The European Union’s latest directive on undertakings for collective investment in transferable securities, known as Ucits IV, which was formalised on July 13, 2009, will take effect from July 1 this year, the deadline for transposition of the directive into the national law of EU member states. Luxembourg became the first member state to do so on December 17, 2010.

Over the past year and a half the European Commission has drawn up subsidiary legislation in the form of directives and directly applicable regulations that add detail to the legislative framework of the Ucits IV directive.

The introduction of the revised directive is intended to improve the efficiency of the European fund industry by making it easier to merge funds into bigger, more cost-effective vehicles, enabling management companies in one jurisdiction to run funds domiciled in another, and to operate master-feeder structures within the Ucits framework, as well as speeding up authorisation procedures for cross-border distribution. In addition, it aims to ensure investors are better informed through the introduction of the Key Investor Information Document.

We will continue to cover new developments in the implementation of the directive and subsidiary legislation across Europe and analyse key aspects of the new rules and their practical application in our Ucits IV blog. In the meantime, please contact us if you would like to discuss in greater detail elements any issues regarding the directive and how it may affect your business.
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