Fund Management

The European Securities and Markets Authority (ESMA) has published the responses received to its Consultation on draft guidelines on liquidity stress test for investment funds.

To view the responses, please click the button below.

The European Securities and Markets Authority (ESMA) has issued today its first annual report on sanctions imposed by national competent authorities (NCAs) under the Undertakings for Collective Investments in Transferable Securities (UCITS) Directive.

Under the UCITS Directive, NCAs can impose sanctions for the infringements of its provisions, such as on management companies, depositary as well as information provided to investors.

The report provides an aggregated overview of the penalties and measures issued under the UCITS Directive for 2016/2017, based on data submitted to ESMA by NCAs.


The UCITS Directive is a detailed, harmonised framework for investment funds that can be sold to retail investors throughout the EU. This means that funds authorised in one Member State can be marketed in another Member State using a passporting mechanism. There are more than 29,000 UCITS funds in the EU which represent over €8 trillion of assets under management. 

Steven Maijoor, the Chair of the European Securities and Markets Authority, has delivered the keynote speech at today's Better Finance 10th Anniversary Conference in Bucharest.

The speech focused on the costs and performance of retail investment products, drawing on ESMA's first annual costs and performance report on retail investment products.

​Key points in the speech were:

“In the case of retail investment funds, costs are fairly constant and not as variable as gross returns. Hence, investors take an extra hit in case of overall lower gross returns.


“The new ESMA Q&As adopt a broad definition of ‘benchmark referencing’ UCITS funds. The obligation for a wider range of funds to show past performance of the benchmark should allow investors to better evaluate investment choices of active funds against passive funds, and reduce the possibilities of adopting closet indexing strategies.”

The European Securities and Markets Authority (ESMA) has today updated its Questions and Answers on the application of the Alternative Investment Fund Managers Directive (AIFMD).

ESMA has added two new Q&As on calculation of leverage under AIFMD.

The Q&As provides clarification on:

  • the treatment of short-term interest rate futures for the purposes of AIFMD leverage exposure calculations according to the gross and commitment methods;
  • the required frequency of the calculation of leverage by an AIFM managing an EU AIF which employs leverage.

The purpose of this Q&A document is to promote common supervisory approaches and practices in the application of the AIFMD and its implementing measures.

The European Securities and Markets Authority (ESMA) has today updated its Questions and Answers (Q&As) regarding the application of the Undertakings in Collective Investments in Transferable Securities (UCITS) Directive. 

The updated Q&As clarify the UCITS KIID benchmark and past performance obligations, namely that:

Benchmark disclosure

  1. UCITS should clearly indicate, in the KIID, whether their strategy is ‘active’ (or ‘actively managed’) or ‘passive’ (or ‘passively managed’);
  2. A UCITS managed in reference to a benchmark is one where the benchmark plays a role in the management of the UCITS, for example, in the explicit or implicit definition of its portfolio composition and/or performance objectives and measures (this clarification led to repeal of an existing Q&A on past performance); and
  3. Investors should be provided with an indication of how actively managed the UCITS is, compared to its reference benchmark index.

Past performance

  1. Where funds name a target in their investment objectives and policies, the performance should be disclosed against the target, even if the comparator is not named a ‘benchmark’
  2. The performance disclosed in the KIID regarding a benchmark index should be consistent with performance disclosure in other investor communications.

The purpose of these Q&A documents is to promote common supervisory approaches and practices in the application of the UCITS Directive and its implementing measures.

ESMA will periodically review these Q&A documents and update them where required.


The European Securities and Markets Authority (ESMA) has today opened a public consultation regarding draft supervisory technical standards (RTS) under the European Long-Term Investment Fund (ELTIF) Regulation.

ESMA is seeking stakeholders’ input on its draft RTS on various subjects that are critical for the functioning of the ELTIF Regulation. The draft RTS are to determine:

  • the criteria for establishing the circumstances in which the use of financial derivative instruments solely serves hedging purposes;
  • the circumstances in which the life of an ELTIF is considered sufficient in length;
  • the criteria to be used for certain elements of the itemised schedule for the orderly disposal of the ELTIF assets; 
  • the costs disclosure; and
  • the facilities available to retail investors.

ELTIFs are designed to increase the amount of non-bank finance available for companies investing in the real economy of the European Union. They are also intended to allow investors to put money into companies and infrastructure projects for the long term. As such, ELTIFs are an important element of the efforts being put in place at European level to boost long-term investments.

The consultation is open for feedback until 29 June 2019.

Consultation on draft regulatory technical standards under Article 25 of the ELTIF Regulation

Responding to this paper  

ESMA invites comments on all matters in this paper and in particular on the specific questions summarised in Annex I. Comments are most helpful if they: 

  1. respond to the question stated; 
  2. indicate the specific question to which the comment relates; 
  3. contain a clear rationale; and 
  4. describe any alternatives ESMA should consider. 

ESMA will consider all comments received by 29 June 2019.