On October 5, 2015 the Central Bank of Ireland (the “Central Bank”)issued a new set of regulations relating to Irish domiciled UCITS, their management companies and their depositaries titled Central Bank (Supervision and Enforcement) Act 2013 (Section 48(1)) (Undertakings for Collective Investment in Transferable Securities) Regulations 2015(the “CBI UCITS Regulations”). The CBI UCITS Regulations will replace the UCITS Notices from November 1, 2015.
The Central Bank UCITS Guidance Notes are also being replaced with website guidance which “will retain all of the guidance currently located in the Guidance Notes and UCITS Notices”. That website guidance is now accessible on the Central Bank’s website.
Simultaneously, the Central Bank has issued an updated UCITS Q&A document (7th Edition) and has published its Feedback Statements to 2014’s CP77 (Consultation on publication of UCITS Rulebook) and CP84 (Consultation on the adoption of ESMA’s revised guidelines on ETFs and other UCITS issues).
In its Feedback Statement on CP77, the Central Bank says “As stated in CP77, the Central Bank is issuing the final UCITS Rulebook on a statutory basis. Having considered the options available to the Central Bank to achieve this, the Central Bank has decided to publish the final UCITS Rulebook in the form of Central Bank regulations”.
CBI UCITS Regulations
Does this all sound a bit familiar?
At one level, the CBI UCITS Regulations are simply the result of a process of bringing together, in one place, those conditions or requirements which the Central Bank previously imposed via the UCITS Notices, but stripping out all elements of repetition of provisions of the UCITS Regulations and also what might be considered to constitute guidance.Although presented as exactly that – “a UCITS Rulebook which consolidates into one document all of the conditions which the Central Bank imposes on UCITS, their management companies anddepositaries” – these CBI UCITS Regulations seem to be something more than that, perhaps more focused on enforcement than regulation.
What was wrong with the UCITS Notices?
UCITS, their management companies and their depositaries were already subject to the conditions and requirements which the Central Bank, pursuant to Regulation 123 of the UCITS Regulations, issued via the UCITS Notices “for the purposes of the orderly and proper regulation of UCITS….”.In issuing the new CBI UCITS Regulations the Central Bank is not trying to – it cannot – alter the UCITS Directive or the European Communities (Undertaking for Collective Investment in Transferable Securities) Regulations 2011 (the “UCITS Regulations”) which implement the UCITS Directive into domestic Irish law.
It also does not seem to be adding to the UCITS requirements which, for the last 25 years, it has applied via a set of UCITS Notices which, in essence, put meat on the bone of the UCITS Regulations and evolved to take account of developments such as the Eligible Assets Directive, various ESMA Guidelines and domestic Central Bank rule making around the operation of UCITS management companies, depositaries and fund administrators.