ESMA’s guidelines on ETFs and other UCITS issues – ESMA 2012/832 - 21/12/2012
On 18 December 2012, ESMA issued new guidelines on ETFs and other UCITS issues.
The purpose of these guidelines is to:
- Protect investors by providing guidance on information that should be communicated by index-tracking UCITS and UCITS ETFs;
- Provide new guidance for UCITS on risk management and information disclosure requirements when entering OTC derivative transactions and efficient portfolio management techniques (“EPM”), such as securities lending and repos;
- Provide new guidelines regarding collateral management in the context of OTC derivatives transactions or EPM; and
- Set out criteria that should be respected by financial indices in order to be eligible assets for UCITS.
These new guidelines will be effective on 18 February 2013 with a 12 months grandfathering period.
In order to assist you in meeting these new requirements, our experts can
- Assess the impacts of the new guidelines on your activities and assist you in drafting amended procedures for impacted activities;
- Support in the review or design of collateral management and liquidity stress testing policies;
- Support you in the review and update of your risk management process in order to reflect new guidelines;
- Support you in the review of financial indices eligibility;
- Perform an independent valuation of financial indices and/or derivatives written on them; and
- Assist you in the update of your KIID and prospectus with newly required information.
Should you need to receive more information, please do not hesitate to contact our experts.
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