AIMA

The Alternative Investment Management Association

Alternative Investment Management Association Representing the global hedge fund industry

UCITS

The UCITS Directive introduces a harmonised framework of investment protection and product regulation that enabled UCITS (Undertakings in Collective Investment in Transferable Securities) funds registered in one Member State to be marketed freely across the European Union.

UCITS are passportable open-ended vehicles with the sole objective of raising capital from the public and collectively investing in various financial instruments.

Significant developments in financial markets have necessitated several alterations to the UCITS regulatory framework.  The current iteration of the UCITS Directive, UCITS IV, introduced a number of improvements such as a management company passport, master-feeder structures, mergers and improved investor disclosure.

On 3 July 2012 the European Commission published a proposal for a draft UCITS V Directive. The draft UCITS V Directive covers five issues: eligibility to act as a depositary, criteria for delegating custody, liability for the loss of financial instruments held in custody, the remuneration of UCITS managers, and sanctions for breaches of the UCITS Directive. The draft also includes amendments to the UCITS Directive provisions which relate to access to telephone and data records and will empower the European Commission to adopt Level 2 measures specifying matters such as the circumstances in which financial instruments held in custody should be considered as lost.

The publication of the draft UCITS V Directive was closely followed by the publication of a further consultation document on UCITS issues, on 26 July 2012, which is widely known as ‘UCITS VI’. The consultation paper invites responses to questions which relate to 8 different elements of the UCITS framework: the eligible assets in which a UCITS fund can invest, efficient portfolio management techniques, OTC derivatives, extraordinary liquidity management tools, the possibility of introducing a depositary passport, money market funds, long-term investments and improvements that could be made to the UCITS IV Directive.


Key legislative documents

Level 1

Directive 2009/65/EC of the European Parliament and of the Council of 13 July 2009 (UCITS IV)

Level 2

Commission Regulation (EU) No 583/2010 (key investor information)

Commission Regulation (EU) No 584/2010 (the standard notification letter, on-the-spot verifications, investigations and the exchange of information between competent authorities)

Commission Directive 2010/42/EU (fund mergers, master-feeder structures and notification procedure)

Commission Directive 2010/43/EU (organisational requirements, conflicts of interest, conduct of business, risk management and content of the agreement between a depositary and a management company)

Commission Directive 2007/16/EC (Eligible Assets Directive)


Guidelines/opinions/other useful resources

ESMA Guidelines for competent authorities and UCITS management companies (August 2014)

ESMA opinion on Article 50(2)(a) of the UCITS Directive (November 2012)

ESMA's Q&A: Key Investor Information Document (KIID) for UCITS (September 2012)

ESMA Q&As on Guidelines on ETFs and other UCITS issues (July 2013)

ESMA final guidelines on ETFs and other UCITS issues for competent authorities and UCITS management companies (December 2012)

Final Guidelines - Report and Consultation paper: Guidelines for ETFs and other UCITS issues (July 2012)


Consultation documents

ESMA Discussion Paper - Calculation of counterparty risk by UCITS for OTC financial derivative transactions subject to clearing obligations (July 2014)

European Commission UCITS: Product Rules, Liquidity Management, Depositary, Money Market Funds, Long-term Investments (July 2012)


AIMA documents

Position Paper: UCITS V – Set Ratio of Fixed to Variable Remuneration and Performance Fees (May 2013)

Response to European Commission consultation paper on UCITS: Product Rules, Liquidity Management, Depositary, Money Market Funds, Long-term Investments (October 2012)

UCITS V Position Paper (September 2012)

 


Other relevant documents

CESR’s guide to clear language and layout for the Key Investor Information document (December 2010)

CESR Guidelines - Transition from the Simplified Prospectus to the Key Investor Information document (December 2010)

CESR Guidelines on the Selection and presentation of performance scenarios in the Key Investor Information document (KII) for structured UCITS (December 2010)

CESR Guidelines - Risk Measurement and the Calculation of Global Exposure and Counterparty Risk for UCITS (July 2010)

CESR Guidelines on the methodology for the calculation of the synthetic risk and reward indicator in the Key Investor Information Document (July 2010)

CESR Guidelines on the methodology for calculation of the ongoing charges figure in the Key Investor Information Document(July 2010)

CESR Guidelines - Common definition of European money market funds (May 2010)

CESR Guidelines - Risk management principles for UCITS (February 2009)

 

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Sub Menu

  1. AIMA's Policy Principles
  2. Asset Management Regulation
    1. EU Asset Management Regulation
      1. AIFMD
      2. European Capital Markets Regulation
      3. MiFID / MiFIR
      4. UCITS
      5. European Venture Capital Directive
      6. Shareholder Rights Directive
      7. European Long Term Investment Fund Regulation
      8. Loan Origination Funds
      9. Capital Raising
      10. AIFMD-Related Events
    2. US Hedge Fund Adviser Regulations
      1. Registration and Reporting
      2. Incentive-Based Compensation
      3. JOBS Act
    3. Asia Pacific Asset Management regulation
    4. Other Jurisdictions’ Asset Management Regulation
    5. Systemically Important Financial Institutions ('SIFIs')
    6. Remuneration
      1. UK
      2. United States
      3. CRD IV and CRR
      4. AIFMD
      5. MiFID
    7. Shadow Banking
    8. Volcker Rule
    9. Other
    10. Systemic Risk Reporting
    11. Dealing Commision
    12. Corporate Governance
  3. Markets Regulation
    1. Bank/Capital Regulation
      1. Capital Requirements Directive
      2. EU Bank Structural Reforms
    2. Derivatives/Clearing
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      2. MiFID / MiFIR
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      4. Dodd-Frank Act Title VII
      5. Hong Kong
      6. IOSCO
      7. Singapore
    3. High Frequency Trading
      1. ESMA Guidelines
      2. MiFID / MiFIR
      3. MAD / MAR
      4. Flash Crash
      5. IOSCO
      6. Germany
      7. CFTC Automated Trading
    4. Insurance Regulation
      1. Solvency II
    5. Market Abuse
      1. MAD / MAR
      2. Indices as Benchmarks
    6. Position Limits
      1. MiFID / MiFIR
      2. CFTC Position Limits
    7. Resolution of Financial Institutions
      1. Europe
        1. EU Bank Recovery and Resolution Directive
        2. EU Non-Bank Recovery and Resolution
      2. CPSS-IOSCO
      3. Financial Stability Board
      4. UK
      5. USA
    8. Short Selling
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    11. Trading
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  4. Tax Affairs
    1. Automatic Exchange of Information (AEOI)
      1. FATCA
      2. EU - AEFI
      3. OECD - Global Standard on AEFI
    2. Australia - Investment Manager Regime (IMR)
    3. BEPS
    4. FAIFs and FINROFs
    5. FIN 48 and IAS 12
    6. Financial Transaction Tax (FTT)
    7. UK Investment Management Exemption (IME)
    8. UK Offshore Funds Regime
    9. Other
  5. Search
  6. Resources
    1. Guidance Notes
    2. Jurisdictional Guides
    3. Noticeboard
      1. AIFMD
      2. BEPS
      3. CFTC Registration and Exemptions
      4. Dealing Commission
      5. Derivatives
      6. FATCA
      7. FTT
      8. High Frequency Trading
      9. MiFID / MiFIR
      10. Other Hot Asset Management Topics
      11. Other Hot Markets Topics
      12. Position Limits
      13. Trading
      14. UK Partnership Tax Review
      15. Volcker Rule
    4. Hedge Fund Manager Training
    5. Quarterly Regulatory Update
    6. Webinar Programme
    7. Regulatory Compliance Association
      1. About the Regulatory Compliance Association
      2. RCA Curricula and initiatives for alternative investment firms
      3. Meet the regulators and Sr. Fellows