UCITS Directive/ AIFMD/ Additional Flashcards
What is a CIS?
Collective investment scheme
What two types of CIS are there in the UK?
Unit Trust and a OEIC (same as ICVC same as SICAV)
What rules must a CIS adhere to if being set up?
The COLL rules which is a resource book from the FCA
Under COLL rules what legislation does a Unit trust operate under?
governed by trust law (common law) not widely accepted/ understood outside of the UK
Under COLL rules name the principle positions in a unit trust and what they must have awareness of?
Has a trustee – who is the registered legal owner of any assets that are placed under the trust set up.
Fund manager – runs the trust day to day – purchases / sells the units
The trustee and fund manager have to be aware of the trust deed/law that the trust is being operated under.
Under COLL rules what is important about those in principle positions?
Fund manager and trustee must be independent from one another
Trustee and fund manager must both be authorised persons
Under COLL rules what legislation does an OEIC operate under?
Company law
Describe the features of an OEIC
- Doesn’t have a trustee
- Has a depository – not a person but an entity. The registered legal owner of any assets in the fund
- Also has an ACD – Authorised corporate director
- Both the ACD and Depository have to be independent of one another and both have to be authorised persons.
For any CIS (Unit trust or OEIC) what two wider categories can these be placed under by regulators? And what is this dependant on?
fall into two categories – either they are regulated funds or unregulated funds. This is according to our regulators and concerns what type of structure the fund is offering.
What are the features of a regulated CIS?
Generally marketable – is available to anyone and for all types of consumer (UK)
What is UCITS?
A harmonised law which means that CIS can be marketed beyond jurisdiction once granted permission from FCA
What are the three effects of the UCITS Directive?
o Creates a ‘single market’ for collective investment schemes in the EU
o A collective investment scheme authorised in any member state of the EU can be marketed (without further authorisation) in any other member state
o Local tax and marketing laws apply
Who is responsible for recognising UK Schemes under UCITS?
The FCA
What did UCITS III develop?
Management Directive
• Increased scope of passported activities under UCITS
• Introduced the simplified prospectus
Product directive
• Expanded the range of financial instruments permitted in UCITS funds
What did UCITS IV develop?
• Further changes including a passport for management companies, procedures for cross-border fund mergers and replacing the simplified prospectus with a key investor information document (KIID)
