21.11.2016 - ESMA PUBLISHES REVISED UCITS Q&A

The European Securities and Markets Authority (ESMA) has published a revised version of its UCITS Q&A, adding two new Q&As, both relating to investment limits:

No more than 25 per cent of the units of any single collective investment undertaking

ESMA has clarified that where the underlying collective investment undertaking is an umbrella fund, this limit should be applied at the level of the individual sub-funds within that umbrella. This appears to be at odds with COLL 5.2.30(1) which provides that this concentration rule applies at the level of the umbrella only.

No more than 10 per cent of assets in units of a single collective investment undertaking

Similarly, ESMA has clarified that where the underlying collective investment undertaking is an umbrella fund, this limit should be applied at the level of the individual sub-funds within that umbrella.

18.11.2016 - UCITS REMUNERATION CODE - NO FCA GUIDANCE

The FCA has updated its webpage on the UCITS Remuneration Code (SYSC 19E) to confirm that it does not intend to issue guidance for firms on how to apply SYSC 19E. This means that there will be no official guidance from the FCA on its expectations around the use of proportionality.

The FCA points out that there are many points of correspondence between the remuneration requirements of the UCITS Directive and AIFMD, and between the ESMA guidelines applicable to each Directive, which firms may want to review.

The FCA states that UCITS management companies may find it useful to consider the principles in the FCA's existing AIFMD guidance in order to understand its expectations.