Launch of a common supervisory action on UCITS cost provision and performance
On 6 January 2021, ESMA launched a Common Supervisory Action (CSA) with the National Competent authorities on the supervision of costs and fees of UCITS in the European Union (EU) taking into account the ESMA supervisory briefing on the supervision of costs published in June 2020.
The CSA will assess supervised entities’ compliance with the cost related provisions in the UCITS framework and the obligation of not charging investors with undue costs. These obligations are part of the Union Strategic Supervisory Priorities for NCA’s by ESMA.
Furthermore, the CSA will cover entities employing Efficient Portfolio Management techniques on their adherence to ESMA Guidelines on ETFs and other UCITS issues.
The joint effort will be carried out throughout 2021 to gather and share knowledge and experience, thus ensuring greater supervisory convergence across the EU. The NCAs are required to provide their report to ESMA by 31 December 2021.
For this purpose, the CSSF, has prepared a questionnaire for UCITS management companies (“ManCos”).The questionnaire will be sent to a sample of relevant ManCos directly by email and should be completed in respect of all managed UCITS funds and sub-funds.
As from the date of availability, the qualifying entities will have one month to respond to the questions. The deadline for ManCos applying Efficient Portfolio
Management Techniques will be six weeks.