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Home > Regulation > Regulation Tracker > Ucits IV

Ucits IV

regulation keypoints

The Ucits IV directive was given the go-ahead by the European Commission in January 2009 and includes new rules for a management company passport, cross-border distribution, mergers, master-feeder structures and key investor information. Ucits IV repeals all other Ucits directives.

* The Ucits IV directive introduces five key modifications in the Ucits regulatory landscape (which dates back to 1988).

* The directive introduces management company passports, which allow Ucits authorised in one member state to be managed remotely by a management company established in another member state.

* Ucits IV aims to simplify the procedures for cross-border distribution.

* It introduces a framework for the domestic and cross-border mergers of Ucits allowing consolidation of Ucits.

* Three different forms of mergers are provided for: 1) merger by way of absorption. 2) Merger by formation. 3) A scheme of amalgamation or arrangement.

* Fund mergers are possible even if the investment strategies of the merging funds differ.

* Only the approval of the home state regulator of the merging UCITS is required.

* Master-feeder structures are introduced to facilitate (mostly tax-driven) asset-pooling. A Ucits (feeder) is allowed to be (fully) invested in another Ucits (master).

* The simplified prospectus is replaced with a key investor information (Kid) document designed to present comprehensible information similar for the Ucits of each member state.

* Ucits IV will rationalise the notification process and replace the existing simplified prospectus by July 2012 at the latest.

* The new notification process will be a regulator-to-regulator process. The Ucits’ home member state regulator will have only 10 working days to review a standardised (in form and content) notification file and to transmit it to the host member state, allowing the immediate right to start marketing activities in that country.

* The Key Investor Document (Kid) will be a short document containing key investors information, the content, form and presentation of which being fully standardised to help investors compare and understand Ucits.

To read more about Ucits IV click here.

  1. Published by EU, 11 Jul 2012

    EU clamps down on Ucits rules interpretations

    Member states’ interpretation of Ucits directive could lead to inconsistent investor risks.

    Proposed: deadline for responses .

  2. Published by FSA, 11 Oct 2011

    Key investor information requirements

    How the European Union’s Ucist IV directive will be implemented in the UK has been explained by the FSA.

    Final ruling: effective from 30 Jun 2011.

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