Good progress made in funds (UCITS/AIFs) cross-border distribution


Good progress made in funds (UCITS/AIFs) cross-border distribution review

20 December 2018

Regulatory News Alert

On 3 December 2018, the European Parliament ECON Committee agreed its position on the cross-border barriers to fund (UCITS and AIFs) distribution.

In a nutshell, all compromises (incl. the extension of the UCITS exemption) were passed with a large majority - a positive factor for the Trilogues discussions with the European Commission and EU Council that will be required to finalize the text of the regulation.

The final ECON position now reflects the following:

  • A broad definition of “pre-marketing” that applies to EU AIFs to include the ones already existing in other Member States than the targeted host
  • The ECON succeed in introducing a review clause for the UCITS pre-marketing regime with the implicit aim to align it with AIFs 
  • The Commission will also have to consider in a report the effect of the proposed amendments on the AIFMD 3rd-country regime (as per Articles 35 and 37-41 of the AIFMD) before this comes into effect
  • The numerical thresholds for de-notification envisaged in the original proposal have been removed. However, the trilogue phase has to confirm that view
  • The obligations of host Member State NCAs are clarified vis-à-vis those investors that choose to remain invested in funds for which the national marketing regime has ceased
  • On the extension of the UCITS PRIIPS exemption, the Commission is given one more year to finalise its Level-1 review (until 31 December 2019) while the UCITS exemption is extended by two year (until 31 December 2021)
PDF - 213kb

Next Steps

With this agreement in hand the ECON Committee will be able to start the Trilogue and reconcile the version of the EU Commission and EU Council, most likely from January 2019 with the aim to be in time to close the file before the European elections in the spring of next year.

This marks a step towards a new cross-border distribution environment, for which the asset managers have to prepare.

How Deloitte can help

We believe that Deloitte’s proposed assistance and expert teams would add significant value to help you to get ready for the new regulation:

1. “Pre-marketing”

  • Dos and donts re. pre-marketing activities for both the sales team and another one dedicated to the marketing/compliance team : i.e. provision of practical triggers/tips that will help client to determine if an activity will fall under pre-marketing or marketing activity that will require a notification for distribution
  • How to edit promotional communication falling is scope of a pre-marketing activity? Review of material and provisions of recommendations for improvement 
  • Assistance with the notification of pre-marketing to EU regulators

2. Cessation of marketing (de-notification)

  • Analysis of impacts (in terms of costs and information to make available to local investors) for the new regime for cessation of marketing per country (maintenance of local agent and facilities to remaining investors)

3. Ongoing watch of any regulatory developments regarding the review in progress of UCITS and AIFMD and impacts analysis

Please do not hesitate to ask for more information or to share with us your comments about our cross-border distribution service.


Alice Lehnert
Director – Regulatory Consulting
Tel: +352 45145 2605

Marie-Anne Mandroux
Senior Manager – Financial
Industry Solutions
Tel: +352 45145 2234

Benoit Sauvage
Director – RegWatch,
Strategy and Consulting
Tel : +352 45145 4220

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