After prolonged discussions between the European Council and European Parliament, representatives confirmed that political agreement has been reached on UCITS V.

Aspects of the agreement of particular interest include:

Remuneration Policies

At least 50% of the variable part of a UCITS Fund Managers’ remuneration will be payable in shares in the UCITS they manage, unless the management of the UCITS accounts for less than half of the total portfolio.

A further 40% of this variable remuneration must be deferred for at least 3 years, to ensure the UCITS Fund Managers take a long-term view on running the portfolio.

ESMA will draft guidelines on the scope of who is covered by these remuneration policies. 

A key item to highlight is that the remuneration policies will not apply to third parties, such as administrators and outsourcing providers, to which UCITS Fund Managers can delegate functions, which differs from AIFMD remuneration policies.  AIFMD remuneration policies provide that where an AIFM delegates portfolio management or risk management activities, there can be no circumvention of remuneration rules and the remuneration policies impact certain key staff of entities to which portfolio management and risk management activities have been delegated. 


All member states will have to provide harmonised administrative penalties for UCITS that fail to comply with the authorisation and reporting rules.  Member states may decide, at a national level, to utilise existing criminal sanctions, as opposed to introducing new administrative sanctions, where breaches are subject to at least equivalent criminal penalties, however this can only be done within the first two years after the legislation comes into force.