Within the boundaries of the existing legal framework of the acquis communautaire of the UCITS Directive, the guidelines have tried to address several of the requests for simplification of the cross border notification process, proposed by markets participants.
The following key issues were raised during the second consultation and the improvements to the text of the guidelines made as a result and agreed by CESR are highlighted below:
- UCITS can submit the notification letter in a language common in the sphere of international finance to the Host competent Authority where this is not contrary to the domestic legislation or regulations;
- Once a complete notification has been filed, the notification procedure should not exceed the two-month period and possibly reduced as an average to a shorter period. The Host Member State Authority shall inform the UCITS about the incompleteness and missing information and documents as soon as possible and in any case, within one month from the date of the receipt of the incomplete notification;
- As suggested by the respondents during the second consultation, in order to simplify the practices and reduce costs, competent Authorities will rely on self-certification of copies of original attestations by the notifying UCITS, the original attestation should include an English version to be provided by the UCITS.
- Regarding new sub-funds, which are added to the umbrella fund with the intention to be marketed in the Host Member State, where the marketing arrangements are already familiar to the Host country competent Authority, CESR has agreed that the necessary time for the Host Authority to check should be significantly less than the two-month period. To simplify the processing by the Host competent Authority of the notification of umbrella funds with a large numbers of sub-funds to be marketed, CESR recommends that umbrella funds with a large number of sub-funds should have one full prospectus.
The Chairman of CESR Expert Group on Investment Management and Chairman of, CONSOB Mr Lamberto Cardia noted:
“I believe that CESR's guidelines represent a significant improvement after the first and second consultations. In the guidelines, there is a commitment by the CESR Members to evaluate the functioning of the notification mechanism within two years. I am convinced that the monitoring of compliance by the Members will therefore be part of the next crucial step to ensure that these newly adopted guidelines delivers in reality a tangible improvement to the notification procedure. We expect this review of implementation to begin during the second half of 2007”.