Regulatory notices

ESMA published its Final Report on Guidelines on funds’ names using ESG or sustainability-related terms on May 14, 2024. These Guidelines were developed based on the input received during a consultation process conducted in the winter of 2022-2023 and on the current UCITS and AIFMD frameworks.

The primary aim of the Guidelines is to safeguard investors from unfounded or exaggerated sustainability assertions in fund names. Additionally, they aim to offer asset managers well-defined and quantifiable criteria to evaluate their eligibility in utilizing ESG or sustainability-related terms in fund names.

On May 7, 2024, ESMA published a Call for Evidence on the review of the UCITS Eligible Assets Directive (EAD).

In June last year, the European Commission has tasked ESMA with assessing the implementation of the EAD across Member States which is in force for nearly two decades in view of refreshing this text in accordance with the current products and market practices.

On 1st of May, the FCA published its Joint Roadmap with the Treasury to implementing the Overseas Funds Regime that will fade away the Temporary Marketing Permission Regime granted to EEA funds to continue marketed their shares/units in UK after the withdrawal of the country from the European Union.

In January 2024, the Government assessed the equivalence of the EEA UCITS schemes to the relevant UK regulations, excepted Money Market Funds (MMF) that remain excluded from the OFR but still benefiting of the TMPR until end of 2026. In between, new rules will have been introduced.

Recently, the central Bank of Ireland updated its procedure regarding the merger of an Irish UCITS with a domestic UCITS or a cross border merger with a foreign UCITS.

The procedures for both cases are described here below or available on the website of the Central Bank of Ireland.

With the entry into force of EMIR REFIT yesterday, the CSSF published an updated version of its eDesk user guide. Earlier this month, it was about new procedures in development that the Commission shared information.

Indeed, this year, the number of eDesk procedures dedicated to the fund management will increase:

Following the notification from the CBI and the CSSF of their intention to impose an investment restriction on Alternative Investment Fund Managers (AIFMs) established in Ireland and Luxembourg and managing GBP-denominated AIFs pursuing a LDI funding strategy, ESMA rendered its advice to both regulators yesterday.

ESMA’s analysis concludes that the conditions for taking actions under the Alternative Investment Fund Managers Directive (AIFMD) are met and the measures proposed by the CBI and the CSSF are justified and should contribute to improving the resilience EU GBP LDI.

On April 23, 2024, the FCA published its guidance on the anti-greenwashing rule.

This guidance is intended to help firms understand the FCA’s expectations under the anti-money laundering rule that will enter into force end of next month.

The anti-greenwashing rule is one part of a package of measures the FCA finalised in November 2023 through our Sustainability Disclosure Requirements (SDR) and investment labels regime (PS23/16).

The FCA consults on the extension of the Sustainability Disclosure Requirements (SDR) and investment labels regime to portfolio management services and follows its Consultation Paper (CP22/20) and corresponding Policy Statement (PS23/16) on SDR and investment labels, which introduced a package of measures for fund managers.

The new rules subject to this consultation does not include services where the clients are based overseas meaning those that either normally reside outside of the UK or have their registered office (or head office) outside of the UK. It also does not include portfolio management provided to a client that is a fund, or an Alternative Investment Fund Manager or management company for or on behalf of a fund (i.e., where the portfolio manager acts as a delegate).

On April 22, 2024, FinDatEx released the final EMT Version 4.2.

This version submitted to consultation earlier in March 2024 is now available. It integrates the previous one (EMT V4.1) with a supplementary UK specific section linked to detailed on-going costs.