On 18 December 2012, the European Securities and Markets Authority ("ESMA") issued guidelines on exchange traded funds ("ETFs") and other UCITS issues (the "Guidelines").
The Guidelines have been published to highlight the information that investors should receive in respect of ETFs and index-tracking UCITS. The Guidelines also provide for specific rules that must be applied where UCITS enter into over-the-counter financial transactions and efficient portfolio management techniques. In addition, the Guidelines deal with the types of financial indices into which UCITS are permitted to invest.
As of 18 December 2012, a two month period commenced during which competent authorities must confirm their compliance with the Guidelines to ESMA. Explanations must be provided where provisions of the Guidelines are not adhered to.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
