In a speech given in Brussels on 16 November 2017, Steven Maijoor, Chairman of the European Securities and Markets Authority (ESMA), identified three principle workstreams for ESMA for 2018:

1. Continuing the current data collection exercise regarding costs and charges of retail funds and extending this exercise to all other types of products, including EU AIFs;
2. Performing further work on closet indexing given the likelihood of these funds to charge “unduly high fees” while “failing to deliver the service to which they committed themselves in their offering documents”; and
3. Performing  further supervisory convergence work on performance fees.

Mr Maijoor also announced that ESMA intends to produce further guidance for UCITS and AIFs stress tests, following FSB and ESRB recommendations. With regard to the recent ESMA opinions regarding continental relocation of UK firms in connection with Brexit, he reaffirmed ESMA’s view that these were consistent with the level 1 and level 2 texts, as it is “precisely in the nature of Level 3 guidance to take the existing framework and elaborate on it, in order to give a clearer picture of what firms are expected to do in order to comply.” He further explained that the opinions are not questioning the principle of delegation, but rather the way it is implemented, in terms of substance and oversight of non-EU branches.  Read Mr Maijoor's full speech here.