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ARTICLE · 25 JULY 2019

ESMA Consults On Draft Guidelines For UCITS Performance Fees

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The European Securities and Markets Authority has published a consultation paper that contains draft guidelines on the regulation of certain elements of performance fees.

LuxembourgCorporate/Commercial Law

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The European Securities and Markets Authority (ESMA) has published a consultation paper (ESMA34-39-881) that contains draft guidelines on the regulation of certain elements of performance fees applied in the realm of undertakings for collective investment in transferable securities (UCITS). With the draft guidelines, ESMA pursues the objective of aligning the interests of UCITS management companies (ManCos) and UCITS investors through establishing common criteria in the following areas:

  1. general principles on performance fee calculation methods;
  2. consistency between the performance fee model and the fund's investment objectives, strategy and policy;
  3. frequency for the crystallization of the performance fee;

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