As reported in our e-alert of 5 October 2015, the Central Bank of Ireland has issued Regulations (CB UCITS Regulations) which consolidate and replace all existing conditions imposed on UCITS, their management companies and depositaries under the existing UCITS Notices and Guidance Notes.  The CB UCITS Regulations came into effect on 1 November 2015.

As indicated, for the most part, the rules in the CB UCITS Regulations are the same as the conditions set out in the existing UCITS Notices and Guidance Notes, however, a small number of policy changes have been included.  In addition, the Central Bank has been more prescriptive in its outline of the requirements of some existing policy matters. 

A significant change introduced is the concept of a “responsible person”.  Responsibility for compliance with many of the obligations of the CB UCITS Regulations falls on this responsible person.  The responsible person is the management company of a UCITS, where one is appointed, or the UCITS itself if it is self-managed. 

The Central Bank had indicated that the CB UCITS Regulations incorporated any derogations previously granted by the Central Bank to its published policy.  However, where there were any existing derogations identified as not being included in the CB UCITS Regulations, the Central Bank allowed for an application to be made, before 1 November 2015, to receive a similar waiver under the CB UCITS Regulations.

The CB UCITS Regulations set out a small number of new policy matters and also set out more prescriptive descriptions of certain disclosure requirements.  The Central Bank has confirmed that where prospectus text needs to be updated to reflect the text of the CBI UCITS Regulations or where the CBI UCITS Regulations have refined existing rules, those text updates may be addressed at the next prospectus update. 

There are a number of matters set out in the CB UCITS Regulations that may require an amendment to the UCITS constitutional documents.  While we believe that most constitutional documents are likely to be viewed as compliant with the significant matters, a review against the constitutional documents of each UCITS should be undertaken to confirm that this is the case.

The CB UCITS Regulations set out a number of changes to current requirements in terms of operational procedures.  These relate to matters such as acceptable collateral, OTC trading counterparties and treatment of shareholders.  These are in effect since 1 November 2015 and internal procedures must be in compliance from that date. 

Under the CB UCITS Regulations a number of operational matters have more prescriptive requirements in terms of documentation of processes and rationale.  It is likely that good documentary processes are already in place for these but firms should ensure that they meet the stated requirements.