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

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

  • Undertakings for Collective Investment in Transferable Securities (UCITS)—essentials
  • What is a UCITS fund?
  • The UCITS regulatory framework
  • Authorisation of UCITS
  • Operating UCITS on a cross-border basis
  • Depository of a UCITS
  • UCITS management companies
  • UCITS and master-feeder structures
  • UCITS investor information
  • UCITS investment policies
  • more

BREXIT: The UK is leaving the EU on Exit Day (as defined in the European Union (Withdrawal) Act 2018). This has an impact on this Practice Note. For further guidance on the impact of Brexit on the UCITS regime, please see Practice Note: Preparing for Brexit: UCITS—quick guide.

The UCITS regime provides a set of common standards applicable across all EU Member States for the operation and cross border promotion of a form of mutual fund called an undertaking for collective investment in transferable securities (UCITS). This Practice Note introduces the key concepts of the UCITS regime, examining the form of UCITS funds and the regulatory framework in which they operate.

What is a UCITS fund?

In the UK, a UCITS fund may be organised as a collective investment scheme (CIS), an open-ended investment company (OEIC) (also known as an investment company with variable capital (ICVC)), or an authorised unit trust (AUT). For more information on these fund types, see Practice Notes: OEIC and ICVC authorisation and winding up and Authorised unit trust—operational requirements under COLL.

UCITS can be marketed to retail investors throughout the European Economic Area (EEA) and are therefore highly regulated products.

Requirements of a UCITS fund

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

  1. the sole object of collective investment