The Securities Industry and Financial Markets Association (SIFMA) has published its response to the European Commission’s Questionnaire on the UCITS depositary function. In summary SIFMA supports:

  • A clarification of depositary safekeeping and supervisory duties to enhance consistency across the EU but cautions against too much detail.
  • A clarification of the liability regime applying to depositaries but specifies that this should be based on the responsibility of depositaries to exercise reasonable care and diligence in the performance and delegation of their services.
  • A clarification of the organisational requirements applicable to depositaries.

The SIFMA also agrees on the need to clarify the entity types eligible to act as depositaries but argues that this should be based on functions provided rather than institutional structure. On supervisory issues the SIFMA agrees that depositaries should be subject to a specific ‘depositary’ approval by national regulators and endorses the creation of an EU passport for UCITS depositaries. In the context of other investor protection issues, the SIFMA believes that the UCITS framework should allow the UCITS’ net asset value to be calculated by fund managers or by an independent valuator.

View SIFMA response to Commission Consultation Paper on the UCITS depositary function, 15 September 2009