26. 7. 76 Official  Journal  of the European  Communities No C 171/1 
II 
(Preparatory  Acts) 
COMMISSION 
Proposal  for  a Council  Directive  for  the  coordination  of laws,  regulations  and 
administrative  provisions  regarding  collective  investment  undertakings  for transferable 
securities 
(Submitted  by the Commission  to the Council  on 29 April  1976) 
THE  COUNCIL  OF THE  EUROPEAN  COMMUNITIES, 
Having  regard  to the  Treaty  establishing  the 
European  Economic  Community  and  in particular 
Article  57 (2), 
Having  regard  to the proposal  from  the Commission, 
Having  regard  to the  opinion  of the  European 
Parliament, 
Having  regard  to the opinion  of the Economic  and 
Social  Committee, 
Whereas  under  the  Treaty  any  discriminatory 
treatment  based  on  nationality  concerning 
establishment  and  provision  of services  is prohibited 
since  the  end  of the  transitional  period;  whereas 
Council  Directive  of 28 June  1973  on the abolition 
of restriction  on  freedom  of establishment  and 
freedom  to provide  services  in respect  of self-
employed  activities  of banks  and  other  financial 
institutions^1)  considered  that  the obligation  for a 
company  intending  to carry  on the  activity  of 
manager  or trustee  of a unit  trust  in another 
Member  State  to be incorporated  in that  State  comes 
within  the scope  of this prohibition; 
Whereas  the laws  of the Member  States  relating  to 
collective  investment  undertakings  differ  appreciably 
from  one State  to another,  particularly  as regards  the 
extent  of the  obligations  and  controls  which  are 
imposed  upon  these  undertakings;  whereas  these 
differences  disturb  competitive  conditions  between 
C1) OJ No L 194,16.  7.1973,  p. 1. undertakings  and  do  not  ensure  equivalent 
protection  for unitholders; 
Whereas  national  laws  governing  collective 
investment  undertakings  should  be coordinated  with 
a view  to  approximating  the  conditions  of 
competition  between  these  undertakings  at 
Community  level,  at the  same  time  ensuring  the 
effective  and  more  uniform  protection  of unit-
holders;  whereas  it seems  that  such  coordination 
would  also  facilitate  access  by CIUTS  situated  in one 
Member  State  to activities  in the  other  Member 
States; 
Whereas  the  attainment  of these  objectives  is 
essential  for the removal  of restrictions  on the free 
circulation  of  units  of  collective  investment 
undertakings  in the  Community,  and  consequently 
this coordination  falls  within  the idea  of the creation 
of a European  capital  market; 
Whereas  to achieve  these  objectives,  provision  should 
be made  for  common  basic  rules  concerning  the 
authorization,  supervision,  structure,  activities  and 
information  for  collective  investment  undertakings 
situated  in the  Member  States  which  they  must 
publish; 
Whereas  the application  of these  common  rules  is a 
sufficient  guarantee  to  collective  investment 
undertakings  situated  in a Member  State  to permit 
them,  subject  to provisions  relating  to movements  of 
capital,  to market  their  units  in other  Member  States 
without  these  Member  States  being  able  to make  the 
undertakings  or their  units  subject  of any  provision 
whatsoever  other  than  regulation  for  marketing; 
whereas  nevertheless  if a CIUTS  in one  markets  its 
units  in a different  Member  State  it should  provide  a 
No C 171/2 Official  Journal  of the European  Communities 26. 7. 76 
financial  service  in that  other  Member  State  to allow 
unitholders  therein  to easily  exercise  their  financial 
rights; 
Whereas,  firstly,  the coordination  of the  laws  of 
Member  States  should  be confined  to collective 
investment  undertakings  other  than  these  which  are 
'closed'  which  invest  exclusively  in securities; 
whereas,  on account  of the various  problems  raised 
by collective  investment  undertakings  which  do not 
invest  exclusively  in securities  and  these  which  are 
closed,  these  should  be coordinated  at a later  date, 
HAS  ADOPTED  THIS  DECISION: 
SECTION  I 
GENERAL  PROVISIONS  AND  FIELD  OF 
APPLICATION 
Article  1 
1. Member  States  shall  apply  the  provisions  of 
this Directive  to collective  investment  undertakings 
for transferable  securities  ('CIUTS')  situated  within 
their  territories. 
2. Subject  to the  provisions  relating  to the 
movement  of capital  and  to Articles  55 (1) and  61 
(2) of this  Directive,  a Member  State  shall  not apply 
any provisions  whatsoever  to CIUTS  situated  in 
another  Member  State  or to the units  issued  by such 
CIUTS. 
3. Member  States  shall  apply  stricter  requirements 
to CIUTS  situated  within  their  territories  than  those 
provided  in Article  5 et seq of this  Directive  and any 
additional  requirements,  provided  these  are  of 
general  application  and  do not  conflict  with  the 
provisions  of this Directive. 
Article  2 
1. For  the purposes  of this  Directive,  CIUTS  are 
hereby  defined  as investment  companies  and  unit 
trusts: 
— whose  object  is the collective  investment,  mainly 
in transferable  securities  and  liquid  assets,  of 
capital  acquired  by means  of offer  to the public 
and whose  operations  are based  on the principle 
of spreading  the  investment  risk.  'Investment 
mainly  in transferable  securities  and  liquid assets'  is hereby  defined  as the  investment  in 
such transferable  securities  and  liquid  assets  of 
at least  80 °/o of the capital  collected, 
— whose  units  are or have  been  issued  continuously 
or in blocks  at short  intervals  and/or  have  been 
directly  or indirectly  repurchased  or redeemed  at 
the request  of the holder,  at the expense  of the 
assets  of such  undertakings. 
2. For  the purposes  of this  Directive  the following 
shall  not be deemed  to be CIUTS: 
(a) closed  investment  companies; 
(b) CIUTS  whose  assets  are mainly  invested  other 
than in transferable  securities  and  liquid  assets 
through  the medium  of subsidiary  companies. 
Article  3 
For the purposes  of this  Directive,  a CIUTS  shall  be 
deemed  to be situated  in the Member  State  in which 
its business  is effectively  carried  on. 
Article  4 
For the  purposes  of this  Directive,  the  following 
definitions  shall  apply: 
(a) investment  company: 
CIUTS  with  a corporate  structure,  i.e., 
established  as a company; 
(b) unit  trusts: 
CIUTS  with  a non-corporate  structure; 
(c) management  company: 
the company  entrusted  with  managing  a unit 
trust; 
(d) depositary  company: 
the company  entrusted  with  custody  of the assets 
of a unit  trust  or investment  company; 
(e) fund  rules: 
all the  contractual  rules  or  'trust  rules' 
governing  the existing  local  relationships,  within 
the framework  of a unit  trust,  between  the 
management  company,  the  depositary  company 
and the unitholders; 
(f) unit: 
any material  representation  of unitholders'  rights 
in CIUTS  assets,  whether  such  rights  take  the 
form  of shares  issued  by the CIUTS  or by the 
registration  of the unitholders  in a register  kept 
by the CIUTS; 
26. 7. 76 Official  Journal  of the European  Communities No C 171/3 
(g) directors: 
persons  who  by virtue  of the law  or the articles 
or memorandum  of association  represent  the 
management,  investment  or depositary  company, 
or who  have  assumed  managerial  responsibilities 
at a senior  level; 
(h) competent  authorities: 
those  in the Member  States  in which  the CIUTS 
is situated. 
SECTION  II 
AUTHORIZATION  OF THE  CIUTS 
Article  5 
1. A  CIUTS  shall  not conduct  operations  unless  it 
has been  authorized  by the  competent  authorities. 
Such  authorization  shall  be valid  for all the Member 
States. 
2. A  unit  trust  shall  only  be authorized  if the 
competent  authorities  have  approved  the 
management  company,  the fund  rules  and  the choice 
of depositary  company.  An  investment  company 
shall  only  be authorized  if the competent  authorities 
have  approved  both  the articles  and  memorandum  of 
association  and  the choice  of depositary  company. 
3. The  competent  authorities  shall  not authorize  a 
CIUTS  if the directors  of the management  company, 
the investment  company  or the  depositary  company 
are not of good  repute  or are not competent  to carry 
out their  duties.  The  names  of the  directors  of the 
management  company,  the investment  company,  and 
their  successors  in  office  should  therefore  be 
reported  immediately  to the  competent  authorities. 
The same  shall  apply  to directors  of the  depositary 
company,  unless  such  notification  has  already  been 
given  to other  authorities  of the  Member  State  in 
which  the CIUTS  is situated. 
4. The  management  company  or  depositary 
company  shall  only  be replaced  and  the  fund  rules 
or memorandum  or articles  of association  of the 
investment  company  shall  only  be amended  with  the 
approval  of the competent  authorities. 
5. Any  amendment  of  the  memorandum  or 
articles  of association  of the  management  company 
should  be reported  immediately  to the  competent 
authorities. SECTION  III 
OBLIGATIONS  REGARDING  THE  STRUCTURE  OF 
UNIT  TRUSTS 
Article  6 
For the purposes  of this  Directive  a unit  trust  shall 
be deemed  to include  a management  company  and  a 
depositary  company  in addition  to the  capital 
accumulated. 
Article  7 
1. The  management  company  shall  have  its 
registered  office  in the Member  State  where  the unit 
trust  is situated,  or shall  be established  there  if its 
registered  office  is in another  Member  State. 
2. The  management  company  shall  have  sufficient 
paid up capital  to enable  it to carry  out its activities 
effectively  and meet  its liabilities. 
Article  8 
The activities  of the management  company  shall  be 
limited  to the management  of unit  trusts. 
Article  9 
1. The  management  company  shall  inform  the 
competent  authorities  of the names  of all its partners 
and the  amounts  of their  respective  holdings  in the 
company. 
2. Shares  in the management  company  may  only 
be sold  or otherwise  disposed  of with  the approval 
of the  competent  organs  of  the  management 
company. 
Article  10 
1. The  safekeeping  of transferable  securities  and 
liquid  assets  which  form  part  of the assets  of the unit 
trust  shall  be the  responsibility  of the  depositary 
company  which  shall  hold  them  in a separate 
account.  This  rule  shall  also  apply  to all other  assets 
of the unit  trust  whose  safekeeping  can be assured  to 
a great  extent  by the depositary  company. 
No C 171/4 Official  Journal  of the European  Communities 26. 7. 76 
2. The  depositary  company  shall  moreover  have 
the following  duties: 
(a) taking  all necessary  measures  to ensure  the day-
to-day  administration  of the unit  trust's  assets  of 
which  it is the trustee; 
(b) taking  all necessary  measures  to ensure  that  the 
sale,  issue,  repurchase,  redemption  and  the 
cancellation  of units  by the  unit  trust  is carried 
out in accordance  with  statutory  provisions  and 
fund  rules; 
(c) taking  all necessary  measures  to ensure  that  the 
value  of the  units  is calculated  in accordance 
with  statutory  provisions  and,fund  rules; 
(d) carrying  out  the  instructions  of the  management 
company  relating  to the  assets  of the  unit  trust, 
unless  these  are  not  in accordance  with  the  law 
or the fund  rules; 
(e) taking  all necessary  measures  to ensure  that: 
— securities  sold  on behalf  of the  unit  trust  are 
handed  over  only  in return  for  payment  of 
their  equivalent  value  and  that  such  equivalent 
value  is entrusted  to its custody, 
— payment  for  the  securities  purchased  on 
behalf  of the  unit  trust  is made  only  on the 
handing  over  of the  securities,  and  that  their 
custody  be  entrusted  to  the  depositary 
company  to the  extent  that  their  safekeeping 
can be substantially  assured  by it; 
(f) taking  all  necessary  measures  to ensure  that 
distributions  are  made  in accordance  with  the 
procedures  laid  down  in the fund  rules. towards  unitholders  shall  be  direct  or  indirect 
through  the  management  company  depending  on the 
legal  nature  of  the  relationship  between  the 
depositary  company  and  the  unitholders.  Clauses  in 
the fund  rules  or any  other  agreement  which  may 
exclude  or restrict  this  liability  shall  have  no effect. 
Article  13 
1. The  same  company  shall  not  act  as 
management  company  and  depositary  company. 
2. The  management  company  and  the  depositary 
company  shall  act,  in carrying  out  their  respective 
roles  in the  unit  trust,  in the  sole  interest  of the 
unitholders. 
Article  14 
1. The  terms  and  conditions  of replacement  of the 
management  company  and  the  depositary  company 
shall  be laid  down  by statute  or by fund  rules.  The 
statutory  provisions  shall  provide  that  the competent 
authorities  shall  demand  the  replacement  of the 
management  company  or the  depositary  company 
when  these  bodies  are no longer  capable  of carrying 
out: their  duties. 
2. The  statutory  provisions  or fund  rules  shall 
provide  regulations  to ensure  the  protection  of the 
unitholders  where  the  management  company  or the 
depositary  company  is replaced. 
Article  11 
1. The  depositary  company  shall  either  have  its 
registered  office  in the  same  Member  State  as the 
unit trust,  or be established  in, or at least  have  a 
place  of business  in that  Member  State  if it has  its 
registered  office  in another  Member  State. 
2. The  depositary  company  shall  have  sufficient 
paid  up capital  to enable  it to perform  its duties 
effectively  and meet  its liabilities. 
Article  12 
The depositary  company  shall  be  liable  to the 
management  company  and  the  unitholders  for  all 
loss suffered  by them  as a result  of its failure  to 
carry  out  or properly  execute  its duties.  Liability Article  15 
The assets  of a unit  trust  shall  not  be made  the 
subject  of any  claim  from  persons  other  than  the 
management  company  and  the unitholders. 
In all cases  claims  by the  management  company  or 
the unitholders  shall  only  be met  by assets  of the 
unit trust  where  there  are charges  expressly  attaching 
to these  assets  by statute  or according  to the  fund 
rules. 
Article  16 
Member  States  shall  take  measures  to ensure  that  the 
assets  of a unit  trust  are protected  if the management 
Company  or the  depositary  company  goes  into 
liquidation. 
26. 7. 76 Official  Journal  of the European  Communities No C 171/5 
SECTION  IV 
OBLIGATIONS  REGARDING  THE  STRUCTURE  OF 
INVESTMENT  COMPANIES  AND  THEIR 
DEPOSITARY  COMPANIES 
Article  17 
The investment  company  shall  have  sufficient  initial 
paid up capital  to enable  it to carry  on its business 
effectively. 
Article  18 
The investment  company  shall  not  engage  in 
activities  other  than  those  referred  to in Article  2. It 
shall  be responsible  for the management  of its assets. 
Article  19 
1. The  safekeeping  of transferable  securities  and 
liquid  assets  forming  part  of the  assets  of an 
investment  company  shall  be the responsibility  of a 
depositary  company  which  must  hold  them  in 
separate  accounts.  This  rule  shall  also  apply  to all 
other  assets  of  the  investment  company  the 
safekeeping  of which  can  be guaranteed  to a great 
extent  by the depositary  company. 
2. The  depositary  company  shall  moreover  be 
responsible  for the following: 
(a) taking  all necessary  measures  to ensure  the day-
to-day  administration  of  the  investment 
company's  assets  of which  it is the trustee; 
(b) taking  all necessary  measures  to ensure  that 
the sale,  issue,  repurchase,  redemption  and 
cancellation  of units  by the investment  company 
is carried  out  in accordance  with  statutory 
provisions  and  with  the  memorandum  and 
articles  of  association  of  the  investment 
company; 
(c) taking  all necessary  measures  to ensure  that: 
— securities  sold  on behalf  of the  investment 
company  are handed  over  only  in return  for 
payment  of the  equivalent  value  which  shall 
then be entrusted  to its safekeeping, 
— payment  for securities  purchased  on behalf  of 
the investment  company  shall  be made  only 
when  these  securities  are  handed  over,  the 
custody  of the  latter  being  entrusted  to the 
depositary  company  to the  extent  that  their 
safekeeping  can be substantially  assured  by it; (d) taking  all necessary  measures  to ensure  that 
dividends  are  issued  in accordance  with  the 
procedures  laid  down  in the  memorandum  and 
articles  of association  of the investment  company. 
Article  20 
1. The  depositary  company  shall  either  have  its 
registered  office  in the same  Member  State  as that  of 
the investment  company,  or be established  in or at 
least  have  a place  of business  in that  Member  State  if 
it has its registered  office  in another  Member  State. 
2. The  depositary  company  shall  have  sufficient 
paid up capital  to enable  it to carry  on its business 
effectively  and to meet  its liabilities. 
Article  21 
1. The  depositary  company  shall  act in the  sole 
interest  of the unitholders  in its role  as a depositary 
company. 
2. The  depositary  company  shall  be liable  to the 
investment  company  for all loss  suffered  by the latter 
as a result  of its failure  to carry  out  or properly 
execute  its duties.  Any  agreement  which  may  exclude 
or restrict  this liability  shall  have  no effect. 
Article  22 
The same  company  shall  not  act  as investment 
company  and  depositary  company. 
Article  23 
1. The  terms  and  conditions  of replacement  of the 
depositary  company  shall  be laid  down  by  the 
relevant  statute  or the memorandum  and  articles  of 
association  of the investment  company.  The  statute 
shall  provide  that  the  competent  authorities  shall 
demand  the replacement  of the depositary  company 
when  this  body  is no longer  capable  of carrying  out 
its duties. 
2. The  statute  or the memorandum  and  articles  of 
association  of the investment  company  shall  provide 
regulations  to ensure  the  protection  of unitholders 
where  the depositary  company  is replaced. 
Article  24 
Member  States  shall  take  all measures  necessary  to 
ensure  that  the assets  of an investment  company  are 
protected  if the  depositary  company  goes  into 
liquidation. 
No C 171/6 Official  Journal  of the  European  Communities 26.7.76 
SECTION  V 
OBLIGATIONS  CONCERNING  THE  INVESTMENT 
POLICY  OF CIUTS 
Article  25 
1. The  assets  of CIUTS  shall  consist  solely  of : 
(a) transferable  securities  admitted  to official  stock 
exchange  quotation  in a Member  State  and 
also those  recently  issued  transferable  securities 
in the same  category  as those  already  admitted  to 
official  quotation,  provided  that  the admission  of 
the new  transferable  securities  to  official 
quotation  is applied  for; 
(b) transferable  securities  traded  on  another 
regulated  market  of a Member  State  which 
operates  regularly  and  is recognized  and  open  to 
the public; 
(c) transferable  securities  admitted  to official  stock 
exchange  quotation  in a non-Member  State  or 
traded  on another  regulated  market  of a non-
Member  State  which  operates  regularly  and  is 
recognized  and  open  to the public,  provided  that 
the choice  of this  stock  exchange  or market  has 
been  approved  by the competent  authorities; 
(d) liquid  assets,  including  letters  of credit  which, 
due to their  rapid  maturity  and  their  guaranteed 
realisation,  rank  as liquid  assets. 
2. However: 
(a) a CIUTS  may  invest  a maximum  of up to 10 °/o 
of its assets  in transferable  securities  other  than 
those  referred  to in paragraph  1; 
(b) Member  States  shall  provide  in their  legislation 
that CIUTS  may  invest  a maximum  of up to 5 °/o 
of their  funds  in assets  other  than  transferable 
securities  and  liquid  assets. 
Article  26 
1. A  CIUTS  shall  not  invest  more  than  5 % of its 
assets  in transferable  securities  issued  by the  same 
body. 
2. Member  States  shall  raise  the limit  laid  down  in 
paragraph  1 hereof  to a maximum  of 10 °/o only  if 
the total  value  of the  transferable  securities  held  by 
the CIUTS  in the  issuing  body  in which  it invests 
more  than  5 ®/o of its assets  does  not exceed  40 °/o of 
the value  of these  assets. 
3. Member  States  shall  waive  application  of 
paragraphs  1 and  2 hereby  in the  case  of securities 
issued  or guaranteed  by a Member  State  or its local authorities  or  securities  issued  by  public  inter-
national  organizations  of which  one  or more  Member 
States  are members. 
Article  27 
1. A  CIUTS  shall  not  invest  more  than  10%  of 
its assets  in units  issued  by other  CIUTS. 
2. Without  prejudice  to paragraph  1 hereof  a unit 
trust  shall  not  invest  more  than  5 ®/o of its assets  in 
the units  of other  unit  trusts  managed  by the  same 
management  company  as its own,  but  should  this 
arise,  the  charging  of  further  costs  shall  be 
prohibited. 
3. Subject  to paragraph  2 hereof,  if a CIUTS  does 
invest  part  of its assets  in the  units  of another 
CIUTS,  any  charging  of further  costs  shall  be shown 
in the  periodical  reports  referred  to in Article  31 
hereof. 
Article  28 
A CIUTS  shall  not  invest  its assets  in securities  of a 
collective  investment  undertaking  which  is not 
defined  as a CIUTS  for  the  purposes  of this 
Directive.  This  rule,  however,  shall  not  apply  to 
securities  issued  by a closed  investment  company. 
Article  29 
1. A  CIUTS  shall  not  hold  more  than  5 % of the 
securities  of the  same  category  in an issuing  body, 
and shall  not  dispose  of more  than  5 % of the  total 
votes  attaching  to the  securities  of this  issuing  body 
by way  of vote. 
2. Member  States  shall  authorize  the  competent 
authorities  to raise  the  limits  provided  for  in 
paragraph  1 hereof  to a maximum  of 10  °/o in 
exceptional  cases. 
3. Member  States  shall  waive  application  of 
paragraphs  1 and  2 hereof  in the following  cases: 
(a) transferable  securities  issued  or guaranteed  by a 
Member  State  or  its  local  authorities  or 
transferable  securities  issued  by  public 
international  organizations  of which  one  or more 
Member  States  are members; 
(b) the  holdings  of  a CIUTS  in  a company 
incorporated  in a non-Member  State  which 
invests  its assets  mainly  in securities  of issuing 
bodies  having  their  registered  office  in that 
country,  under  whose  legislation  such  a holding 
26. 7. 76 Official  Journal  of the European  Communities No C 171/7 
establishes  the only  way  the CIUTS  can  invest  in 
the securities  of the  issuing  bodies  in that 
country.  This  waiver  shall,  however,  only  apply 
where  the  company  in the  non-Member  State 
adheres  to the limits  laid  down  in Articles  26 (1), 
27 and  29 (1) hereof  in its investment  policy. 
Where  the limits  set in Articles  26 (1) and  27 are 
exceeded,  Article  30  shall  apply  mutatis 
mutandis; 
(c) the  holdings  of  a CIUTS  in  subsidiary 
companies  carrying  on  the  business  of 
management,  investment  or marketing  on its own 
behalf. 
Article  30 
The limits  laid  down  in Articles  25 (2),  26 (1) and 
(2) and  27 (1) and  (2) may  be exceeded  on condition 
that any  such  excess  stems  from  price  variations  in 
the assets  of the  CIUTS,  or the  exercise  by the 
CIUTS  of  subscription  rights  attaching  to the 
securities  which  form  its assets,  or from  any  restraint 
on the part  of the CIUTS,  and  on condition  that  the 
total  value  of this  excess  is not  more  than  10%  of 
the value  of the assets  of the CIUTS. 
SECTION  VI 
OBLIGATIONS  CONCERNING  INFORMATION  TO 
BE SUPPLIED  TO UNITHOLDERS 
A. Publication  of a prospectus  and  periodical  reports 
Article  31 
1. The  CIUTS  shall  publish: 
— a prospectus  and  two  half-yearly  reports,  each 
financial  year, 
— an annual  report. 
2. The  annual  and  half-yearly  reports  shall  be 
published  from  the end  of the period  to which  they 
refer  within  the following  time  limits: 
—• four  months  for the annual  report, 
— two  months  for the half-yearly  report. 
3. By  way  of derogation  from  paragraph  1 hereof, 
the CIUTS  shall  not  be obliged  to publish  the half-
yearly  report  relating  to the second  six-month  period 
of the  financial  year  if the  annual  report  for  that 
financial  year  is published  during  the  two-month 
period. Article  32 
1. The  prospectus  shall  contain  the  information 
provided  for in Schedule  A annexed  to this  Directive. 
2. The  annual  report  shall  contain  the information 
provided  for in Schedule  B annexed  to this  Directive. 
3. The  half-yearly  report  shall  contain  the 
information  provided  for  in Chapters  I and  II of 
Schedule  B annexed  to this  Directive. 
If the  CIUTS  distributes  dividends  during  the  first 
half of a financial  year,  the  half-yearly  report 
relating  to the period  during  which  this  distribution 
is made  shall  also  include  the information  provided 
for in Chapter  III of Schedule  B annexed  to this 
Directive,  concerning  the  revenue  account  for  the 
reference  period. 
Article  33 
1. The  fund  rules  or the  memorandum  and 
articles  of association  of the  investment  company 
which  are an integral  part  of the prospectus  shall  be 
annexed  thereto. 
2. The  documents  mentioned  in paragraph  1 need 
not, however,  be annexed  to the prospectus  provided 
that in each  Member  State  where  the units  are placed 
on the  market,  they  are  readily  available  to the 
public,  free  of charge,  at the places  mentioned  in the 
prospectus. 
Article  34 
By way  of derogation  from  Article  32: 
(a) the  competent  authorities  shall  permit  a CIUTS 
to dispense  with  the  publication  of certain 
particulars  provided  for  in Schedules  A and  B 
annexed  to this  Directive  where  such  particulars 
are unlikely  to affect  an assessment  of the assets, 
financial  position,  performance  and  prospects  of 
that undertaking; 
(b) where  the legislation  of a Member  State  provides 
for the detailed  regulation  of CIUTS  situated  in 
that State,  the competent  authorities  shall  permit 
such  undertakings  to  limit  the  information 
contained  in the prospectus  to data  which  is not 
regulated  by law. 
Article  35 
The essential  elements  of the  prospectus  must  be 
kept up to date. 
No C 171/8 Official  Journal  of the European  Communities 26. 7. 76 
Article  36 
1. Member  States  shall  specify  the  independent 
persons  or the  bodies  whose  duty  it is to verify  the 
financial  data  contained  in the annual  reports. 
2. Each  annual  report  shall  indicate  precisely  the 
person  or body  whose  duty  it is to verify  the 
financial  data. 
Article  37 
1. The  CIUTS  shall  submit  its prospectus  and  any 
amendments  thereto,  as well  as the annual  and  half-
yearly  reports,  for  checking  by  the  competent 
authorities,  who  shall  have  a period  of one  month  in 
which  to make  any  comments.  The  CIUTS  shall 
take these  comments  into  account.  As far  as the 
prospectus  is concerned,  this  check  must  be carried 
out prior  to publication. 
2. The  competent  authorities  shall  ensure  that  the 
prospectus  and  the  reports  do  not  contain  any 
information  or omissions  which  might  mislead  the 
public. 
Article  38 
1. The  prospectus,  the  most  recent  annual  report 
and the  subsequent  interim  report  shall  be sent  free 
of charge  to the  potential  subscriber  either  when  he 
is canvassed  or at his own  request. 
2. Moreover,  the  annual  and  half-yearly  reports 
shall  be made  available  to the public. 
B. Publication  of other  information 
Article  39 
The CIUTS  shall  make  public  the  issue,  sale, 
repurchase  or redemption  price  of its units  each  time 
it issues,  sells,  repurchases  or redeems  them,  and  at 
least  twice  a month.  The  competent  authorities  shall, 
however,  permit  a CIUTS  to reduce  the frequency  to 
once  a month  on condition  that  this  derogation  does 
not prejudice  the interests  of the unitholders. 
Article  40 
1. All  publicity  involving  an invitation  to purchase 
units  of a CIUTS  shall  indicate  that  a prospectus exists  and  the  places  where  it may  be obtained  by 
the public. 
2. A  CIUTS,  and  such  marketing  organizations 
and financial  intermediaries  as may  be convened  in 
the issue  or sale  of the  units  or their  distribution  by 
the stock  exchange,  shall  not  furnish  any 
information  likely  to influence  the assessment  of the 
units  where  such  information  is not contained  in the 
prospectus  or  the  periodical  reports  or  is not 
common  knowledge. 
SECTION  VII 
GENERAL  OBLIGATIONS  OF THE  CIUTS 
Article  41 
1. A  CIUTS  shall  not borrow. 
2. Paragraph  1 notwithstanding,  Member  States 
shall  stipulate  that  the  competent  authorities  may 
permit: 
(a) CIUTS  to borrow  funds  up to 10 °/o of the value 
of their  assets  for  the  repurchase  or redemption 
of their  units  or for  the  exercise  of subscription 
rights,  on condition  that  the  funds  borrowed  are 
repaid  within  a short  period  and  are  not  secured 
by a charge  on the assets  of the CIUTS; 
(b) investment  companies  to  borrow  funds  to 
acquire  buildings  which  are necessary  in order  to 
carry  on their  operations. 
Article  42 
1. A  CIUTS  shall,  at  the  request  of  the 
unitholder,  repurchase  or redeem  its units. 
2. Paragraph  1 notwithstanding: 
(a) a CIUTS  shall,  in cases  provided  for by statute, 
the fund  rules  or the  memorandum  and  articles 
of association  of  the  investment  company, 
suspend  the  repurchase  or redemption  of its 
units.  The  terms  and  conditions  of  this 
suspension  shall  be laid  down  in the  fund  rules 
or in the memorandum  and  articles  of association 
of the investment  company; 
(b) the  competent  authorities  shall  demand  in the 
interest  of the  unitholders  or in the  public 
interest  the  suspension  of the  repurchase  or 
redemption  of its units  by a CIUTS. 
26. 7. 76 Official  Journal  of th^ European  Communities No C 171/9 
3. In  the cases  mentioned  in paragraph  2 (a),  the 
CIUTS  shall  inform  the  competent  authorities 
without  delay  of its decision. 
Article  43 
The methods  of asset  valuation  and  the methods  of 
calculation  of the  sale  or issue  price  and  the 
repurchase  or redemption  price  of the  units  of a 
CIUTS  shall  be indicated  in the fund  rules  or in the 
memorandum  and  articles  of association  of the 
investment  company. 2. By  way  of derogation  from  paragraph  1, 
Member  States  shall  provide  that  the  competent 
authorities  may  authorize  a CIUTS  to make  loans  to 
undertakings  of up to 5 °/o of the value  of its assets, 
provided  that  these  are short  term  loans  only.  This 
authorization  shall  be given  in each  case,  and  prior 
to the making  of the loan. 
Article  48 
A CIUTS  shall  not  carry  out  transactions  of a 
speculative  nature,  such  as  open  dealings  in 
transferable  securities. 
Article  44 
1. The  income  received  by a CIUTS  shall  either 
be distributed  to unitholders  or  reinvested  in 
accordance  with  provisions  which  shall  be laid  down 
in the fund  rules  or in the memorandum  and  articles 
of association  of the investment  company. 
Distribution  of income  should  take  place  at least 
once  a year.  In the case  of reinvestment  of income, 
unitholders  shall  be informed  at least  once  a year  of 
the amount  reinvested. 
2. The  net  gains  realized  from  the  sale  of the 
assets  of the CIUTS  shall  be distributed  where  such 
distribution  is laid  down  by statute  and  is provided 
for by the  fund  rules  or the  memorandum  and 
articles  of association  of the investment  company. 
3. Unrealized  gains  shall  not be distributed. Article  49 
1. A  CIUTS  shall  only  carry  out  transactions  in 
the transferable  securities  referred  to in Article  25 (1) 
which  are or shall  be part  of its assets  on the official 
market  of a stock  exchange  or on another  regulated 
market  which  operates  regularly  and  is recognized 
and open  to the public. 
2. Paragraph  1 notwithstanding,  a CIUTS  shall 
carry  out transactions  outside  the markets  referred  to 
in that  paragraph  if they  are carried  out  at a price 
which  is more  profitable  to the unitholders  than  that 
which  might  have  been  obtained  on these  markets 
had the transaction  been  carried  out thereon. 
3. , Where  a CIUTS  carries  out transactions  in the 
securities  referred  to in Article  25 (2),  the price  on 
the basis  of which  these  transactions  are carried  out 
shall  be certified  by an expert  approved  by the 
competent  authorities. 
Article  45 
The units  of a CIUTS  shall  not be issued  unless  the 
cash equivalent  to  the  net  issue  price  is 
simultaneously  paid  into  the  funds  of the  CIUTS. 
This provision  shall  not preclude  the distribution  of 
bonus  units. 
Article  46 
All the units  of a CIUTS  shall  carry  equal  rights. 
Article  47 
1. Without  prejudice  to Article  25 (1)  (d),  a 
CIUTS  shall  neither  grant  loans  nor  act  as a 
guarantor. Article  50 
The following  persons  shall  not  act  as party  to 
transactions  effected  for the account  of a CIUTS: 
— the management  company  and  the  depositary 
company, 
— the directors  and  staff  of these  companies  or of 
the investment  company, 
— subsidiaries  of the  management  company  or 
depositary  company, 
— the investment  advisers  of the  management 
company,  the  investment  company,  or  the 
depositary  company, 
— any  persons  holding  more  than  10°/o  of the 
voting  rights  in the  management  company, 
investment  company  or depositary  company. 
They  shall  not  so act  unless  such  transactions 
concern  transferable  securities  and  have  been  carried 
out; 
No C 171/10 Official  Journal  of the European  Communities 26. 7. 76 
(a) at a price  which  is equal  to  or  more 
advantageous  for the  unitholders  than  the  price 
of the official  quotation  on the stock  exchange,  if 
the said  transferable  securities  have  been 
admitted  to quotation; 
(b) at a price  which  is equal  to  or  more 
advantageous  for  the  unitholders  than  that 
observed  on any  other  regulated  market  which 
operates  regularly  and  is recognized  and  open  to 
the public,  if the  transferable  securities  involved 
have  been  traded  on this  market; 
(c) at the  price  calculated  in accordance  with  the 
rules  laid  down  by  the  fund  rules  or the 
memorandum  and  articles  of association  of the 
investment  company  in the  case  of transferable 
securities  other  than  those  referred  to  in 
subparagraphs  (a) and  (b); 
(d) at the issue  price  to the public  for new  issues  in 
respect  of which  the depositary  company  acts  as 
an intermediary. 
Article  51 -
A CIUTS  shall  place  at the  disposal  of each 
unitholder  a document  confirming  his rights  over  its 
assets. 
Article  52 
The fund  rules  or the memorandum  and  articles  of 
association  of the investment  company  shall  indicate 
categories  of costs  chargeable  to the unitholders. 
Article  53 
1. The  competent  authorities  shall  ensure  that  the 
name  of a CIUTS  cannot  mislead  the public. 
2. Member  States  shall  take  necessary  measures  to 
prevent  undertakings  which  are  not  regarded  as 
CIUTS,  as defined  in this  Directive,  from  using^ 
names  which  might  lead  the  public  to believe  that 
those  undertakings  come  within  the  scope  of this 
Directive. 
SECTION  VIII 
SPECIAL  PROVISIONS  APPLICABLE  TO CIUTS 
WHICH  MARKET  THEIR  UNITS  IN MEMBER 
STATES  OTHER  THAN  THOSE  IN  WHICH  THEY 
ARE  SITUATED 
Article  54 
1. If  a CIUTS  intends  to market  its units  in a 
Member  State  other  than  that  in which  it is situated, it shall  inform  the competent  authorities  as well  as 
the authorities  of the  other  Member  State  of its 
intention. 
2. In  the  case  referred  to in paragraph  1, the 
CIUTS  shall  provide  in this  other  Member  State  a 
financial  service  through  which  unitholders  may 
exercise  their  rights. 
Article  55 
1. By  way  of derogation  from  Article  1 (2),  a 
Member  State  shall  apply  its  own  marketing 
regulations  to CIUTS  situated  in other  Member 
States  and  marketing  or intending  to market  their 
units  within  its territory. 
2. For  the  purposes  of paragraph  1, the  term 
'marketing  regulations'  shall  cover  the following: 
(a) the  rules  relating  to entries  in trade  registers; 
(b) the  rules  relating  to sales  promotion; 
(c) the  rules  relating  to unfair  competition; 
(d) the  rules  relating  to  canvassing  or  other 
marketing  techniques; 
(e) the rules  governing  the various  forms  of savings 
plan. 
3. The  marketing  regulations  referred  to  in 
paragraph  1 shall  be applied  in a non-discriminatory 
manner  and  shall  not  have  imposed  on  CIUTS 
situated  in other  Member  States  stricter  conditions 
than those  set out in this  Directive. 
Article  56 
A CIUTS  shall  be able  to carry  out the marketing  of 
its units  in a Member  State  other  than  that  in which 
it is situated  through  a sales  office  situated  in that 
Member  State.  The  setting  up of this  office  shall  not 
be dependent  on the  approval  of the  authorities  of 
that Member  State. 
Article  57 
1. If  a CIUTS  markets  its units  in a Member  State 
other  than  that  in which  it is situated,  it shall 
distribute  in this  other  Member  State,  in at least  one 
official  language  of the  said  Member  State,  the 
documents  and  information  which  shall  be published 
in the  Member  State  in which  it is situated,  in 
accordance  with  the  same  terms  and  conditions  as 
those  provided  for  in  the  Member  State  of 
distribution. 
26. 7. 76 Official  Journal  of the European  Communities No C 171/11 
2. By  way  of derogation  from  paragraph  1, a 
CIUTS  which  is granted  permission  in accordance 
with  Article  34 (b) shall,  if it markets  its units  in a 
Member  State  other  than  that  in which  it is situated, 
publish  in this  other  Member  State  a prospectus  in 
accordance  with  Article  32 (1). 
SECTION  IX 
PROVISIONS  CONCERNING  THE  COMPETENT 
AUTHORITIES 
Article  58 
1. Member  States  shall  designate  the  competent 
authorities  who  shall  assume  the  responsibilities 
conferred  upon  them  by this  Directive.  They  shall 
inform  the Commission  thereof  and  shall  specify  any 
sharing  responsibility. 
The competent  authorities  shall  supervise  the 
activities  of  CIUTS  situated  in  their  national 
territory,  throughout  the  Community,  and  shall,  in 
particular,  ensure  that  the  rules  laid  down  in this 
Directive  are  respected,  subject  to the  provisions  of 
paragraph  3. 
2. The  competent  authorities  referred  to  in 
Articles  5, 9 (1),  14 (1),  42 (3),  53 (1),  60 (1) and  (3), 
61 (4),  62 and  67 (3) shall  be state  authorities. 
3. If  recourse  is had  to the  power  provided  in 
Article  55 (1),  then  the  authorities  responsible  for 
supervising  the  observance  of  the  marketing 
regulations  referred  to therein  shall  be those  of the 
Member  State  in which  the units  are marketed. 
4. The  competent  authorities  shall  be granted  all 
powers,  including  those  of supervision,  necessary  to 
carry  out their  task.  In particular,  they  shall  have  the 
power  to carry  out  on-the-spot  investigations  and  to 
require  the  CIUTS  concerned  to  provide  any 
information  or documents  they  may  need  in order  to 
carry  out their  task. 
Article  59 
The competent  authorities  of Member  States  shall 
collaborate  closely  in order  to carry  out  their  task 
and shall  for  this  purpose  communicate  to each 
other  all information  requested. Article  60 
1. The  competent  authorities  shall  state  the 
reasons  behind  all decisions  rejecting  applications  for 
authorization  and  shall  communicate  these  reasons 
to the applicant. 
2. Member  States  shall  provide  for  a right  of 
appeal  at law  against  all rejections. 
3. Where  an application  for  authorization  which 
was properly  presented  has  not  been  acted  upon  by 
the competent  authorities  within  three  months  from 
the date  of receipt  thereof,  provision  shall  also  be 
made  for a right  of appeal  at law. 
Article  61 
1. Member  States  shall  specify  such  measures, 
including  the  possibility  of  withdrawal  of 
authorization,  which  the  competent  authorities 
referred  to in Article  58 (1) may  take  with  regard  to 
a CIUTS  which  has  violated  statutory  provisions, 
regulations  or administrative  actions,  or the  fund 
rules  or the memorandum  and  articles  of association 
of the investment  company. 
2. Member  States  shall  specify  such  measures 
which  the  authorities  referred  to in Article  58 (3) 
shall  take  with  regard  to a CIUTS  which  has 
violated  the  rules  laid  down  in Articles  54 (1) and 
55 (1). 
3. All  decisions  taken  by the  authorities  pursuant 
to the  preceding  paragraphs  shall  state  the  reasons 
on which  they  are based  and  shall  be communicated 
to the CIUTS. 
Member  States  shall  provide  for a right  of appeal  at 
law against  such  a decision. 
4. All  decisions  to withdraw  their  approval  shall 
be communicated  without  delay  by the  competent 
authorities  of the Member  State  in which  the CIUTS 
in question  is situated  to the authorities  of the other 
Member  States  in which  the units  of this  CIUTS  are 
marketed. 
Article  62 
1. The  winding  up of a CIUTS  shall  be carried 
out under  the  supervision  of  the  competent 
authorities  in accordance  with  the  regulations  laid 
down  by national  legislation. 
2. The  competent  authorities  shall  have  all the 
necessary  powers  in order  to ensure  that  the interests 
of unitholders  are  protected.  Without  prejudice  to 
the powers  conferred  upon  courts  in such  a matter, 
No C 171/12 Official  Journal  of the European  Communities 26. 7. 76 
Member  States  shall  authorize  the  competent 
authorities  to appoint  liquidators  or to have  them 
appointed  by the courts. 
3. The  winding  up shall  not  be carried  out  in a 
discriminatory  manner  with  regard  to unitholders 
from  other  Member  States. 3. The  transferable  securities  and  liquid  assets 
which  are  part  of the  assets  of the  companies 
referred  to in Article  63 shall  be kept  in a special 
account  at one  or more  credit  institutes.  This  rule 
shall  also  apply  to all assets  the safekeeping  of which 
can be substantially  assured  by a credit  institute. 
SECTION  X 
SPECIFIC  PROVISIONS  RELATING  TO  INVESTMENT 
COMPANIES  WHICH  MARKET  THEIR  UNITS 
EXCLUSIVELY  THROUGH  ONE  OR  MORE  STOCK 
EXCHANGES 
Article  63 
Investment  companies  which  market  their  units 
exclusively  through  one  or  more  official  stock 
exchanges  to whose  official  quotation  the  units  are 
admitted  shall  not  be required  to have  a depositary 
company  within  the meaning  of this  Directive. 
The provisions  of this  Directive  which  relate  to the 
depositary  company  and  its  managers  shall  not 
therefore  apply  to these  companies. 
Article  64 
The provisions  of Article  42 shall  not  apply  to the 
investment  companies  referred  to in Article  63. 
However,  these  companies  shall,  if necessary, 
intervene  on the  market  to prevent  the  quotation  of 
their  units  from  deviating  more  than  5 *Vo from  their 
net asset  value.  The  competent  authorities  shall  in 
exceptional  cases  exempt  these  companies  from  this 
latter  requirement. SECTION  XI 
LIAISON  COMMITTEE 
Article  66 
A Liaison  Committee  shall  be set  up at the 
Commission.  The  task  of this  Committee  shall  be: 
(a) to facilitate,  without  prejudice  to Articles  169 
and 170  of  the  Treaty,  the  harmonized 
implementation  of this  Directive  through  regular 
consultation  relating  in particular  to practical 
problems  of implementation; 
(b) to facilitate  consultation  between  Member  States 
as regards  the  stricter  or  supplementary 
requirements  and  the  marketing  rules  which  they 
are free  to apply  in accordance  with  Articles  1 (3) 
and 55 (1) of this  Directive; 
(c) to advise  the  Commission,  if necessary,  on 
additions  or amendments  to this  Directive. 
2. The  Liaison  Committee  shall  be composed  of 
representatives  of  the  Member  States  and 
representatives  of  the  Commission.  It shall  be 
presided  over  by a representative  of the Commission. 
The secretariat  shall  be provided  by the Commission. 
3. The  Committee  shall  be  convened  by  the 
chairman  either  on  his  own  initiative  or at the 
request  of one  of its members. 
Article  65 
1. The  provisions  of Articles  39 and  43 shall  not 
apply  to the  investment  companies  referred  to in 
Article  63. 
2. The  methods  of asset  valuation  and  calculation 
of the  net asset  value  of the  units  of the  companies 
referred  to in Article  63 shall  be set  out  in the 
memorandum  or articles  of association  of these 
companies.  The  net  asset  value  shall  be established 
and published  at least  twice  a week,  and  its 
calculation  must  be  certified  as correct  by  an 
independent  auditor, SECTION  XII 
TRANSITIONAL  PROVISIONS,  DEROGATIONS  AND 
FINAL  PROVISIONS 
Article  67 
1. By  way  of derogation  from  Article  8, Member 
States  shall  authorize  management  companies  to 
issue  bearer  certificates  representing  registered 
securities  of other  companies, 
26. 7. 76 Official  Journal  of the European  Communities No C 171/13 
2. Member  States  shall  authorize  management 
companies  which,  at the time  of notification  of this 
Directive,  are  also  involved  in activities  other  than 
those  provided  for  in Article  8 to continue  these 
activities  provided  they  do not  harm  the interests  of 
unitholders. 
3. If,  in the  case  referred  to in paragraph  2, the 
management  company  is a credit  institute  or an 
insurance  company,  it need  only,  notwithstanding 
Article  9 (1), inform  the competent  authorities  of the 
name  of any  shareholder  holding  a number  of 
securities  to which  are  attached  voting  rights  in 
excess  of 5 %> of the total  votes  attaching  to its own 
securities. 
4. Article  9 (2) shall  not apply  to the management 
companies  referred  to in paragraph  3. 
Article  68 
Member  States  shall  allow  CIUTS  whose  depositary 
companies  do not  comply  with  the  conditions  in 
Articles  11  (1)  and  20  (1)  at the  time  of the 
notification  of this  Directive  a period  of five  years 
from  the date  of entry  into  force  of this  Directive  to 
comply  with  these  conditions. may be increased  under  the  conditions  set out  in 
Article  30. 
Article  70 
1. Articles  41 and  46 shall  not  apply  to CIUTS 
whose  fund  rules  or memorandum  and  articles  of 
association  included  on 1 January  1976  provisions 
enabling  loans  to be granted  for  investment  and 
which,  during  the two  years  preceding  January  1976, 
actually  made  use of these  provisions. 
2. The  fact  that  loans  may  be granted  shall  be 
clearly  indicated  in the prospectus. 
3. However,  the  amount  of the  loans  contracted 
under  paragraph  1 shall  not  exceed  15 ®/o of the 
amount  of the assets  of the CIUTS. 
Article  71 
Member  States  shall  bring  the laws,  regulations  and 
administrative  provisions  necessary  to comply  with 
this Directive  into  force  within  a period  of 12 
months  from  the  date  of its notification  and  shall 
inform  the Commission  immediately  thereof. 
Article  69 
1. Member  States  shall  authorize  CIUTS  which, 
at the  time  of the  notification  of this  Directive, 
exceed  the limits  laid  down  in Articles  26, 27 and  29 
to continue  exceeding  these  limits,  provided  that  the 
total  value  of the  resulting  excess  margins  is not 
greater  than  10%  of the  value  of the  assets  of the 
CIUTS. 
2. The  excess  margins  referred  to in paragraph  1 
relating  to the limits  laid  down  in Articles  26 and  27 Article  72 
Member  States  shall  ensure  that  the  Commission  is 
notified  of  the  text  of  essential  provisions 
subsequently  adopted  under  national  law  in the 
fields  covered  by this  Directive. 
Article  73 
This  Directive  is addressed  to the Member  States. 
No C 171/14 Official  Journal  of the European  Communities 26. 7. 76 
SCHEDULE  A 
Information  to be included  in the CIUTS  prospectus 
A. Regarding  unit  trusts  B.  Regarding  investment  companies 
Unit  trusts  in general Management  company 
1. General  data 1. General  data 1. General  data 
11. General  characteristics 11. General  characteristics 11. General  characteristics 
11.1.  Name. 11.1.  Name  or style,  registered  office 
and the principal  headquarters 
if this differs  from  the registered 
office. 11.1.  Name  or style,  registered  office 
and the principal  headquarters 
if this differs  from  the registered 
office. 
11.2.  Dates  of creation  and  of the 
first sale  of units  to the public. 
Indicate  the duration,  if limited. 11.2.  Duration,  if limited. 11.2.  Dates  of the company's  incor-
poration  and  of the  first  sale 
of units  to the public.  Indicate 
the duration,  if limited. 
11.3.  If the company  manages  other 
unit trusts  or  has  other 
business,  indication  of the other 
trusts  and  activities. 
11.4.  Indication  of the  place  where 
the fund  rules  and  periodical 
reports  may  be consulted. 11.4.  Indication  of the  place  where 
the memorandum  and  articles 
of association  and  periodical 
reports  of the  company  may 
be consulted. 
11.5.  Brief  indications  relevant  to 
unitholders  of the  taxation  of 
the fund.  Details  of whether 
deductions  are made  at source 
from  the  income  and  capital 
gains  paid  by  the  fund  to 
unitholders. 11.5.  Brief  indications  relevant  to 
unitholders  of the  taxation  of 
the company.  Details  of whether 
deductions  are made  at source 
from  the  income  and  capital 
gains  paid  by the company  to 
unitholders. 
11.6.  Accounting  and  distribution 11.6.  Accounting  and  distribution 
dates. dates. 
26. 7. 76 Official  Journal  of the European  Communities No C 171/15 
A. Regarding  unit  trusts  B.  Regarding  investment  companies 
Unit  trusts  in general Management  company 
12. Management  and  auditing 12. Management  and  auditing 
12.1.  Name  and  position  of  the 
undermentioned  persons  within 
the company,  with  details  of 
their  main  activities  outside  the 
company  (viz.  relevant  director-
ships  and  main  duties  in other 
companies): 12.1.  Name  and  position  of  the 
undermentioned  persons  within 
the company,  with  details  of 
their  main  activities  outside  the 
company  (viz.  relevant  director-
ships  and  main  duties  in other 
companies): 
— members  of the  Board  of 
Directors,  the  Supervisory 
Board  and  the  Managing 
Board,  partners  and  man-
agers  and  other  persons 
responsible  for management 
at a senior  level, — members  of the  Board  of 
Directors,  the  Supervisory 
Board  and  the  Managing 
Board,  partners  and  man-
agers  and  other  persons 
responsible  for management 
at a senior  level, 
— founders,  if they  still  have 
responsibilities  vis-a-vis  the 
management  company. — founders,  if they  still  have 
responsibilities  vis-ci-vis  the 
investment  company. 
13. Company  capital 
13.1.  Paid-up  capital  plus  statutory 
and voluntary  reserves  (as per 
latest  balance  sheet). 
13.2.  In the  event  of an authorized 
capital,  indication  of  the 
amount. 
A. Regarding  unit  trusts 
13.3.  Details  of the  types  and  main  characteristics  of the 
units,  in particular: 
— the  nature  of the  right  (e.g.  real,  personal  or 
other  title)  represented  by their  unit, 
— original  securities  or  certificates  providing 
evidence  of title;  entry  in a register  or in an 
account, 
— characteristics  of the  units:  registered  or bearer. 
Indication  of denomination  in the  latter  case, 
— indication  of unitholders'  voting  rights  if these 
exist, 
— circumstances  in which  winding-up  can  be 
decided  by  the  unit  trust  and  winding-up 
procedure,  in particular  as regards  the rights  of 
unitholders. B. Regarding  investment  companies 
13.3.  Details  of the different  types  and  main  characteristics 
of the  units  and  in particular: 
— original  securities  or  certificates  providing 
evidence  of title;  entry  in a register  or in an 
account, 
— characteristics  of the  units:  registered  or bearer. 
Indication  of denomination  in the  latter  case, 
— indication  of unitholders'  voting  rights, 
— circumstances  in which  winding-up  can  be 
decided  by the investment  company  and  winding-
up procedure,  in particular  as regards  the rights 
of unitholders. 
No C 171/16 Official  Journal  of the European  Communities 26. 7. 76 
A. Regarding  unit  trusts  B.  Regarding  investment  companies 
13.4.  Indication  of stock  exchanges  or markets  where  the 
units  are quoted. 13.4.  Indication  of stock  exchanges  or markets  where 
the units  are quoted. 
14. Procedures  and conditions  of issue  of units 
14.1.  Continuous  or block  issues. 14. Procedures  and  conditions  of issue  of units 
14.1.  Continuous  or block  issues. 
14.2.  Issue  or sale  by the  unit  trust,  by a marketing 
organization,  through  an intermediary,  through  the 
stock  exchange  or another  market. 14.2.  Issue  or sale  by the  investment  company,  by a 
marketing  organization,  through  an intermediary, 
through  the stock  exchange  or another  market. 
14.3.  Number  of units  or duration  of issue. 14.3.  Number  of units  or duration  of issue. 
14.4.  Circumstances  in which  issue  or sale  may  be 
suspended. 14.4.  Circumstances  in which  issue  or sale  may  be 
suspended. 
15. Conditions  and  procedures  for  repurchase  or 
redemption  of units  and  circumstances  in which 
repurchase  or redemption  may  be suspended 15. Terms  and  conditions  for repurchase  or redemption 
of units  and  circumstances  in which  repurchase  or 
redemption  may  be suspended 
16. Outline  of distribution  rules 
16.1.  Distribution  or reinvestment  of profits. 16. Outline  of distribution  rules 
16.1.  Distribution  or reinvestment  of profits. 
16.2.  Precise  description  of methods  used  for determining 
net profit  and  sums  available  for  distribution 
(whether  capital  gains  or losses  taken  into  account, 
whether  a revenue  equalization  account  is employed, 
method  of charging  fees  and  costs). 16.2.  Precise  description  of methods  used  for determining 
net profit  and  sums  available  for  distribution 
(whether  capital  gains  or losses  taken  into  account, 
whether  a revenue  equalization  account  is employed, 
method  of charging  fees  and  costs). 
16.3.  Details  of whether  the profit  is distributed  in full 
or only  in part  and  in the latter  case  names  of the 
bodies  having  authority  to take  the  relevant 
decisions. 16.3.  Details  of whether  the profit  is distributed  in full 
or only  in part  and  in the latter  case  names  of the 
bodies  having  authority  to take  the  relevant 
decisions. 
16.4.  Form  of the distribution  of profits  (in cash  or units). 16.4.  Form  of the distribution  of profits  (in cash  or units). 
2. Business  policy 
20. Description  of business  policy  aims  and  techniques 
20.1.  Object  of the fund,  e.g.  aims  for income,  capital 
growth,  etc. 2. Business  policy 
20. Description  of business  policy  aims  and  techniques 
20.1.  Object  of the  company,  e.g.  aims  for  income, 
capital  growth,  etc. 
26. 7. 76 Official  Journal  of the European  Communities No C 171/17 
A. Regarding  unit  trusts  B.  Regarding  investment  companies 
20.2.  Orientation  of  the  fund's  investment  policy 
(particular  specialization  or spread  in geographical 
terms  or as to industry). 20.2.  Orientation  of the  company's  investment  policy 
(particular  specialization  of spread  in geographical 
terms  or as to industry). 
20.3.  Limitations  and  obligations  on investment  policy. 20.3.  Limitations  and  obligations  on investment  policy. 
20.4.  Indication  of specific  techniques,  such  as contracting 
of debts  or option  dealings  which  are permissible 
in the management  of the assets. 20.4.  Indication  of specific  techniques,  such  as contracting 
of debts  or option  dealings  which  are permissible 
in the management  of the assets. 
21. Main  rules  for valuation  of assets 21. Main  rules  for valuation  of assets 
22. Determination  of the sale  or issue  price  and  the 
repurchase  or redemption  price  of units, 
in particular: 
—• frequency  of calculation  of the  sale  or issue 
price  and  the repurchase  or redemption  price, 
— details  of charges  and  commissions  of all kinds, 
including  taxes  relating  to sales  or issues  and 
redemption  or repurchase, 
— method,  place  and  frequency  of publication  of 
these  prices. 22. Determination  of the sale  or issue  price  and  the 
repurchase  or redemption  price  of units  (*), 
in particular: 
— frequency  of calculation  of the  sale  or issue 
price  and  the repurchase  or redemption  price, 
— details  of expenses  and commissions  of all kinds, 
including  taxes  relating  to sales  or issues  and 
redemption  or repurchase, 
— method,  place  and  frequency  of publication  of 
these  prices. 
23. Remunerations  payable  to  the  management 
company,  the depositary  company  or third  parties 
by the fund  and refunds  of costs  to the management 
company,  the depositary  company  or third  parties 
by the fund. 23. Remunerations  payable  to the  directors,  the 
depositary  company  or to third  parties  by the 
company  and  refunds  of costs  to the directors,  the 
depositary  company  or to third  parties. 
(') For  the  investment  companies  referred  to in Article  63 of the  Directive,  this  heading  is hereby  replaced  by  the  following: 
22. Method  and  frequency  of calculation  of the  net  asset  value  of the  shares.  Method,  place  and  frequency  of publication  of 
this value. 
3. Information  concerning  the depositary  company  of unit  trusts  and investment  companies 
3.1. Name  or style,  registered  office  and  the principal  headquarters  if this  differs  from  the 
registered  office. 
3.2. Elements  of the contract  with  the management  company  or the investment  company  not 
arising  from  statutory  provisions,  fund  rules  or memorandum  and  articles  of association 
of the investment  company,  and relevant  to the unitholders. 
3.3. Main  activity. 
4. Information  concerning  investment  advisers  of unit  trusts  and  investment  companies 
4.1. Name  or style. 
4.2. Elements  of the  contract  with  the  management  company  or the  investment  company 
which  may  be relevant  to the unitholders. 
4.3. Other  significant  activities. 
No C 171/18 Official  Journal  of the European  Communities 26. 7. 76 
SCHEDULE  B 
Information  to be included  in the periodical  reports 
I. Statement  of assets  and liabilities 
The following  items  shall  be shown  separately: 
(a) transferable  securities. 
Particulars  of transferable  securities  shall  be given  in the  form  of a table  with  a 
separate  line  for each  different  type  of security.  Transferable  securities  must  also  be 
analysed  according  to one or more  of the following  criteria: 
— nature  of the security  (shares,  bonds  or debentures,  convertible  bonds,  etc.), 
— relevant  situation  (country  of issuer,  country  of quotation,  etc.), 
— economic  sector, 
— currency. 
For each  security  mentioned  above  the following  must  be stated: 
— number  or total  nominal  value, 
— total  value  determined  in accordance  with  the  valuation  rules  laid  down  by 
statutory  provisions,  fund  rules  or the memorandum  and  articles  of association  of 
the investment  company.  The  total  value  shall  be expressed  in the currency  of 
the CIUTS, 
— proportion  in relation  to the total  assets  of the CIUTS. 
(b) Deposits  with  banking  institutes. 
(c) Dividends  and interest  receivable,  where  not already  included  in the valuation  of assets 
under  (a), (b) and (e). 
(d) Other  amounts  receivable. 
(e) Other  assets. 
The following  particulars  shall  be given  for each  asset: 
— description  and value, 
— proportion  in relation  to the total  assets  of the CIUTS. 
(f) Loans  obtained,  indicating  the purpose,  the currency  of the loan,  the rate  of interest 
and the term. 
(g) Other  amounts  payable. 
(h) Value  of net assets. 
(i) The  number  of units  in circulation. 
II. Notes  on the statement  of assets  and liabilities 
(a) Transferable  securities  not admitted  to an official  stock  exchange  quotation  shall  be 
identified  as such. 
(b) Where  the price  used  for transferable  securities  is not an official  quotation,  the market 
referred  to or the criteria  used  for valuation  shall  be specified. 
(c) Where  the  free  negotiability  of securities  is restricted  by statutory  or contractual 
requirements,  this shall  be stated,  and  the criteria  used  for valuation  shall  be indicated. 
(d) Contingent  tax liabilities,  particularly  those  relating  to capital  gains,  shall  be mentioned, 
indicating  how  far these  taxes  have  been  taken  into  account  in determining  the position 
of the CIUTS. 
(e) Transactions  in progress  (such  as conditional  operations)  on the  date  when  the 
statement  of assets  and  liabilities  of the CIUTS  is drawn  up which  are relevant  from 
the point  of view  of assets  shall  be shown. 
26. 7. 76 Official  Journal  of the European  Communities No C 171/19 
(f) Amounts  to be received  or to be paid  by the CIUTS  under  the heading  of forward 
exchange  transactions  in progress  on the  date  when  the  statement  of assets  and 
liabilities  of the CIUTS  is established  shall  be listed  in foreign  currency;  these  amounts 
shall  be expressed  in the relevant  foreign  currency  with  an indication  of their  equivalent 
value  in the currency  of the  Member  State  where  the CIUTS  is situated.  Foreign 
currency  shall  include  currencies  other  than  those  in which  the  CIUTS  accounts 
are kept. 
III. Revenue  account  for the reference  period 
The following  items  shall  be shown  separately: 
(a) Dividends  on shares: 
— in cash, 
— in securities,  where  such  dividends  are considered  as income. 
(b) Interest  on bonds  (including  lottery  draws  and premiums). 
(c) Other  income  (including  subscription  rights,  bonus  issues  and warrants). 
(d) Appreciation  in value  where  brought  to the revenue  account. 
(e) Balance  of the revenue  equalization  account,  if such  an accounting  system  is used. 
(f) Management  costs  where  charged  to the revenue  account. 
(g) Custody  charges  where  charged  to the revenue  account. 
(h) Financial  charges  and,  in particular,  interest  paid  on loans. 
(i) Depreciation  in value  where  charged  to the revenue  account. 
(j) Taxes. 
(k) Net amount  of revenue. 
Items  falling  under  headings  (f) and  (g) shall  be apportioned,  if these  costs  are invoiced 
separately,  according  to nature  or according  to persons  making  the  charge.  An 
apportionment  shall  not  be required  when  the  CIUTS  pays  only  lump  sums  to those 
persons. 
IV. Changes  in capital  account  during  the reference  period 
The following  items  shall  be shown  separately: 
(a) Value  of net assets  at the beginning  of the period. 
(b) Total  amount  of capital  from  sale  or issue  of units  and  purchase  or redemption  of 
units. 
(c) Management  costs  where  charged  to the capital  account. 
(d) Custody  charges  where  charged  to the capital  account. 
(e) Appreciation  or depreciation  in capital  value  since  the beginning  of the period. 
(f) Value  of the net assets  at the end of the period. 
Items  falling  under  headings  (e) and  (d) shall  be apportioned,  if these  costs  are invoiced 
separately,  according  to nature  or according  to persons  making  the charge.  An apportion-
ment  shall  not be required  when  the CIUTS  pays  only  lump  sums  to those  persons. 
No C 171/20 Official  Journal  of the European  Communities 26. 7. 76 
V. Transactions  carried  out during  the reference  period  (l) 
The following  transactions  shall  be shown: 
(a) Sales  and purchases  of transferable  securities  during  the reference  period  shall  be shown 
in terms  of number  or total  nominal  value.  Where  transactions  are not the result  of a 
decision  of the CIUTS  (for  example  scrip  issues)  these  shall  be shown  separately. 
(b) For each  security  referred  to in paragraph  I (e) the gross  sale or purchase  price. 
(c) Transactions  referred  to in paragraph  II (e) which  have  been  settled  during  the period, 
unless  they  have  given  rise  to a sale  or purchase  included  in the statement  referred 
to in (a) above. 
(x) This  information  does  not  have  to be included  in the  annual  report  if it has  been  published  in the  half-yearly 
report. 
Proposal  for  a Council  Regulation  (ECSC,  EEC,  Euratom)  amending  the  Financial 
Regulation  of 25  April  1973  applicable  to the  general  budget  of the  European 
Communities 
(Submitted  by the Commission  to the Council  on 26 May  1976) 
THE  COUNCIL  OF THE  EUROPEAN  COMMUNITIES, 
Having  regard  to  the  Treaty  establishing  the 
European  Coal  and  Steel  Community,  and  in 
particular  Article  78f thereof, 
Having  regard  to  the  Treaty  establishing  the 
European  Economic  Community,  and  in particular 
Article  209  thereof, 
Having  regard  to  the  Treaty  establishing  the 
European  Atomic  Energy  Community,  and  in 
particular  Article  183  thereof, 
Having  regard  to the proposal  from  the Commission, 
Having  regard  to the  opinion  of the  European 
Parliament, 
Whereas  the Treaty  of 22 July  1975  amended  certain 
budgetary  provisions  of the  Treaties  establishing  the 
European  Communities  and  of  the  Treaty 
establishing  a Single  Council  and  a  Single 
Commission  for  the  European  Communities;  and 
whereas,  in the  light  of these  amendments,  changes 
need  to be made  to the  provisions  of the  Financial 
Regulation  relating  to the  adoption  of the  budget 
and the  measures  to be taken  if, at the beginning  of 
a budget  year,  the budget  has not yet been  adopted; 
Whereas  account  should  also  be  taken  of the 
changed  distribution  of the  powers  of the  two 
institutions  which  hold  the  budgetary  authority  by amending  the  provisions  concerning  transfers  to 
reflect  the fact  that  the  European  Parliament  makes 
the final  decision  on transfers  relating  to expenditure 
which  does  not  necessarily  result  from  the  Treaties 
or from  Acts  adopted  in accordance  therewith; 
Whereas  the  Treaty  of 22 July  1975  established  a 
Court  of Auditors  which  replaces  the  Audit  Board 
and the  Auditor  of the  European  Coal  and  Steel 
Community;  whereas  the  Court  of Auditors  should 
have  the  same  status  as an institution  in matters 
concerning  the establishment  and  implementation  of 
the budget,  and  whereas  the  provisions  covering  the 
jurisdiction  and  powers  of the  Court  of Auditors 
should  be  reviewed  once  the  Court  has  been 
constituted; 
Whereas  there  should  be conferred  upon  all  the 
institutions  the right  to apply  the practices  current  in 
some  of  the  institutions  in  respect  of  the 
implementation  of their  budgets,  and  whereas  in 
particular  all the  institutions  should  be empowered 
to effect  themselves  any  necessary  transfers  within 
their  own  budget  section;  whereas  in respect  of the 
Guarantee  Section  of the  European  Agricultural 
Guidance  and  Guarantee  Fund  the  Commission 
should  —  because  of the  requirement  that  the 
accounts  be closed  on 31 March  — be empowered  to 
carry  out  between  1 January  and  31 March  of the 
subsequent  financial  year  any  transfers  between, 
chapters  that  may  be required;  whereas,  pursuant  to 
the provisions  of Regulation  (EEC)  No 2681/74,  it is 
essential  that  the  Commission  should  be empowered 
to make  transfers  as necessary  between  chapters  of 
the Guarantee  Section  of the  European  Agricultural 
Guidance  and  Guarantee  Fund  and  the  Food  Aid 
chapter;