Catagory:Distribution

1
Europe: New Funds May Apply for UK Overseas Fund Regime Recognition from September 2024
2
SEC Risk Alert Offers Initial Observations on Compliance
3
SEC Fines Adviser for Off-Channel Communications
4
Australia: Inquiry into the Wholesale Investor and Wholesale Client Tests
5
Europe: Modernisation of the PRIIPs KID Considered by European Parliament
6
SEC’s Increased Focus on “AI Washing:” Charges Announced Against Two Investment Advisers for Violations of the Marketing Rule
7
Europe: Agreement on EU ESG Ratings Regulation
8
Europe: BaFin Clarifies the German Approach to the ELTIF 2.0 Regime
9
EUROPE: UK’s Overseas Funds Regime Moves a Step Closer with Confirmation that Most EEA UCITS Will Be Deemed Equivalent
10
Europe: Responsibility of UCITS Management Companies and AIFMs for producing PRIIPs key information documents confirmed

Europe: New Funds May Apply for UK Overseas Fund Regime Recognition from September 2024

By: Áine Ní Riain, Aoife Maguire, Gayle Bowen, and Philip Morgan

The Financial Conduct Authority (FCA) has released updated information and, together with HM Treasury, a “roadmap,” on the UK’s Overseas Funds Regime (OFR). It intends to accept applications from new funds (i.e. those not in the Temporary Marketing Permissions Regime (TMPR)) from September 2024. This is a welcome development for managers of new EEA UCITS that are not currently able to access the UK retail market.

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SEC Risk Alert Offers Initial Observations on Compliance

By: Michael S. Caccese and Lance C. Dial

On 17 April 2024, the Securities and Exchange Commission (SEC) Division of Examinations issued a risk alert entitled “Initial Observations Regarding Marketing Rule Compliance” (the Alert). The Alert reflected the SEC examination staff’s preliminary observations coming from its examination program and noted that compliance with Rule 206(4)-1 (the Marketing Rule) continues to be a priority for the SEC staff.

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SEC Fines Adviser for Off-Channel Communications

By: Lance C. Dial and Pablo J. Man

On 3 April 2024 the SEC announced the first off-channel communications settlement with a registered investment adviser who was not otherwise affiliated with a broker-dealer. This settlement provides new insight into how the SEC views adviser’s recordkeeping obligations, which are narrower than broker-dealer regulatory requirements.

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Australia: Inquiry into the Wholesale Investor and Wholesale Client Tests

By: Kane Barnett and Prudence Birchall

The Parliamentary Joint Committee on Corporations and Financial Services (Committee) has commenced an inquiry into the wholesale investor test for offers of securities, and the wholesale client test for financial products and services (together, wholesale investor/client tests) in the Corporations Act 2001 (link here) (Inquiry).

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Europe: Modernisation of the PRIIPs KID Considered by European Parliament

By: Áine Ní Riain and Shane Geraghty

On 20 March 2024, the European Parliament’s Committee on Economic and Monetary Affairs (ECON) voted in favour of draft modernisation measures for the PRIIPs Key Information Document (KID).

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SEC’s Increased Focus on “AI Washing:” Charges Announced Against Two Investment Advisers for Violations of the Marketing Rule

By: Matthew Rogers and Annabelle North

Following up on its previously-issued Investor Alert warning investors on the use of so-called “AI washing” by advisers in their marketing materials, the Securities and Exchange Commission (SEC) announced on 18 March 2024 the settlements of charges against two investment advisers for “making false and misleading statements about their purported use of artificial intelligence (AI).”

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Europe: Agreement on EU ESG Ratings Regulation

By: Hilger von Livonius and Philipp Riedl

On 5 February 2024, the EU Council and the EU Parliament agreed on a provisional text for the ESG Ratings Regulation (the Regulation).

Under the Regulation, in-scope EU providers of ESG ratings will require a licence from, and be supervised by, European Securities and Markets Authority (ESMA).

In-scope ESG ratings will provide an opinion on a company’s or a financial instrument’s sustainability profile, by assessing its exposure to sustainability risk and its impact on society and the environment.

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Europe: BaFin Clarifies the German Approach to the ELTIF 2.0 Regime

By: Hilger von Livonius and Philipp Riedl

As anticipated in our earlier blog on ELTIF 2.0, Regulation (EU) 2023/606 amending the Regulation on European long-term investment funds (ELTIF Regulation) has been in force since 10 January 2024. There is a lot of hope in the German market that the revised ELTIF regime will finally help this product to achieve a breakthrough.

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EUROPE: UK’s Overseas Funds Regime Moves a Step Closer with Confirmation that Most EEA UCITS Will Be Deemed Equivalent

By: Shane Geraghty, Aoife Maguire, Andrew Massey, Philip Morgan, and Courtney Hunter

The UK’s overseas funds regime has been in development for several years and is finally close to becoming a reality. It will create a more streamlined method by which non-UK funds given “equivalence” status may be marketed to UK retail investors.

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Europe: Responsibility of UCITS Management Companies and AIFMs for producing PRIIPs key information documents confirmed

By: Áine Ní Riain and Lucy Deane

Under the EU PRIIPs Regulation “manufacturers” are required to prepare a key information document (KID) where relevant packaged retail investment products (including most funds) are made available to retail investors. 

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