- On 12 March 2018 the European Commission issued legislative proposals to amend the existing legal framework for the cross-border distribution of investment funds in the EU containing a Directive, which would have to be implemented into local legislation, and a Regulation which would have direct effect in EU Member States.
- These proposals aim at modifying the AIFM and UCITS Directives as well as introducing a regulation to standardise the requirements for cross-border distribution of both AIFs and UCITS in the EU in order to reduce regulatory burdens, reduce costs for fund managers and therefore increase the volume of funds marketed in the EU.
- While there are many positive aspects such as clear definitions, standardised guidelines, increased transparency and updated procedures, the proposals lack consistency regarding regulatory fees and have an extremely narrow scope of application regarding the definition of “pre-marketing”.
- ESMA holds a central role in implementing the cross-border regime, promoting EU-wide transparency and consistency for AIFs and UCITS marketing practices and requirements.
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