneration disclosure requirements to staff of the delegate of an AIFM to whom portfolio management or risk management activities have been delegated.
  • Disclosure of AIFM delegates' staff remuneration in annual reports.
  • Periodic reporting (under Article 13 of SFTR) for UCITS and AIFs to investors on the use of securities financing transactions and total return swaps.
  • Its Q&A on the application of the UCITS Directive with a new Q&A on periodic reporting (under Article 13 of the SFTR) for UCITS and AIFs to investors on the use of securities financing transactions and total return swaps.

Money Market Funds

ESMA published its final report on technical advice, draft implementing technical standards and guidelines under the MMF Regulation. The MMF Regulation MMFR will apply from 21 July 2018. Existing MMFs will have until 21 January 2019 to transition to the new regime. The Central Bank continues to engage with industry on the implementation and transition process.

EuVECAs and EuSEFs

The regulation amending the European Venture Capital Funds Regulation (EuVECA Regulation) and the European Social Entrepreneurship Funds Regulation (EuSEF Regulation) will apply from 1 March 2018.

ESMA on charges and mutual fund returns

ESMA published an article on The impact of charges on mutual fund returns which included a preliminary analysis of the impact of ongoing fees, one-off charges and inflation on the returns of mutual funds. Subsequently, ESMA noted an error in that article. ESMA issued a corrected version where the average rate of, and relative reductions in Return on Investment have been corrected.

IOSCO on termination of investment funds

IOSCO published its final report  setting out good practices for the termination of investment funds. The report sets out 14 good practices.     

IOSCO's fourth hedge fund survey

IOSCO published a report on the findings from its fourth hedge fund survey. The aim of the survey is to gather data from hedge fund managers and advisers about the markets in which they operate, their trading activities, leverage, funding and counterparty information.

Date published: 11 December 2017