The Irish Funds Industry Association (“IFIA”) Guidance Paper 3 on Trustee Duties (the “Guidance Paper”) has been updated to reflect industry and regulatory changes.
The Guidance Paper focuses on the duties of trustees as set out in UCITS Notice 4 and Non-UCITS Notice 7.
UCITS Notice 4 and Non-UCITS Notice 7 set out seven duties (“Trustee Duties”) which must be performed in Ireland and which cannot be delegated by a trustee to a third party.
The Guidance Paper has been updated to provide guidance to trustees in meeting their obligations under UCITS Notice 4 and Non-UCITS Notice 7 in fulfilling Trustee Duty 7.
Trustee Duty 7 – “To ensure that material matters are reported to the Central Bank” requires that where a trustee is aware of an error or breach and deems it material, the trustee must ensure that the Central Bank is notified of such material breach or error.
Trustee Duty 7 gives consideration to other parties who have responsibility to report material matters, and reporting should be made within a reasonable timeframe.
The Guidance Paper also outlines what is considered a material breach, however, this list is not exhaustive and should be used for illustrative purposes only.
The Guidance Paper is likely to be amended again following publication of Level 2 measures under the AIFMD.