European depositary regulation


European depositary regulation

Striking the right balance?

Executive Summary

In response to the financial crisis, the G20 countries made strengthening the stability of the financial system a primary focus of their regulatory reform regime. Policymakers in both the US and the EU quickly realized that improving market conduct and strengthening investor confidence were also key to restoring public trust in the industry and in financial markets in general. As a result, the financial services industry has been confronted with—and has to adapt to— the persistent flow of regulatory change within their new “business as usual” environment.

As part of the effort to strengthen investor protection for investment fund investors in the EU, the AIFMD (Alternative Fund Managers Directive), which also covers previously unregulated fund structures, and the review of the UCITS Directive (UCITS V) were initiated. Both initiatives, amongst others, introduce increased requirements for depositaries, in particular, a strict liability regime for financial instruments held in custody by the depositary on behalf of the AIF/AIFM or UCITS. While the AIFMD has been fully implemented, the revised UCITS framework will become applicable on 18 March 2016, with the implementing measures currently being finalized.

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Performance magazine issue 19, January 2016

Performance is a triannual digest, dedicated to investment management professionals, which brings you the latest articles, news and market developments from Deloitte’s professionals and clients.

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