The European Commission has adopted guidance for Member States’ financial market authorities to enhance the EU single market for retail investment funds by removing obstacles to their cross-border activity. The funds, known as “undertakings for collective investment in transferable securities” (UCITS), account for 70 per cent of all EU investments. These are professionally managed investment portfolios of ordinary households. The UCITS Directives regulate the management of these investments and protect investors through investment limits, disclosure requirements and independent supervision procedures. They also introduce a “passport system” which allows a UCITS fund authorised in one Member State to operate in all other Member States. The guidance concerns the inclusion of new financial instruments in the current scheme and instructions on scrutiny of investment funds from other Member States.