No C 75/10 Official  Journal  of the European  Communities 26. 3. 77 
Opinion  on the proposal  for a Council  Directive  for the coordination  of laws,  regulations 
and administrative  provisions  regarding  collective  investment  for transferable  securities 
The text  referred  to the  Committee  has  been  published  in Official  Journal  of the 
European  Communities  No  C 171  of 26 July  1976,  page  1. 
A. LEGAL  BASIS  FOR  THE  OPINION 
On 12 May  1976  the Council  referred  the abovementioned  proposal  to the  Economic 
and Social  Committee  in accordance  with  Article  198  of the  Treaty  establishing  the 
European  Economic  Community. 
B. OPINION  OF  THE  ECONOMIC  AND  SOCIAL  COMMITTEE 
The Economic  and  Social  Committee  prepared  its opinion  on the above  matter  at its 
146th  plenary  session,  held  in Brussels  on 23 and  24 February  1977. 
The full  text  of the opinion  is as follows: 
THE  ECONOMIC  AND  SOCIAL  COMMITTEE, 
Having  regard  to the request  for an opinion  made  by 
the Council  of the  European  Communities  on 12 
May  1976; 
Having  regard  to  Article  198  of  the  Treaty 
establishing  the European  Economic  Community, 
Having  regard  to the decision  taken  by the Bureau  of 
the Committee  on  13  May  1976,  instructing  its 
Section  for Industry,  Commerce,  Crafts  and  Services 
to draw  up an opinion  and  a report  on the matter, 
Having  regard  to the opinion  issued  by its Section  for 
Transport  and  Communications  at its meeting  of 2 
February  1977, 
Having  regard  to the  report  submitted  by  the 
rapporteur,  Mr De Bruyn, 
Having  regard  to the discussion  at its 146th  plenary 
session,  held  on 23 and  24 February  1977  (meeting  of 
23 February), 
HAS  ADOPTED  THE  FOLLOWING  OPINION 
by unanimous  vote: The Committee  approves  the proposal,  subject  to the 
comments  set out below: 
1. Specific  comments 
1.1. At  present,  the  regulations  governing  unit 
trusts  in the various  common  market  countries  vary 
considerably.  Some  countries,  namely  Germany, 
Belgium,  France,  Ireland  and  the  United  Kingdom, 
have  laws  specifically  relating  to the  legal  structure 
and operation  of  these  collective  investment 
undertakings  for  transferable  securities  (CIUTS). 
Although  Luxembourg  has no law  in the real  sense  of 
the word  on CIUTS,  these  are governed  by rules  in 
the form  of circulars  with  features  all their  own, 
based  on German  and  Belgian  law.  With  a long 
tradition  behind  them,  the  Netherlands  have  no 
special  laws  on  CIUTS.  The  same  applies  to 
Denmark  and  Italy. 
1.1.1.  It  should  also  be noted  that  foreign  CIUTS 
are subject  to special  laws  in Germany. 
1.1.2.  The  aim  of the  proposed  Directive  is 
twofold,  viz.  to protect  savers,  and  to align  the 
competitive  conditions  under  which  CIUTS  operate 
within  the  Community.  There  is no doubt  that  the 
proposed  Directive  will  enable  progress  to be made 
towards  these  aims.  There  are,  nevertheless, 
reservations  about  the application  of some  of its key 
provisions. 
26. 3. 77 Official  Journal  of the European  Communities No C 75/11 
1.2.0.  The  Member  States  may  apply  to CIUTS 
situated  within  their  territory  requirements  which  are 
stricter  than,  or additional  to, those  laid  down  in 
Articles  5 et seq.  of the Directive,  provided  that  such 
requirements  are  of a general  nature  and  do not 
conflict  with  the provisions  of the Directive.  The  snag 
is in the expression  'situated  within  their  territory'.  In 
fact,  CIUTS  not situated  in a country's  territory  are 
not subject  to any  stricter  or additional  requirements 
laid down  by that  country,  but only  to the provisions 
applicable  in their  country  of origin.  It should  be 
pointed  out  that  the  country  in  which  the 
management  of a CIUTS  is effectively  carried  on is 
deemed  to be the country  in which  it is situated. 
1.2.1.  Since  CIUTS  authorized  in the  country  in 
which  they  are  situated  are  also  automatically 
authorized  in all the Member  States  (Article  5 (1)),  it 
is clear  that  CIUTS  situated  in a country  having  only 
minimum  rules  are  at an advantage  vis-a-vis  unit 
trusts  situated  in countries  in which  stricter  or 
additional  requirements  are  applicable.  If too  much 
use is made  of this  provision  by one  or more  Member 
States,  the principles  of equal  competition  aimed  at 
by the Directive  will  without  any  doubt  be distorted. 
It will  then  certainly  be  impossible  to ensure 
Community-wide  protection  and  greater  uniformity 
of safeguards  for savers. 
1.2.2.  The  Committee  hopes  that  the  authorities 
will make  as little  use as possible  of this  opportunity, 
so that  alignment  can,  to some  extent,  come  about 
voluntarily  as regards  the rules  concerning  CIUTS  in 
the different  Member  States. the same  time  as the present  one,  so that,  through  the 
two together,  the  Community's  desired  objective  of 
freedom  of movement  can be attained. 
1.4. There  will  be no reduction  of the differences 
between  the  marketing  rules  in force  in the 
Community  countries  since  CIUTS  marketing  their 
units  in another  Community  country  will  always  be 
subject  to the  rules  applicable  in that  country.  An 
inventory  should  be  made  in each  Community 
country  of  marketing  rules  which  (a)  apply 
specifically  to CIUTS  and  (b)  are  of more  general 
scope  and  apply  to the  markting  of securities  in a 
wider  context.  Publishing  such  an inventory  would 
be very  valuable  to those  who  wanted  to know  what 
rules  were  in force  and  see  that  CIUTS  in other 
Member  States  were  not discriminated  against  in any 
way.  The  Committee  wonders  whether  the 
Commission  could  not  envisage  submitting  a 
Directive  on the marketing  of securities,  although  this 
should  not,  of course,  delay  the  present  proposal 
coming  into  force. 
1.5. In  trying  to cover  the greatest  possible  number 
of types  of CIUTS,  the Directive  has become  less  than 
clear-cut.  Account  had  to be taken  of the  features 
peculiar  to CIUTS  of the corporate  type  and  of those 
peculiar  to those  of the  non-corporate  type.  In 
addition,  it was  unfortunately  thought  desirable  to 
include  certain  CIUTS  of a mixed  type.  This  has 
certainly  not  made  the present  proposal  any  clearer. 
1.2.3.  The  proposed  coordination  of  laws  is 
therefore  not  certain  to regularize  conditions  of 
competition  and  bring  about  greater  inter-penetration 
of the capital  markets  in the Community. 
1.3.0.  Even  if the  Directive  did  bring  about 
complete  freedom  of movement  for securities  through 
rules  ensuring  equal  conditions  of competition, 
freedom  of movement  might  still  be impeded  by 
other  national  rules  and  regulations,  e.g.  foreign 
exchange  regulations  or tax  provisions.  Therefore, 
the Directive  will  not  be  fully  effective  until  a 
Directive  liberalizing  capital  movements  has  been 
implemented. 
1.3.1.  The  Committee  notes  that  such  a Directive 
is being  prepared  and  hopes  it will  be implemented  at 1.5.1.  The  Committee  notes  that  the  proposed 
Directive  will  not  fully  achieve  the  objectives  at 
which  the Commission  is aiming,  especially  because 
of the many  possibilities  the Member  States  are given 
of laying  down  special  rules  and  the  numerous 
exceptions  that  are specified  in the Directive  itself. 
1.5.2.  But,  having  said  this,  the Committee  is also 
aware  of the  difficulties  encountered  in drafting  the 
present  proposal,  bearing  in mind  the  need  to take 
account  of existing  circumstances.  Any  Directive  that 
did not do this  would  certainly  distort  situations  that 
had evolved  over  many  years.  The  Committee  has 
therefore  restricted  its specific  comments  and  has 
simply  voiced  those  views  that  it thinks  will  best 
contribute  towards  achieving  the  goals  of free 
movement  and  equal  competition. 
No C 75/12 Official  Journal  of the European  Communities 26. 3. 77 
2. Specific  comments 
Article  1 (3) 
2.1. The  Committee  would  refer  here  to its above 
general  comments. 
Article  2 (1) 
2.2. Fixing  a percentage  limit  enables  CIUTS  that 
do not wish  to be covered  by the proposed  Directive 
to escape  it by  staying  below  this  limit.  The 
Committee  therefore  proposes  that  any  reference  to a 
specific  percentage  should  be deleted. 
2.2.1.  The  Committee  is strongly  of the  opinion 
that the present  Directive  should  have  referred  only 
to CIUTS  investing  in transferable  securities  and 
liquid  assets,  with  all types  of mixed  funds  being 
covered  by a later  Directive.  The  Committee  takes 
note of the Commission's  declaration  that,  although 
the present  Directive  is to apply  to mixed  unit  trusts 
right  away,  freedom  of movement  for them  would  be 
prohibited  during  an initial  stage. 
Article  2 (2) (b) 
2.3. The  Committee  notes  that  this  paragraph  only 
covers  CIUTS  that,  indirectly,  are  real  estate 
companies. 
Article  3 
2.4. This  Article  must  be  read  together  with 
Article  7(1). 
2.4.1.  The  effect  of these  two  provisions  is that  the 
status  of the  management  company  is governed  by 
the CIUTS;  at a secondary  level,  where  the CIUTS  is 
in effect  managed,  the management  company  must,  at 
any event,  have  an establishment  in that  country. 
2.4.2.  This  may  give  rise  to  problems  of 
interpretation.  As it is preferable  to have  a text  that 
is clear  and  unequivocal,  the  Committee  therefore 
proposes  that  Article  3 should  be changed  to read: 
'For the purpose  of this  Directive,  a CIUTS  shall 
be deemed  to be situated  in the  Member  State 
where  the unit  trust  management  company  or the 
investment  company  has its registered  office.' Article  6 
2.5. To  make  this  Article  clearer,  it is proposed  to 
re-word  it to read: 
'A unit  trust  shall  be composed  of three  entirely 
separate  entities  (i) the  capital  raised,  (ii)  a 
management  company  and  (iii)  a depositary 
company.  For  the  purpose  of this  Directive,  the 
term  "unit  trust"  may  be used  to refer  to any  one 
of these  three  entities  according  to  the 
circumstances.' 
Article  7.2 
2.6. The  Committee  notes  that  certain  minimum 
rules  should  be required  by the national  authorities. 
Article  10 
2.7. The  purpose  of the  management  company  is 
to manage  the trust's  assets  and  it is considered  to be 
qualified  to do  so.  It has  to judge  whether  an 
investment  is suitable  or not.  Even  if it seeks  advice 
from  other  persons  or bodies,  it is ultimately 
responsible  for the decisions  it takes. 
2.7.1.  It  is not the job of the depositary  company 
to appraise  investments  selected  by the management 
company.  The  involvement  of  the  depositary 
company  in the  management  and  adminstration  of 
the trust's  assets  could  be  interpreted  as  an 
infringement  of the management  company's  power  of 
independence  in taking  decisions. 
2.7.2.  While  account  should  be taken  of present 
structures,  the Committee  would  like  the management 
company  to be made  really  independent  in the future. 
2.7.3.  The  duties  of the  depositary  company 
concern  only  the securities  entrusted  to its care. 
2.7.4.  The  duties  described  in Article  10 (2) (b) and 
(c) are  consistent  with  this.  It is logical  that  the 
depositary  company  should  refuse  to carry  out  the 
instructions  of the management  company  when  these 
do not  comply  with  the  law  or the  fund  rules, 
because  the  depositary  bank  — together  with  the 
management  company  and  the  unit  holders  — is a 
party  to the management  contract. 
2.7.5.  To  clarify  Article  10  (2), especially 
paragraph  2 (a), the  Committee  proposes  that  the 
subparagraphs  to be rearranged,  Nos  (b)  to (f), 
26. 3. 77 Official  Journal  of the  European  Communities No C 75/13 
would  become  Nos  (a) to (e) and  the present  No (a) 
would  become  No (f) worded  as follows: 
'(f) taking  all  other  measures  to ensure  the 
day-to-day  administration  of  the  unit  trust's 
assets,  for whose  custody  it is responsible,  in 
accordance  with  the  appropriate  laws  and 
regulations.' Article  25 (1) (c) should  therefore  be supplemented  to 
read: 
.. appropriate  authorities,  and  newly  issued 
securities  other  than  those  officially  quoted  on a 
stock  exchange,  provided  that  a request  is made 
within  three  months  of issue  for the said  securities 
to be given  an official  quotation.' 
2.7.6.  In  point  (f) of the  German  version  of the 
Commission  document,  the  word  'Dividenden' 
(dividends)  should  be replaced  by 'Ausschiittungen' 
(distributions). 
Article  15 
2.8. It  is stated  here  that  only  the  management 
company  and  unit  holders  have  any  claim  on a trust's 
assets.  But  others,  such  as the  depositary  company 
(charges  for safe  custody)  and  brokers  (commission), 
require  reimbursement.  The  Committee  therefore 
proposes  that  Article  15 should  read: 
'The  assets  of a unit  trust  may  not  be the subject 
of any  claims  whatsoever  except  those  with 
respect  to charges  payable  from  these  assets  by 
express  order  of the  law,  the  fund  rules  or a 
regulation  issued  by a public  authority.' 
Article  19 
2.9. This  Article  describes  the  tasks  and 
responsibilities  of  the  depositary  company  re-
sponsible  for  custody  of the  assets  of investment 
companies.  While  bearing  in mind  the  special 
position  of investment  companies,  the  Committee 
thinks  that  Articles  10 and  19 should  be aligned  as 
far as possible,  the same  with  respect  to both  a unit 
trust  (Article  10) and  an investment  company  (Article 
19). 
Article  25 (1) (c) 
2.10.  While  accepting  that  a certain  degree  of 
caution  should  be exercised  with  respect  to stock 
exchanges  outside  the  common  market,  the 
Committee  proposes  that  approval  of a stock 
exchange  by the  appropriate  authorities  should  still 
be required,  but  investments  could  be made  in new 
issues  not  yet officially  quoted  on a stock  exchange 
providing  that  it was  proved  that  quotation  was  to be 
requested  within  three  months.  Such  proof  could  be 
furnished  by producing  a prospectus,  for  instance. Arfzc/e  26 
2.11.  It  should  be  a matter  of  course  for 
investments  to be permitted  in securities  issued  by a 
Member  State  or by public  international  organizations 
to which  Member  States  belong.  It is therefore  pro-
posed  that  Article  26 (3) should  read: 
'The  limits  laid  down  in paragraphs  1 and  2 shall 
not be applicable  in respect  of securities...' 
(rest unchanged). 
Article  30 
2.12.  While  previous  Articles  already  contain  a 
number  of derogations  from  the general  investments 
principles  laid  down  at the beginning  of Articles  25, 
26, 27 and  29, Article  30 allows  further  derogations 
from  some  Articles  referred  to above.  One  may  well 
ask just  how  much  the proposed  Directive  will  align 
rules  for managing  a CIUTS. 
2.12.1.  All  too  often  reference  is made  to the 
powers  possessed  by  the  appropriate  national 
authorities  under  the proposed  Directive.  No attempt 
is made  to set up an over-rigid  framework  within 
which  CIUTS  in the Member  States  are to develop. 
But one  should  remember  the all too numerous  cases 
where  Member  States'  national  authorities  are allowed 
to exercise  their  discretion  in deciding  exceptions  to 
the basic  rule.  It goes  without  saying  that  in such  a 
situation  the commercial  attractiveness  of a unit  trust 
to investors  will  often  depend  on the position  adopted 
by the  appropriate  authorities.  By  allowing  one 
exception  after  another,  the authorities  will  be able 
to give  unit  trusts  under  their  jurisdiction  extremely 
special  characteristics  distinguishing  them  sharply 
from  CIUTS  in other  Member  States. 
2.12.2.  The  Committee  therefore  proposes  that  the 
reference  to Article  26 (2),  which  itself  permits  a 
derogation  from  Article  26 (1),  should  be deleted. 
2.12.3.  The  Committee  also  thinks  that  the  10% 
rule at the  end  of this  Article  is certainly  not  the 
best solution.  It therefore  proposes  the following  text: 
No C 75/14 Official  Journal  of the European  Communities 26. 3. 77 
'1. The  limits  provided  for in Articles  25 (2),  26 
(1) and  27 (1) and  (2) may  be exceeded  on the 
condition  that  any  such  excess  stems  from  price 
variations  in the assets  of the CIUTS,  the exercise 
by the  CIUTS  of subscription  rights  relating  to 
securities  making  up its assets,  or from  a con-
traction  in size  by the CIUTS. 
2. As  long  as these  limits  continue  to be 
exceeded,  the  CIUTS  may  not  acquire  any 
securities  of the type  for which  the limit  has been 
exceeded. 
3. If  exceeding  the  limits  referred  to in 
paragraph  1 results  from  a contraction  in size  of 
the CIUTS,  an end  must  be put  to such  excess 
within  a reasonable  period  of time.' 
Article  31 (3) 
2.13.  It  is stated  here  that  a CIUTS  is not obliged 
to publish  a half-yearly  report  if the annual  report  for 
that financial  year  is published  within  two  months. 
For practical  reasons,  and  since  it cannot  be denied 
that publishing  an annual  report  inevitably  involves 
a great  deal  of administrative  work,  it is proposed 
that a deadline  of three  months  should  be given. 
Article  34 
2.14.  This  Article  allows  the  appropriate 
authorities  to grant  a derogation  with  respect  to the 
particulars  given  in Schedules  A and  B. 
2.14.1.  The  Committee  thinks  that  there  should  be 
no derogation  as far as information  is concerned  and 
that Article  34 (a) and  (b) should  be deleted. 
Article  38 
2.15.  As  regards  publishing  the annual  report  in an 
official  gazette  and  in order  to avoid  an accumulation 
of publication  expenses  (brochure  + official  gazette), 
it is proposed  that,  if necessary,  the official  gazette 
should  simply  state  that  the annual  report  has  been 
published  and  where  it may  be obtained.  A third 
paragraph  should  therefore  be inserted,  worded  as 
follows: 
'The  appropriate  authorities  in the Member  States 
may require  CIUTS  active  in their  countries  to 
mention  that  their  annual  report  has  been 
published,  together  with  the  place  where  the 
report  may  be obtained,  in the  official  gazette of each  Member  State  where  the  units  of the 
CIUTS  are distributed.' 
Article  46 
2.16.  The  German  version  of this  Article  should 
refer  to 'Anteile'  instead  of 'Anteilscheine'. 
Article  47 (2) 
2.17.  Article  47 (2)  states  that  notwithstanding 
paragraph  1,  the  appropriate  authorities  may 
authorize  a CIUTS  to make  short-term  loans  to 
businesses  of up to 5% of the value  of its assets.  The 
Committee  considers  that  such  operations  fall outside 
the field  of activities  of a CIUTS  and  that  Article  47 
(2) should  therefore  be deleted.  Short-term  investments 
and similar  operations  would,  of course,  still  be 
authorized  in accordance  with  Article  25 (1) (d). 
Article  48 
2.18.  The  wording  of this  Article,  concerning 
'particularly  speculative  transactions',  is not clear  and 
may give  rise  to different  interpretations.  It is very 
difficult  to define  what  is meant  by 'particularly 
speculative  transactions',  and  it would  be better  to list 
the operations  that  CIUTS  are not undertake.  But  for 
practical  reasons  it would  be impossible  to draw  up 
such a list.  To avoid  any  confusion,  it is proposed 
that this  Article  be worded  as follows: 
'A CIUTS  shall  not carry  out  uncovered  dealings 
in transferable  securities.' 
Article  49 (2) 
2.19.  This  paragraph  allows  CIUTS  to carry  out 
transactions  outside  the markets  if the prices  involved 
are 'more  advantageous'  for its unit  holders.  It seems 
logical  to allow  such  transactions  if prices  are equal 
to those  on the official  market. 
2.19.1.  Article  49 (2) should  therefore  read: 
'... carried  out  at  a price  which  is  as 
advantageous  or  more  advantageous  for the unit 
holders  ...' (rest  unchanged). 
Article  54 (2) 
2.20.  This  paragraph  lays  down  that  a CIUTS 
marketing  its units  in a member  country  other  than 
that in which  it is domiciled  must  possess  financial 
facilities  in that  country  through  which  unit  holders 
26. 3. 77 Official  Journal  of the  European  Communities No C 75/15 
may exercise  their  rights.  To understand  this  para-
graph  properly,  it should  be pointed  out  that  the 
expression  'exercise  their  rights'  is not to be taken  in 
its strict  legal  sense  but  as the exercise  of financial 
rights  attached  to units  in the  CIUTS,  such  as the 
right  to receive  a dividend  or redeem  one's  units. 
Article  57 
2.21.  This  states  that  documents  and  information 
published  in a Member  State  by a CIUTS  situated  in 
another  Member  State  must  comply  with  the  rules 
and procedures  laid  down  in that  other  Member 
State.  Such  a rule,  like  several  other  basic  rules  in the 
proposed  Directive,  may  be  an obstacle  to real 
integration  and  equality  as regards  the marketing  of 
a CIUTS'  units  in the various  Member  States. 
2.21.1.  To  ensure  that  the  rules  regarding 
documents  to be distributed  are  also  aligned,  and 
bearing  in mind  the  Committee's  comments  on 
Article  34, it is proposed  that  Article  57 (1) and  (2) 
should  be replaced  by the following: 
'If a CIUTS  markets  its units  in a Member  State 
other  than  that  in which  it is situated,  it shall 
distribute  in the other  Member  State,  in at least 
one official  language  of the other  Member  State, 
prospectuses,  annual  reports  and  half-yearly 
reports,  in accordance  with  Article  32 (1) to (3).' 
2.21.2.  If  the new  version  of Article  57 is adopted, 
Article  1 (2) would  have  to be changed  to read  as 
follows: 
'Subject  to provisions  relating  to the movement  of 
capital  and  to Articles  55 (1),  57 and  61 (2) of 
this Directive  . .(rest  unchanged). 
Article  60 
2.22.  Since  requests  other  than  applications  for 
authorization  may  have  considerable  economic  im-
portance,  this  Article  should  be extended  in scope  to 
cover  all  requests  subject  to authorization.  It is 
therefore  proposed  that  Article  60 (1) should  read: 
'... reasons  for all refusals'  and  that  the words  'for 
authorization'  in Article  60 (3) should  be deleted. 
Articles  63, 64 and 65 
2.23.  These  Articles  contain  specific  provisions 
relating  to investment  companies  which  market  their 
units  exclusively  through  one  or  more  stock 
exchanges.  Such  provisions  have  been  laid  down  to 
extend  the  scope  of the  Directive  to cover  such 
investment  companies. 2.23.1.  The  Committee  welcomes  the fact  that  the 
proposed  Directive  is to be applicable  to as many 
CIUTS  as possible,  but it notes  that  a third  category 
of CIUTS  has  been  created,  covered  by special  rules 
that differ  considerably  from  those  applying  to other 
types  of CIUTS. 
2.24.  Schedule  A 
Section  3.2.  (Information  concerning  the Depository 
Company) 
2.24.1.  The  content  of contracts  with  deposit 
banks  is of no interest  to the  saver  (as has  already 
been  pointed  out  above).  Generally  speaking,  the 
saver  is unable  to pass  judgement  on deposit  banks' 
contracts,  and  in any  case  such  contracts  are 
submitted  to supervisory  authorities  and  verified  by 
them.  Information  concerning  the  depositary 
company  should  therefore  be deleted. 
Section  4.2 
2.24.2.  The  Committee  takes  note  of  the 
Commission  representative's  declaration  that  this  is 
only meant  to refer  to external  advisers  having 
contractual  links  with  a CIUTS. 
2.25.  Schedule  B 
I. (a) Transferable  securities 
2.25.1.  The  Section  notes  that  not  all the criteria 
listed  here  are  necessary;  only  one  or more  are 
needed. 
3. Conclusion 
3.1. While  the  proposed  Directive  may  be 
considered  as  a step  forward  towards  the 
coordination  of the  laws  at present  in force  in the 
Community,  the Committee  regrets  that  it does  not 
fully  achieve  the  objectives  mentioned  in  the 
Explanatory  Memorandum,  namely  (i) to improve 
conditions  of competition,  (ii) to standardize  as far as 
possible  the obligations  imposed  on CIUTS,  (iii)  to 
abolish  restrictions  on the  free  movement  of units 
and (iv)  to ensure  a better  interpenetration  of the 
capital  markets. 
3.2. It  will  be difficult  to attain  these  objectives 
through  applying  the  proposed  Directive  in its 
present  form. 
No C 75/16 Official  Journal  of the  European  Communities 26. 3. 77 
3.3. The  three  main  obstacles  to achieving  these 
objectives  are: 
(1) The  rule  in Article  1 (3)  that  the  appropriate 
authorities  may,  if they  wish,  impose  stricter 
rules  on  CIUTS  situated  within  their  territory 
than  those  laid  down  in the Directive; 
(2) The  weakening  of the  Directive  through  the 
possibility  of  the  appropriate  authorities 
derogating  from  the  basic  rules,  for  examples  of 
which  one  need  only  refer  to Articles  25 to 30; 
(3) The  lack  of standardization  of the  rules  regarding 
information  to be published  by CIUTS  marketing 
their  units  in a Member  State  other  than  their 
own  (see  present  version  of Article  57 (1)). 
Done  at Brussels,  23 February  1977. 3.4. To  sum  up then: 
1. restrictions  on the  free  movement  of units  will,  to 
a large  extent,  be removed,  inasmuch  as other 
barriers,  such  as those  in the  field  of monetary 
policy,  are also  abolished; 
2. the  Directive  still  does  not  create  fully  the 
conditions  for  standardizing  the  obligations 
imposed  on CIUTS. 
3.5. The  Committee  asks  that  the  Directive  be put 
into force  as soon  as possible.  Once  the  Directive  is 
in force  it may  be revised  in the light  of experience  so 
as to bring  about  the  maximum  degree  of integration 
possible  in the area  covered  by it. 
The Chairman 
of the Economic  and  Social  Committee 
Basil  de FERRANT1 
ANNEX 
to the opinion  of the Economic  and  Social  Committee 
The following  amendment  was  rejected  during  the discussion. 
Insert  the following  new  paragraph  between  paragraphs  2.11  and  2.12. 
''Article  27 
The Section  considers  that  the limitation  in Article  27 is not  in the saver's  interest.  There 
is a chance  that  if a CIUTS  is allowed  to invest  any  of its assets  in units  issued  by another 
CIUTS  this  may  lead  to an undesirable  concentration  of economic  power.  The  Section 
therefore  thinks  that,  a CIUTS  should  not be allowed  to invest  in another  CIUTS.' 
Reasons 
The proposed  Directive  generally  allows  too many  exceptions  to the general  rules.  This  Article 
is an example. 
Any interpenetration  of CIUTS  is undesirable  because  of the  danger  of forming  an economic 
power  centre  and  manipulating  savers'  interests. 
Voting: 
For: 20, against:  53, abstentions:  3.