Undertakings for Collective Investment in Transferable Securities (UCITS)—essentials

The following Financial Services practice note provides comprehensive and up to date legal information covering:

  • Undertakings for Collective Investment in Transferable Securities (UCITS)—essentials
  • What is a UCITS fund?
  • Definition and requirements of a UCITS fund
  • UK implementation of the UCITS regime
  • UK UCITS—legal forms
  • The EU UCITS regulatory framework
  • The Original UCITS Directive
  • UCITS III
  • UCITS IV
  • UCITS V
  • More...

Undertakings for Collective Investment in Transferable Securities (UCITS)—essentials

BREXIT: 11pm (GMT) on 31 December 2020 (‘IP completion day’) marked the end of the Brexit transition/implementation period entered into following the UK’s withdrawal from the EU. Following IP completion day, key transitional arrangements come to an end and significant changes begin to take effect across the UK’s legal regime. This document contains guidance on subjects impacted by these changes. Before continuing your research, see: Brexit and financial services: materials on the post-Brexit UK/EU regulatory regime and Impact of Brexit: UCITS—quick guide.

This Practice Note explores key elements of the Directive 2009/65/EC, as amended (Undertakings for Collective Investment in Transferable Securities (UCITS) Directive), including the UCITS regulatory framework, authorisation process, operating UCITS on a cross-border basis, UCITS management companies, master-feeder structures, depositaries, remuneration, investment information and UK implementation.

What is a UCITS fund?

UCITS funds are authorised open-ended investment funds which can be marketed to retail investors throughout the EU, provided that they meet the requirements for example regarding diversification and permitted investments set out in the UCITS Directive. UCITS funds must be managed and domiciled in the EU, but there is also a UK UCITS regime, which is covered in more detail in Practice Note: Impact of Brexit: UCITS—quick guide.

Definition and requirements of a UCITS fund

Article 1 of Directive 2009/65/EC (the UCITS Directive) defines a UCITS as an undertaking which

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