On 21st April 2021, the European

2022.07.31
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On 21st April 2021, the European

On 21st April 2021, the European Commission adopted Delegated Acts (non-legislative acts adopted by the European Commission to amend or supplement legislation) amending the current UCITS, AIFMD and MIFID II legislation as part of its wider initiative to continue transforming EUs economy into a sustainable financial system and become carbon neutral by 2050. On 2 August 2021 various amending measures were published in the EU Official Journal which will require EU Alternative Investment Fund Managers, EU UCITS management companies and EU MiFID investment firms (including portfolio managers and adviser/arrangers) to integrate sustainability risks and factors into their policies and procedures. This can be achieved by reviewing the current requirements and proposed changes via a gap analysis and implementing an action plan based on the results. Grant Thornton refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the context requires. https://ie.linkedin.com/in/dwayne-price-b7343a18, instructions how to enable JavaScript in your web browser, Financial Accounting and Advisory Services (FAAS), Delegated Acts incorporating sustainability issues and considerations, Privacy statement professional engagements, Grant Thornton Ireland response to the conflict in Ukraine. This update focuses on the financial services aspects of the programme. EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Draft UCITS delegated directive as regards the sustainability risks and sustainability factors to be taken into account for Undertakings for Collective Investment in Transferable Securities, Draft AIFMD delegated regulation as regards sustainability risks and sustainability factors to be taken into account by Alternative Investment Fund Managers, Draft MiFID delegated directive as regards the integration of sustainability factors and preferences into the product governance obligations, Draft MiFID delegated regulation as regards the integration of sustainability factors, risks and preferences into certain organisational requirements and operating conditions for investment firms. At EY, our purpose is building a better working world. The Network for Greening the Financial System published aprogress reporton implementation of its guide for supervisors on integrating climate-related and environmental risks into prudential supervision. The European Parliament published apress releasethat it rejected the two objections on the European Commission Delegated Regulation supplementing the Taxonomy Regulation ((EU) 2020/852) relating to climate change mitigation and adaptation (C(2021)2800) (known as the Taxonomy Climate Delegated Act). In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities. To ensure that the submitted documents can be reviewed in good time, the CSSF expects UCITS and CSSF-authorised AIFs that are still fundraising to file by 31 October We regularly issue Newsflashes on new laws, bills of law and on-going developments, to alertyou on important new legal matters, Follow us on social media to keep up with our latest legal and business updates. Consideration should also be given notably to the legislation applicable to benchmark administrators, investee companies and distributors or advisors in order to set up appropriate communication and data flows. The European Comission has published on 8 June 2020 a set of draft delegated acts, including, inter alia: These delegated acts are part of a broader action plan on sustainable finance and look to streamline sectoral legislation with the emerging framework and reinforce the regulations: The sustainable finance action plan will bring significant changes in the investment fund value chain. Firms will need to ensure that appropriate organisational arrangements are in place and internal controls, systems and processes are re-designed to include analysis of sustainability factors and detection of sustainability risks. The insights and services we provide help to create long-term value for clients, people and society, and to build trust in the capital markets. number of reasons including connected world class research, pro-enterprise policy and an Market Abuse Regulation means Regulation (EC) No / of the European Parliament and of the Council on insider dealing and market manipulation (market abuse); General Regulations means the Charitable Incorporated Organisations (General) Regulations 2012. remember settings),Performance cookiesto measure the website's performance and improve your experience,Advertising/Targeting cookies, which are set by third parties with whom we execute advertising campaigns and allow us to provide you with advertisements relevant to you,Social media cookies, which allow you to share the content on this website on social media like Facebook and Twitter. Alignment of definition of sustainability risks with SFDR. Prospectus Regulation means Regulation (EU) 2017/1129. The Delegated Acts were developed following public consultation work carried out in 2018 and ESMAs final report published in April 2019. The Financial Stability Board (FSB) published aspeechby the FSB Chair, that among other things, considers how the FSB will address ongoing and future financial stability challenges in 2022 and beyond. EEA Regulations means the Immigration (European Economic Area) Regulations 2006.

This material has been prepared for general informational purposes only and is not intended to be relied upon as accounting, tax, or other professional advice. All Rights Reserved. The long-awaited so-called level 2 measures for Directive 2014/91/EU of 23 July 2014 as regards depositary functions, remuneration policies and sanctions (Directive UCITS V) provide for the following: Written contract appointing the depositary (Article 2).The Delegated Regulation sets out the minimum requirements for the written agreement to be entered into between the investment company or the management company for each of the common funds that the management company manages on the one hand and the depositary on the other hand. The Prudential Regulation Authority (PRA) published areporton climate-related financial risk management and the role of capital requirements. Directive 2009/138/EC - Solvency II Directive, Copyright 2006 - 2022 Law Business Research. All Rights Reserved. Changes to the Outsourcing legislation, specifically when offshoring. Basel III Regulation means, with respect to any Affected Person, any rule, regulation or guideline applicable to such Affected Person and arising directly or indirectly from (a) any of the following documents prepared by the Basel Committee on Banking Supervision of the Bank of International Settlements: (i) Basel III: International Framework for Liquidity Risk Measurement, Standards and Monitoring (December 2010), (ii) Basel III: A Global Regulatory Framework for More Resilient Banks and Banking Systems (June 2011), (iii) Basel III: The Liquidity Coverage Ratio and Liquidity Risk Monitoring Tools (January 2013), or (iv) any document supplementing, clarifying or otherwise relating to any of the foregoing, or (b) any accord, treaty, statute, law, rule, regulation, guideline or pronouncement (whether or not having the force of law) of any governmental authority implementing, furthering or complementing any of the principles set forth in the foregoing documents of strengthening capital and liquidity, in each case as from time to time amended, restated, supplemented or otherwise modified. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. However, some minimum standards stemming from upcoming UCITS Directive, AIFMD and SFDR rules will also be applicable to fund managers who do not consider principal adverse impacts and do not manage light green or dark green products. However, the assessments do not take into consideration the clients sustainability preferences and whether they wish to integrate environmentally friendly financial instruments into their portfolio. Substance: Juggling with tax, TP, regulatory and operational requirements, Lassurance de demain na jamais t aussi prsente. Review ourcookie policyfor more information. The Financial Action Task Force published aconsultation paperon amendments to recommendation 24 on transparency and beneficial ownership of legal persons. We previously referred to these measures in our April 2021 briefing on the wider EU Sustainable Finance Package as it affects asset managers and large portfolio companies and, before that, in the Sustainability section of our 2021 New Year Briefing. (and, to the extent applicable, any other federal rules and regulations relating to cable television, including but not limited to, those described in 47 C.F.R. You may withdraw your consent to cookies at any time once you have entered the website through a link in the privacy policy, which you can find at the bottom of each page on the website. The changes require senior management to be responsible for the integration of sustainability risks. 2020 EYGM Limited. A detailed disclosure should be provided to clients outlining the reasons for recommending an investment strategy and how it meets clients objectives and sustainability preferences. HM Treasury published aconsultation paperon regulating interest free buy-now-pay-later credit products. The links to the various amending measures are below: Legislation amending Solvency II and the Insurance Distribution Directive was also published. The Taxonomy Climate Delegated Act will now be examined by the Council of the EU. Firms are required to retain the necessary resources and expertise in order to effectively integrate sustainability risks. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. The Delegated Regulation clarifies the independence requirements. How do you move long-term value creation from ambition to action? November 2021: A series of discussion papers will be published focussing on Sustainability Disclosure Requirements. Implementing Regulation means the Regulation (EEC) No 574/72 of the Council laying down the procedure for implementing Regulation (EEC) No 1408/71 on the application of social security schemes to employed persons, to self-employed persons and to their families moving within the Community and includes amendments and adaptations from time to time applicable thereto;. Select your location Close country language switcher, EY Luxembourg Partner, Sustainability Leader. For more information about our organization, please visit ey.com. In addition thereto, management companies or investment companies are required to put in place a decision-making process for choosing and appointing the depositary, based on objective pre-defined criteria and meeting the sole interest of the UCITS and the investors of the UCITS. Passionate about sustainability. The changes will impact all EU firms that are subject to the AIFMD, UCITS and/or MiFID regulations.

Considering the guidance provided earlier this year by ESMA, as published on 1 February 2016 in its UCITS Q&A, the revision of the depositary agreements should be finalised promptly and in accordance with the requirements outlined in the Delegated Regulation once the Luxembourg legislator has adopted the law implementing Directive UCITS V. According to our latest information, the respective parliamentary vote should take place in April 2016. OHS Regulation means the Workers Compensation Act (British Columbia), including without limitation, the Occupational Health & Safety Regulation (BC Regulation 296/97, as amended by BC Regulation 185/99) enacted pursuant to such Act, all as such Act or Regulations are amended or re-enacted from time to time. Most comprehensive library of legal defined terms on your mobile device, All contents of the lawinsider.com excluding publicly sourced documents are Copyright 2013-. The EBA published apress releaseannouncing it has repealed its guidelines on the security of internet payments. At Grant Thornton we meet the challenges of our clients. This introductory article provides an overview of the key requirements of the legislation, the timelines involved and main topics included in your recovery plan. The Delegated Acts require firms to consider and assess sustainability risks by using quantitative or qualitative data analysis. 2015/35). The UCITS Directive and AIFMD draft delegated acts clarify notably the duties of investment fund managers (IFMs) to take into account the social and environmental factors and risks in their governance, organisation, conflicts of interest policies, investment due diligence as well as their risk policies and procedures. On 24 March 2016, the European Commission Delegated Regulation EU 2016/438 (the Delegated Regulation) supplementing the UCITS V Directive with regard to obligations of depositaries was published in the Official Journal of the European Union. These measures comprise of the gross method as set out in Article 7 of the AIFMD Delegated Regulation and the commitment method as set out in Article 8 of the AIFMD Delegated Regulationuntil June 2023 which would allow most legacy USD LIBOR contracts to mature before the relevant LIBOR rate ceases to be calculated. TUPE Regulations means the Transfer of Undertakings (Protection of Employment) Regulations 2006, as amended. The Financial Stability Board published itsfinal reporton the lessons learnt from the COVID-19 pandemic from a financial stability perspective. ThePackaged Retail and Insurance-based Investment Products (UCITS Exemption) (Amendment) Regulations 2021 (SI 2021/1149)were published, together with anexplanatory memorandum. The European Supervisory Authorities (that is, the EBA, EIOPA and ESMA) published ajoint final report(JC 2021 50) on draft regulatory technical standards (amending RTS) regarding the content and presentation of sustainability disclosures under Articles 8(4), 9(6) and 11(5) of the Sustainable Finance Disclosure Regulation ((EU) 2019/2088) (SFDR). Without limiting the generality of the foregoing, Basel III Regulation shall include Part 6 of the European Union regulation 575/2013 on prudential requirements for credit institutions and investment firms (the CRR) and any law, regulation, standard, guideline, directive or other publication supplementing or otherwise modifying the CRR. Delegated legislation integrating sustainability into UCITS Directive, AIFMD, MiFID II, Commission Delegated Regulation (EU) 2021/1255 of 21April 2021 amending Delegated Regulation (EU) No231/2013 as regards the sustainability risks and sustainability factors to be taken into account by Alternative Investment Fund Managers, Commission Delegated Regulation (EU) 2021/1254 of 21 April 2021 correcting Delegated Regulation (EU) 2017/565 supplementing Directive 2014/65/EU of the European Parliament and of the Council as regards organisational requirements and operating conditions for investment firms and defined terms for the purposes of that Directive, Commission Delegated Regulation (EU) 2021/1253 of 21 April 2021 amending Delegated Regulation (EU) 2017/565 as regards the integration of sustainability factors, risks and preferences into certain organisational requirements and operating conditions for investment firms, Commission Delegated Directive (EU) 2021/1270 of 21 April 2021 amending Directive 2010/43/EU as regards the sustainability risks and sustainability factors to be taken into account for Undertakings for Collective Investment in Transferable Securities, EU policy, regulatory and legislative updates, FCA updates webpage on how to apply for authorisation, ESMA launches call for Evidence on Pre-Hedging. The International Capital Market Association published an updated version of itsguideto reporting repo transactions under both the EU and UK versions of the Regulation on reporting and transparency of securities financing transactions (SFTR). With the exception of the insolvency protection which is a new requirement, all other obligations are largely identical to those set out in the frame of the Alternative Investment Fund Managers Directive (AIFMD).

A draft delegated directive amending the Commission Directive 2010/43 implementing certain provisions of the UCITS Directive, A draft delegated regulation amending the Commission Regulation 231/2013 implementing certain provisions of AIFMD, Two delegated acts amending two delegated acts implementing MiFID II requirements on product governance, organizational requirements and operating conditions of investment firms, on sustainability-related disclosures in the financial services sector (SFDR), on the EU taxonomy for sustainable activities (Taxonomy), establishment, implementation and maintenance of clear and document decision-making procedures and organisational structure specifying reporting lines, allocation of responsibilities with proper discharge, internal control mechanisms to ensure compliance with decisions and procedures, internal reporting and communication and effective information flows with any third party involved, maintenance of adequate and orderly records of business and internal organisation, the implementation of the investment policy in the prospectus, the fund rules, the instrument of incorporation or the offering documents, the investment strategies approval process, the investment policy/strategy/risk limits implementation/compliance for each managed UCITS, the approval / periodic review of the adequacy of internal procedures for undertaking investment decisions for each managed UCITS, the approval / periodic review of the risk management policy, arrangements, processes and techniques, including the risk limit system, the investment policy/strategy/risk limits implementation/compliance for each managed AIF, the approval / periodic review of the adequacy of internal procedures for undertaking investment decisions for each managed AIF. In the EU the AIFMD Delegated Regulation includes conversion methodologies for derivative instruments for the calculation of the exposure of an AIF in accordance with the gross method, including delta adjustments for options, to avoid overstate the market risk of funds. The next generation search tool for finding the right lawyer for you. Questions? Obligations of the depositary (Articles 3 to 17).Further details are provided in the Delegated Regulation relating to oversight duties, cash monitoring, safekeeping duties with regard to assets held in custody and other assets, due diligence when selecting and appointing third parties, segregation and insolvency protection of UCITS assets when delegating custody functions. 2022 Proskauer Rose LLP. Will your NFT investments soon be subject to VAT? Section 76.1 et seq. GTIL and the member firms are not a worldwide partnership. The FCA published itsperimeter report2020/21. On 2 August 2021, the following were published in the Official Journal of the EU: The Delegated Regulations and Directive enter into force on 22 August 2021. The BoE published thefinancial policy summary and recordof the meeting of its Financial Policy Committee. Understand your clients strategies and the most pressing issues they are facing. These requirements are specific to UCITS and impose strict rules as to the composition of the management body of the management company or the investment company on the one hand and the depositary and its delegates on the other hand.