Moving towards UCITS VI

Rolling back on complexity?

The European Commission published on 26 July 2012 a wide-ranging consultation paper that will form the basis of a further update to the UCITS framework, dubbed “UCITS VI”.

UCITS VI could represent a significant rolling back from UCITS III in terms of eligible assets and the use of derivatives. Measures on efficient portfolio management (EPM) techniques may also curb practices in relation to securities lending, repos and reverse repos.

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The consultation

The consultation paper covered eight wide-ranging areas and sought more information on market practices. This briefing covers those key areas:

  • Eligible assets and use of derivatives
  • Efficient portfolio management techniques
  • OTC derivatives
  • Extraordinary liquidity management tools
  • Depositary passport
  • Money market funds
  • Long-term investments
  • Addressing UCITS IV

Since that consultation paper, initiatives relating to money market funds and long-term investments have been addressed separately outside of the UCITS framework. 

Further measures from the original UCITS VI consultation, particularly in relation to eligible assets, OTC derivatives and EPM techniques can be expected.

The delay in adopting UCITS V has undoubtedly impacted further progress on UCITS VI.

Moving towards UCITS VI
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