As detailed in the April edition of the Front Page and further highlighted in the May newsalert, CESR's consultation http://www.cesr-eu.org/data/document/10_108.pdf on guidelines on risk measurement and the calculation of global exposure and counterparty risk for UCITS will close on 31 May 2010.

The consultation sets out proposed Level 3 guidelines to accompany the Level 2 implementing measures for the UCITS IV Directive (2009/65/EC). CESR has suggested that the Level 2 measures and the Level 3 guidelines should be adopted as a single package by July 2010. The key purpose of these guidelines is to provide stakeholders with detailed methodologies and so to harmonise the approach of Member States to risk measurement and the calculation of global exposure and counterparty risk for UCITS.

The revised UCITS Directive must be implemented by Member States by 1 July 2011. CESR has emphasised that it believes that the Level 2 measures and the Level 3 guidelines on this topic should be adopted as a single package by July 2010.

The purpose of the level 2 and level 3 measures is to achieve a harmonised and consistent approach throughout the EU to risk measurement and the calculation of global exposure and counterparty risk for UCITS. In an Irish context, therefore, we can expect that the FR will be revising its Notices and Guidance Notes and is likely to hold a consultation regarding how the new measures will impact on , for example, the risk management process required for Irish UCITS funds.