International law firm Dechert LLP’s Financial Services Group published its latest DechertOnPoint report this week on current European regulatory developments.PARA_BREAK_SENTINEL_9f8e7d6c

International law firm Dechert LLP’s Financial Services Group published its latest DechertOnPoint report this week on current European regulatory developments. It finds that a recent UCITS V consultation held by the European Commission to review the current regulatory framework surrounding UCITS depositaries and the introduction of remuneration provisions on UCITS managers – so as to gather evidence on foreseen costs and benefits – was met with wide support. The initiatives are considered a step forward in improving investor protection and fair competition amongst UCITS providers. Regarding UCITS depositaries, clarification of duties and liability regime were considered a key UCITS V policy priority that needed to be aligned with AIFMD to establish regulatory consistency. Respondents to the consultation also asked for consistent terminology to be used between AIFMD and UCITS regimes. From a liability viewpoint, the key issue amongst respondents was what actually constituted an asset being “lost”. Rules on remuneration should be “adjusted to the UCITS model” said the report, with some suggesting that the rule on a portion of variable remuneration consisting of units or shares of the fund or investment company was “not suitable in a UCITS environment”. This feedback will be considered when the Commission publishes its proposals for UCITS amendments in July.