Delay in Forming a New Government Leaves Government Proposal in Limbo
The UCITS IV Directive (1) should be implemented by the EU member states by 30 June 2011. Finland will fail to meet this deadline, because the general elections held in April have, for the time being, left the country without a government with a solid political mandate. While attempts to form a new government are still underway, the Parliament cannot address the implementation of UCITS IV. A report including drafts for the relevant amendments to be made to the Finnish Mutual Funds Act has been circulated for comments among interested parties and Finnish market participants in April. It is to be expected that the government proposal will be submitted to the Parliament in autumn 2011.
Directly Applicable EU Regulations Enter into Force on 1 July 2011
The two complementary regulations to UCITS IV Directive, i.e. the Key Investor Information Regulation (2) and the Notification Regulation (3), are directly applicable in the EU member states, and the FIN-FSA will process notifications of foreign UCITS that wish to start marketing shares in Finland in accordance with the Notification Regulation as of 1 July 2011. Thus, notifications concerning offering shares in Finland will be handled between the home state authority of the UCITS and the FIN-FSA as of 1 July 2011. According to non-confirmed information received from the FIN-FSA, the authority will require that the Key Investor Information Document (KIID) be translated to Finnish or Swedish and the rest of the documentation as required under the UCITS IV Directive and Notification Regulation shall, where necessary, be translated to English.
FIN-FSA Approach Will Facilitate Notifications During the Transitional Period
According to non-confirmed information received from the FIN-FSA, a non-Finnish UCITS shall submit the KIID to the FIN-FSA in connection with notifications according to the schedule required by the home state authority. Thus, if the home state authority has granted a transition period for adopting the KIID and the UCITS has decided to take advantage of the transition period, the KIID will not be required until the transition period has ended. In such cases, the FIN-FSA will accept a simplified prospectus translated to Finnish or Swedish instead of the KIID. The separate marketing document that Finland has to date required to be distributed to Finnish investors will no longer be required. The FIN-FSA is currently preparing instructions for notifications under the UCITS IV regime, which are expected to be published on the FIN-FSA website during June 2011.