Proposal for a DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Directive 2009/65/EC of the European Parliament and of the Council and Directive 2011/61/EU of the European Parliament and of the Council with regard to cross-border distribution of collective investment funds
Date: 2018-03-12
Institutions: Directorate-General for Financial Stability, Financial Services and Capital Markets Union, European Commission
Subjects: European Securities and Markets Authority, UCITS fund, alternative investment, capital market, financial legislation, investment transaction, marketing

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   EUROPEAN COMMISSION  Brussels, 12.3.2018 COM(2018) 92 final 2018/0041 (COD)  Proposal for a DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL  amending Directive 2009/65/EC of the European Parliament and of the Council and Directive 2011/61/EU of the European Parliament and of the Council with regard to cross-border distribution of collective investment funds (Text with EEA relevance) {SWD(2018) 54} - {SWD(2018) 55}  
 
EXPLANATORY MEMORANDUM 

1. 

• 

CONTEXT OF THE PROPOSAL 

Reasons for and objectives of the proposal 

The  Commission  has  today  adopted  a  package  of  measures  to  deepen  the  Capital Markets 
Union  (‘CMU’)  together  with  the  Communication  "Completing  Capital  Markets  Union  by 
2019 – time to accelerate delivery". The package includes this proposal and a proposal for a 
regulation  on  facilitating  the  cross-border  distribution  of  collective investment  funds,  which 
also  amends  Regulations  (No)  345/20131  and  346/20132,    as  well  as  a  proposal  for  an 
enabling  EU  framework  on  covered  bonds,  a  proposal  for  an  enabling  framework  on 
European  crowdfunding  service  providers  (ECSP)for  businesses  ,  a  proposal  on  the  law 
applicable  to  the  third-party  effects  of  assignments  of  claims,  and  a  Communication  on  the 
applicable law to the proprietary effects of transactions in securities. 
This proposal amends certain provisions in Directive 2009/65/EC3 and Directive 2011/61/EU4 
with the purpose of reducing regulatory barriers to the cross-border distribution of investment 
funds in the EU. These new measures are expected to reduce the cost  for fund managers of 
going  cross-border  and  should  support  more  cross-border  marketing  of  investment  funds. 
Increased competition in the EU will help to give investors more choice and better value. 
This proposal was scheduled in the Commission Work Programme 20185 and should be seen 
in  the  broader  context  of  the  CMU  action  plan6  and  the  CMU  Mid-Term  Review7,  to 
establish a genuine internal capital market by addressing fragmentation in the capital markets, 
removing  regulatory  barriers  to  the  financing  of  the  economy  and  increasing  the  supply  of 
capital  to  businesses.  Regulatory  barriers,  namely  Member  States’  marketing  requirements, 
regulatory  fees  and  administrative  and  notification  requirements  represent  a  significant 
disincentive  to  the  cross-border  distribution  of  funds.  These  barriers  were  identified  in 
response to the Green Paper on Capital Markets Union8, the Call for Evidence on the EU 

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Regulation  (EU)  No  345/2013  of  the  European  Parliament  and  of  the  Council  of  17  April  2013  on 
European venture capital funds (OJ L 115, 25.4.2013, p. 1). 
Regulation  (EU)  No  346/2013  of  the  European  Parliament  and  of  the  Council  of  17  April  2013  on 
European social entrepreneurship funds (OJ L 115, 25.4.2013, p. 18). 
Directive  2009/65/EC  of  the  European  Parliament  and  of  the  Council  of  13  July  2009  on  the 
coordination  of  laws,  regulations  and  administrative  provisions  relating  to  undertakings  for  collective 
investment in transferable securities (UCITS), OJ L 302 17.11.2009, p. 32. 
Directive  2011/61/EU  of  the  European  Parliament  and  of  the  Council  of  8  June  2011  on  Alternative 
Investment  Fund  Managers  and  amending  Directives  2003/41/EC  and  2009/65/EC  and  Regulations 
(EC) No 1060/2009 and (EU) No 1095/2010, OJ L 174 7.7.2011, p. 1. 
Communication  from  the  Commission  to  the  European  Parliament,  the  Council,  the  European 
Economic  and  Social  Committee  and  the  Committee  of  the  Regions:  Commission  Work  Programme 
2018 An agenda for a more united, stronger and more democratic Europe. 
Communication  from  the  Commission  to  the  European  Parliament,  the  Council,  the  European 
Economic and Social Committee and the Committee of the Regions: Action Plan on Building a Capital 
Markets Union (COM(2015)468 final). 
Communication  from  the  Commission  to  the  European  Parliament,  the  Council,  the  European 
Economic  and  Social  Committee  and  the  Committee  of  the  Regions:  the  Mid-Term  Review  of  the 
Capital Markets Union Action Plan (COM(2017) 292 final). 
Green Paper: Building a Capital Markets Union, COM(2015) 63 final. 

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regulatory framework  for  financial  services9  and  the  public  consultation  on  barriers  to 
the cross-border distribution of investment funds10.  

Investment funds are investment products created with the sole purpose of pooling investors’ 
capital and investing that capital collectively through a portfolio of financial instruments such 
as  stocks,  bonds  and  other  securities.  In  the  EU,  investment  funds  can  be  categorised  as 
undertakings  for  collective  investment  in  transferable  securities  (UCITS)  and  alternative 
investment  funds  (AIFs)  managed  by  alternative  investment  fund  managers.  UCITS  are 
covered by Directive 2009/65/EC and AIFs are covered by Directive 2011/61/EU. Directive 
2011/61/EU is complemented by four fund frameworks: 

 

 

 

 

Regulation (No) 345/2013 on European venture capital funds,  

Regulation (No) 346/2013 on European social entrepreneurship funds,  
Regulation 2015/46011 on European long-term investment funds and  
Regulation 2017/113112 on money market funds.  

The  shared  purpose  of  these  rules  is  notably  to  make  cross-border  distribution  easier  while 
ensuring a high level of investor protection. 

Rules for EU investment funds allow fund managers to distribute and, with some exceptions, 
also to manage their funds across the EU. While EU investment funds have seen rapid growth, 
with  a  total  of  EUR  14 310  billion  in  assets  under  management  in  June  201713,  the  EU 
investment  fund  market  is  still  predominantly  organised  as  a  national  market:  70 %  of  all 
assets  under  management  are  held  by  investment  funds  registered  for  sale  only  in  their 
domestic  market14.  Only  37 %  of  UCITS  and  about  3 %  of  AIFs  are  registered  for  sale  in 
more than three Member States. Compared to the United States, the EU market is smaller in 
terms  of  assets  under  management.  However,  there  are  considerably  more  funds  in  the  EU 
(58 125  in  the  EU  compared  to  15 415  in  the  US)15.  This  means  EU  funds  are  on  average 
significantly  smaller.  This  has  a  negative  impact  on  economies  of  scale,  the  fees  paid  by 
investors and the way in which the internal market operates for investment funds. 

This  proposal  also  recognizes  that  there  are  other  factors  outside  the  scope  of  this  proposal 
which  hold  back  the  cross-border  distribution  of  investment  funds  in  the  EU.  These  factors 
include national tax regimes applicable to investment funds and investors, vertical distribution 
channels and cultural preferences for domestic investment products. 

• 

Consistency with existing policy provisions in the policy area 

This  proposal  is  presented  together  with  a  proposal  for  a  Regulation  on  facilitating  cross-
border  distribution  of  collective  investment  funds  and  amending  Regulations  (EU)  No 

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Communication  from  the  Commission  to  the  European  Parliament,  the  Council,  the  European 
Economic  and  Social  Committee  and  the  Committee  of  the  Regions:  Call  for  Evidence  —  EU 
regulatory framework for financial services, COM(2016) 855 final. 
https://ec.europa.eu/info/publications/consultation-cross-border-distribution-investment-funds_en. 
Regulation  (EU)  2015/760  of  the  European  Parliament  and  of  the  Council  of  29  April  2015  on 
European long-term investment funds (OJ L 123, 19.5.2015, p. 98-121). 
Regulation (EU) 2017/1131 of the European Parliament and of the Council of 14 June 2017 on money 
market funds (OJ L 169, 30.6.2017, p. 8). 
EFAMA, Quarterly Statistical Release Q2 2017. 
This  includes so-called ‘round-trip’ funds,  i.e.  where  a  manager  domiciles  a  fund  in  another  Member 
State and then distributes it only back into the market where they are based. 
EFAMA Fact Book 2017 and Investment Company Institute (ICI) Fact Book 2017. 

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345/2013 and (EU) No 346/2013. It contains amendments to certain provisions applicable to 
the  cross-border  distribution  of  investment  funds  laid  down  in  Directive  2009/65/EC  and 
Directive 2011/61/EU. Such provisions were identified as burdensome or insufficiently clear 
and  allowed  the  creation  of  additional  requirements  (‘gold  plating’)  when  they  were 
transposed  into  national  legal  systems.  These  amendments  are  consistent  with  objectives  of 
the Directives, which aim to establish a single market for investment funds and facilitate the 
cross-border distribution of investment funds. The proposal also aligns the rules between the 
different legislative frameworks for investment funds. Hence, consistency with existing policy 
provisions is safeguarded. 

• 

Consistency with other Union policies 

The Commission’s top priority is to strengthen the EU economy and stimulate investment to 
create jobs. A key element of the  Investment Plan for Europe16, which aims to strengthen 
Europe’s  economy  and  encourage  investment  in  all  28  Member  States,  is  creating  a  deeper 
single  market  for  capital  –  a  CMU.  Deeper  and  integrated capital  markets  will  improve  the 
access  to  capital  for  companies  while  aiding  in  the  development  of  new  investment 
opportunities for savers. 

This  proposal  is  complementary  to  this  objective  and  a  priority  action  in  the  CMU  mid-
term review17, as it contains measures to remove capital market barriers. It contributes to the 
development  of  more  integrated  capital  markets  by  making  it  easier  for  investors,  fund 
managers and invested undertakings to benefit from the single market. 

2. 

• 

LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY 

Legal basis 

This legislative action falls within the area of shared competence in accordance with Article 
4(2)a of the Treaty on the Functioning of the European Union (TFEU). It aims to facilitate the 
establishment  and  the  provision  of  services  with  the  single  market,  further  developing  and 
implementing the general principles of the right of establishment and the freedom to provide 
services enshrined in Articles 49 and 56 TFEU.  

This  proposal  is  based  on  Articles  53(1)  TFEU,  which  is  the  legal  basis  for  Directive 
2009/65/EC  (ex  Article  47(2)  EC)  and  Directive  2011/61/EU.  The  internal  market  for 
investment  funds  is  currently  prevented  from  operating  to  its  full  potential  by  regulatory 
barriers. Such barriers include diverging national implementation of provisions of these two 
Directives  that  make  it  difficult  for  investment  funds  to  fully  benefit  from  their  Treaty 
freedoms.  Certain  amendments  to  the  existing  rules  are  proposed  to  bring  more  clarity  and 
harmonisation where needed. These amendments aim to address the detrimental effects of the 
identified obstacles which prevent access to the market for managers who wish to offer their 
investment  funds  in  another  Member  State  by  providing  services  across  borders  or  by 
establishing  a  branch  in  that  other  Member  State.  The  proposal  suggests  aligning  the  rules 
applicable to UCITS and  AIFMs and also proposes  new measures to remove barriers to the 
cross-border distribution of funds.    

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http://eur-lex.europa.eu/legal-content/EN/TXT/?qid=1507119651257&uri=CELEX:52014DC0903 
Further initiatives also target the facilitation of cross-border investments, e.g. guidance on existing EU 
standards for the treatment of cross-border EU investments and the amicable resolution of investment 
disputes. 

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• 

Subsidiarity (for non-exclusive competence) 

This proposal complies with the principle of subsidiarity as set out in Article 5 of the Treaty 
on European Union (TEU). 

According to the principle of subsidiarity, Union action may only take place if the envisaged 
aims  cannot  be  achieved  by  Member  States  alone.  The  identified  problem,  the  existence  of 
regulatory  barriers to  the cross-border distribution of investment  funds, is  not  limited to  the 
territory of one Member State. Consequently, the proposal’s aim is to ensure that the internal 
market  for  the  services  of  investment  funds  operates  smoothly,  for  example  by  (further) 
harmonising  the  requirements  regarding  the  providing  of  local  facilities  to  investors  in  host 
Member  States.  Furthermore,  uniformity  and  legal  certainty  of  the  exercise  of  the  Treaty 
freedoms can be better ensured by taking action at EU level. 

• 

Proportionality 

This proposal complies with the principle of proportionality as set out in Article 5 TEU. The 
proposed  measures  are  necessary  to  achieve  the  objective  of  reducing  regulatory  barriers  to 
cross-border  distribution  of  investment  funds  within  the  EU.  Remaining  regulatory  barriers 
require EU action allowing for a harmonised framework, and cannot be tackled by Member 
States alone. 

The  impact  assessment  accompanying  this  proposal  contains  initial  estimations  on  cost 
savings based on factual and realistic assumptions. The proposal will reduce the compliance 
burden  and  costs  for  investment  funds  by  removing  burdensome  requirements  and  the 
unnecessary  complexity  and  legal  uncertainty  of  the  rules  that  govern  the  cross-border 
distribution  of  funds.  Consequently,  the  proposal  does  not  go  beyond  what  is  necessary  to 
tackle the issues at EU level. 

• 

Choice of the instrument 

This proposal amends Directive 2009/65/EC and Directive 2011/61/EU. Therefore, the choice 
of a Directive as an instrument for amending the existing rules laid down in the Directives is 
the most appropriate to ensure that the identified barriers are eliminated. 

The objective of the new procedures on pre-marketing and de-notification introduced by this 
proposal  is  in  line  with  the  objective  of  Directive  2009/65/EC  and  Directive  2011/61/EU, 
which is to make it easier for collective investment fund managers to access the market. These 
procedures  harmonise  divergent  practices  introduced  in  some  Member  States  in  the  areas 
which have not been harmonised. Taking into account the need for Member States to either 
supplement,  or  amend  their  national  laws  regulating  access  of  investment  fund  managers  to 
their  markets,  a  Directive  introducing  these  new  procedures  in  the  existing  EU  legal 
framework is the most appropriate choice. 

3. 

• 

RESULTS 
CONSULTATIONS AND IMPACT ASSESSMENTS 

EX-POST 

EVALUATIONS, 

OF 

STAKEHOLDER 

Ex-post evaluations/fitness checks of existing legislation 

In  preparing  this  proposal,  the  Commission  carried  out  an  in-depth  evaluation  of  relevant 
provisions  of  Directive  2009/65/EC  and  Directive  2011/61/EU  and  additional  requirements 
imposed by Member States. 

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This  evaluation  showed  that  despite  its  relative  success,  the  single  market  falls  short  of 
realising its full potential for the cross-border distribution of investment funds, since the funds 
still face many barriers. In addition, the existing legal framework does not provide sufficient 
transparency as regards the legal requirements and administrative practices which fall outside 
the  harmonisation  introduced  by  Directive  2009/65/EC  and  Directive  2011/61/EU.  The 
Commission’s evaluation revealed that Member States take very different approaches to the 
requirements and verifications of marketing communications. There is also a wide variation in 
the  fees  and  charges  levied  by  the  national  competent  authorities  for  supervisory  tasks  in 
accordance with Directive 2009/65/EC and Directive 2011/61/EU. These are all barriers to a 
wider cross-border distribution of investment funds. 

• 

Stakeholder consultations 

Responses  to  two  consultation  suggested  that  regulatory  barriers  to  the  cross-border 
distribution  of  investment  funds  prevented  the  full  benefits of  the  single  market  from  being 
realised. The first consultation, the Green Paper on Capital Markets Union, was launched 
on 18 February 2015. The second consultation, the Call for Evidence on the EU regulatory 
framework for financial services, was launched on 30 September 2015.  

Additional information on national practices was sought from competent authorities and 
the  European  Securities  and  Markets  Authority  (ESMA).  At  the  Commission’s  request, 
ESMA conducted a survey of competent authorities in 2016, requesting details about current 
national practices in areas such as regulatory fees and marketing requirements. 

Based  on  the  input  received  from  the  CMU  Green  Paper  and  the  Call  for  Evidence  and 
ESMA’s  survey,  the  Commission  launched  a  public  consultation  on  2  June  2016  on  the 
cross-border distribution of investment funds18. Given the feedback already received, the 
consultation sought practical examples of the problems faced and evidence of their impact. To 
receive  a  high  number  of  replies,  the  Commission  organised  roadshows  with  asset 
management associations and their members in the main asset management hubs in the EU, 
i.e.  Luxembourg,  France,  Ireland,  the  UK,  Germany  and  Belgium.  Several  meetings  and 
conference  calls  were  held  with  European  and  national  investor  associations,  and  the 
consultation was presented to the Financial Services User Group on 15 September 2016. In 
total,  64  responses  were  received:  52  from  associations  or  companies,  8  from  public 
authorities  or  international  organisations  and  4  from  individuals.  Most  responses  indicated 
that regulatory barriers were a significant disincentive to cross-border distribution. 

At the Commission’s request and based on the evidence received, ESMA conducted a follow-
up  survey  in  2017  to  obtain  further  information  about  specific  marketing  practices  and 
notification requirements in Member States. 

The  Commission  also  organised  meetings  with  the  investment  fund  industry  and  European 
investor  associations  for  more  information.  A  questionnaire  was  sent  on  30  May  2017  to 
eight trade bodies on the various areas covered by the cross-border distribution of investment 
funds. There was a particular focus on quantifying the costs caused by the regulatory barriers 
to cross-border distribution and determining the potential benefits of removing these barriers 
for asset managers and investors. Feedback suggested that the costs due to regulatory barriers 
are substantial: they amount to 1 to 4 % of the overall expenses of an investment fund. Also, a 
targeted  survey  of  60  equally  represented small,  medium-sized  and  large  investment  funds 

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https://ec.europa.eu/info/publications/consultation-cross-border-distribution-investment-funds_en . 

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based  on  a  randomised  stratified  sampling  procedure  was  conducted  in  October  2017.  The 
survey confirmed the relevance of the regulatory barriers and the need for action at EU level. 

The  Commission  also  consulted  stakeholders  in  June  and  July  2017  through  an  inception 
impact assessment19. The five responses received from asset managers, their associations and 
financial advisors’ associations supported the Commission initiative to reduce the barriers to 
the cross-border distribution of investment funds. 

Collection and use of expertise 

• 
The Commission relied on information and data from Morningstar20, the European Fund and 
Asset  Management  Association  (EFAMA)  and  market  reports  and  studies  by  private 
companies.  Additionally,  academic  literature  was  reviewed,  in  particular  literature  on  the 
impact of cross-border distribution on competition and expected consumer behaviour. 

• 

Impact assessment 

An impact assessment was carried out to prepare this initiative. 

On  1  December  2017,  the  Regulatory  Scrutiny  Board  delivered  a  positive  opinion  with 
recommendations to further improve the draft impact assessment report. The draft report was 
subsequently  modified  to  take  into  account  the  Board’s  comments21.  The  main  changes 
recommended by the Board related to:  

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factors that affect cross-border distribution not covered by the initiative,  

a description in the baseline of recent initiatives that have an (indirect) impact on the 
cross-border distribution of funds,  

the structure, presentation, assessment and comparison of the options, and  

the  presentation,  documentation  and  qualification  of  the  quantitative  methods  and 
their results.  

The  revised  impact  assessment  report  and  an  executive  summary  of  the  impact  assessment 
report are published with this proposal22.  

The impact assessment report considers a range of policy options. Based on their assessment, 
the policy choices are as follows: 

(a) 

(b) 

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National  marketing  requirements  should  be  more  transparent  at  national  and  EU 
level. In addition, the definition of pre-marketing in Directive 2011/61/EU should be 
harmonised, and the process of checking marketing material should be framed more 
clearly. 

Regulatory  fees  should  be  more  transparent  at  EU  level,  and  high-level  principles 
should  be  introduced  to  ensure  more  consistency  in  the  way  regulatory  fees  are 
determined. 

https://ec.europa.eu/info/law/better-regulation/initiatives/ares-2017-3132069_en. 
Morningstar is an investment research and data provider. 
The opinion of the Regulatory Scrutiny Board SEC(2018)129 final. 
The impact assessment report and the executive summary SWD(2018)54 final and SWD(2018)55 final. 

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(c) 

(d) 

The  choice  of  facilities  to  support  local  investors  should  be  left  to  managers  of 
investment funds, with safeguards for investors. 

The procedures and requirements for updating notifications and de-notification of the 
use of the marketing passport should be harmonised more. 

Together,  the  policy  choices  significantly  reduce  regulatory  barriers.  They  increase  the 
potential  to  have  more  funds  marketed  cross-border,  improve  competition,  lower  market 
fragmentation and give investors more choice in the EU. The policy choices also have indirect 
benefits  because  of  their  social  and  environmental  impact.  More  cross-border  distribution 
should  lead  to  more  opportunities  to  invest  in  investment  funds  pursuing  social  or 
environmental goals. This is turn could accelerate growth in these areas. 

For  all  investment  funds  currently  marketed  on  a  cross-border  basis  in  the  EU,  the  policy 
choices together are expected to save an annual EUR 306 to 440 million in costs (recurrent 
costs). The savings in one-off costs is expected to be even higher: EUR 378 to 467 million. 
These  cost  reductions  should  act  as  incentives  to  develop  more  cross-border  activities  and 
support a more integrated single market for investment funds. 

This Directive covers policy choices (c) and (d). The Regulation which is proposed separately 
covers policy choices (a) and (b). 

• 

Regulatory fitness and simplification 

This proposal should lead to significant cost reductions for managers of investment funds that 
distribute,  or  intend  to  distribute,  their  funds  cross-border  in  the  EU.  These  cost  reductions 
will  in  particular  have  a  positive  effect  on  managers  of  funds  who  either  manage  a  smaller 
number  of  investment  funds  or  investment  funds  with  less  significant  assets  under 
management, since they have a smaller base over which they can spread the costs. 

Although this proposal does not directly target small and medium-sized enterprises (SMEs), 
SMEs  will  indirectly  benefit  from  this  proposal.  Increased  cross-border  distribution  of 
investment  funds  will  in  fact  accelerate  the  growth  of  EU  investment  funds  and  their 
investments in SMEs, in particular from venture capital funds. 

• 

Fundamental rights 

The proposal promotes rights enshrined in the Charter of Fundamental Rights (the ‘Charter’). 
The main objective of this initiative is to facilitate the right to provide services in any Member 
State, as prescribed by Article 15(2) of the Charter, ensuring that there is no discrimination, 
even indirect, on grounds of nationality (further implementing Article 21(2) of the Charter). 
Finally, prohibition of abuse of rights, namely of the freedom to provide services, will be duly 
considered, as prescribed by Article 54 of the Charter. 

4. 

BUDGETARY IMPLICATIONS 

The proposal does not have a budgetary impact for the Commission. 

5. 

OTHER ELEMENTS 

 

Evaluation 

An evaluation of this Directive and the Regulation on facilitating cross-border distribution of 
collective  investment  funds  and  amending  Regulations  (EU)  No  345/2013  and  (EU)  No 
346/2013 will be conducted 36 months after the date for transposition of this Directive. The 

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Commission will rely on a public consultation and discussions with ESMA and the competent 
authorities. 

• 

Detailed explanation of the specific provisions of the proposal 

The proposal covers the following amendments: 

(1) 

Amendments to Directive 2009/65/EC (Article 1) 

Article 77 of Directive 2009/65/EC is proposed to be deleted. The enhanced requirements for 
the marketing communication are laid down in the proposal for a Regulation on facilitation of 
cross-border distribution of funds. These principles established for marketing communications 
will apply to all asset managers who market their funds, irrespective of their type. This change 
will  ensure  a  level  playing  field  and  the  same  level  of  investor  protection  across  Member 
States.  

Article  91(3)  of  Directive  2009/65/EC  is  proposed  to  be  deleted.  This  provision  requires 
Member  States  to  ensure  that  their  national  laws,  regulations  and  administrative  provisions 
governing cross-border marketing of UCITS within their territories are easily accessible from 
a  distance,  by  electronic  means  and  in  a  language  customary  in  the  sphere  of  international 
finance. A parallel proposal for a Regulation on the facilitation of cross-border distribution of 
funds  provides  for  specific  rules  on  the  transparency  of  national  laws  and  requirements 
applicable  to  marketing  communications  with  respect  to  all  collective  investment  funds. 
These new rules will ensure that comprehensive, clear and up-to date information is collected 
and published by ESMA. 

Article  92  of  Directive  2009/65/EC  is  proposed  to  be  amended.  This  provision  does  not 
impose the obligation on UCITS to have local facilities in each Member State where UCITS 
are  marketed.  However,  in  practice  many  Member  States  require  facilities  on  their  territory 
for making payments to unit-holders, repurchasing or redeeming units and making available 
the information which funds are required to provide. A few Member States also require these 
local  facilities  to  perform  additional  tasks,  like  handling  complaints  or  serving  as  a  local 
distributor  or  being  the  legal  representative  (including  dealing  with  the  national  competent 
authority). 

Requirements to have local facilities are costly and have limited added value given the use of 
digital technology. Therefore, this proposal bans the imposition of physical presence. While 
requiring that facilities are established in  each Member State where  marketing activities are 
carried  out  and  which  serve  situations  such  as  making  subscriptions,  making  payments  or 
repurchasing or redeeming units, this proposal allows fund managers to use electronic or other 
information  and  means  of 
means  of  distance  communication  with 
communication should be available to investors in the official languages of the Member State 
where the investor is located. 

investors.  The 

Amendments to Articles 17 and 93 of Directive 2009/65/EC aim to align national procedures 
for  changes to  the  notification  procedure  for  UCITS  across  funds  types and  across  Member 
States.  In  particular,  a  precise  time  frame  for  communicating  the  competent  authorities’ 
decisions  is  necessary  to  ensure  uniform  rules  and  make  the  procedures  applicable  to 
collective fund managers more efficient. A precise time frame is also necessary to ensure that 
procedures  governing  changes  to  the  information  provided  by  AIFMs  in  the  notification 
process are aligned with Directive 2011/61/EU.  

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A  new  Article  93a  is  added  to  Directive  2009/65/EC  to  complement  the  notification 
procedures with the conditions for UCITS who decide to stop their marketing activities in a 
Member State. Asset managers are allowed to de-notify the marketing of their UCITS only if 
a maximum of 10 investors who hold up to 1 % of assets under management of this UCITS 
have invested in this UCITS in an identified Member State. The competent authorities of the 
home  Member  State  of  this  UCITS  will  verify  the  compliance  with  this  requirement, 
including the transparency and publication requirement for investors and the repurchase offer. 
All obligations to inform will continue to apply to remaining investors after de-notification of 
the marketing activities in a Member State. 

(2) 

Amendments to AIFMD (Article 2) 

It is proposed to add a pre-marketing definition in Article 4(1) of Directive 2011/61/EU and to 
insert Article 30a laying down the conditions under which an EU AIFM can engage in pre-
marketing  activities.  It  is  important  to  provide  sufficient  safeguards  against  potential 
circumvention of the requirements of Directive 2011/61/EU that apply when marketing AIFs 
in the home Member State or across the border in another Member State. AIFM is therefore 
allowed to  test  an  investment  idea or  an investment  strategy  with  professional  investors  but 
may  not  promote  an  established  AIF  without  notification,  as  prescribed  by  the  Directive. 
Moreover,  when  professional  investors  revert  to  the  AIFMs  following  their  pre-marketing 
activities, a subscription to the units or shares of an AIF that is ultimately established or of a 
similar AIF managed by that AIFM will be considered the result of marketing. 

Article  32a  is  inserted  in  Directive  2011/61/EU  to  complement  the  notification  procedures 
with  the  procedure  and  conditions  for  AIFMs  who  wish  to  discontinue  their  marketing 
activities in a particular Member State. An AIFM can be authorised to de-notify the marketing 
of an EU AIF it manages only if there are a maximum of 10 investors who hold up to 1 % of 
assets under management of this AIF in an identified Member State. The AIFM must notify to 
competent  authorities  of  its  home  Member  State  how  it  fulfils  the  conditions  for  de-
notification  and  for  a  public  notice  of  the  de-notification.  The  AIFM  must  also  notify  the 
authorities of the offers presented to the investors to repurchase units and shares of the AIF 
that is no longer going to be marketed in their Member State. All transparency requirements 
that investors must fulfil pursuant to Directive 2011/61/EU will continue to apply to investors 
who  retain  their  investment  after  de-notification  of  the  marketing  activities  in  the  selected 
Member State. 

Article  43a  is  inserted  in  Directive  2011/61/EU  to  ensure  a  consistent  treatment  of  retail 
investors regardless of the type of fund in which they decide to invest. Where Member States 
allow  AIFMs  to  market  units  or  shares  of  AIFs  in  their  territories  to  retail  investors,  those 
AIFMs  should  also  make  facilities  available  to  retail  investors  to  serve  situations  such  as 
making subscriptions, making payments or repurchasing or redeeming units. For this purpose, 
AIFMs  will  be  able  to  use  electronic  or  other  means  of  distance  communication.

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2018/0041 (COD) 

Proposal for a 

DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 

 amending Directive 2009/65/EC of the European Parliament and of the Council and 
Directive 2011/61/EU of the European Parliament and of the Council with regard to 
cross-border distribution of collective investment funds 

(Text with EEA relevance) 

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  on  the  Functioning  of  the  European  Union,  and  in  particular 
Article 53(1) thereof, 

Having regard to the proposal from the European Commission, 

After transmission of the draft legislative act to the national parliaments, 
Having regard to the opinion of the European Central Bank23, 
Having regard to the opinion of the European Economic and Social Committee24,  

Acting in accordance with the ordinary legislative procedure, 

Whereas: 

(1) 

(2) 

23 
24 
25 

26 

A common objective of Directive 2009/65/EC of the European Parliament and of the 
Council25 and Directive 2011/61/EU of the European Parliament and of the Council26 
is  to  ensure  a  level  playing  field  among  collective  investment  undertakings  and  to 
remove restrictions to the free movement of units and shares of collective investment 
funds in the Union at the same time ensuring more uniform protection for investors. 
While these objectives have been largely achieved, certain barriers still hamper fund 
managers’ ability to fully benefit from the internal market. 

The rules proposed in this Directive are complemented by a dedicated Regulation [on 
facilitating  cross-border  distribution  of  collective  investment  funds  and  amending 
Regulations (EU) No 345/2013 and (EU) No 346/2013]. It lays down additional rules 
and  procedures  concerning  undertakings  for  collective  investment  in  transferable 
securities  (UCITS)  and  alternative  investment  fund  managers  (AIFMs)  That 
Regulation  and  this  Directive  should  collectively  further  coordinate  the  conditions 
for  fund  managers  operating  in  the  internal  market  and  facilitate  cross-border 
distribution of the funds they manage.       

OJ C […], […], p. […]. 
OJ C , , p. . 
Directive  2009/65/EC  of  the  European  Parliament  and  of  the  Council  of  13  July  2009  on  the 
coordination  of  laws,  regulations  and  administrative  provisions  relating  to  undertakings  for  collective 
investment in transferable securities (UCITS), OJ L 302, 17.11.2009, p. 32. 
Directive  2011/61/EU  of  the  European  Parliament  and  of  the  Council  of  8  June  2011  on  Alternative 
Investment Fund Managers (AIFM), OJ L 174, 1.7.2011, p. 1. 

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(3) 

(4) 

(5) 

(6) 

(7) 

(8) 

It  is  necessary  to  fill  in  the  regulatory  gap  and  align  the  procedure  governing 
notification to the competent authorities of the changes that UCITS are planning in 
relation  to  their  managed  funds  with  those  which  are  laid  down  in  Directive 
2011/61/EU.  

Regulation  [on  facilitating  cross-border  distribution  of  collective  investment  funds 
and  amending  Regulations  (EU)  No  345/2013  and  (EU)  No  346/2013]  establishes 
new  rules  requiring  the  European  Securities  and  Markets  Authority  (ESMA),  to 
develop  draft  regulatory  technical  standards  and  draft  implementing  technical 
standards  to  specify  the  information  required  and  the  forms,  templates  and 
procedures  to  be  used  for  the  transmission  of  that  information  in  relation  to 
management  of  funds,  take-up  or  discontinuing  of  marketing  of  funds  under 
Directive 2009/65/EC and Directive 2011/61/EU. Therefore, the provisions of those 
two  Directives  providing  ESMA  with  discretionary  empowerments  to  develop 
regulatory  technical  standards  and  draft  implementing  technical  standards  for 
notifications are no longer necessary and therefore should be deleted.   

Regulation  [on  facilitating  cross-border  distribution  of  collective  investment  funds 
and  amending  Regulations  (EU)  No  345/2013  and  (EU)  No  346/2013]  further 
strengthens  the  principles  applicable  to  marketing  communications  governed  by 
Directive 2009/65/EC and extends their application to the AIFMs, thus resulting in a 
high  standard of investor protection, regardless of the type of investor. As a result, 
the  corresponding  provisions  of  Directive  2009/65/EC  relating  to  marketing 
communications  and  accessibility  of  national  laws  and  regulation  relevant  to  the 
arrangement  of  marketing  units  of  UCITS  are  no  longer  necessary  and  therefore 
should be deleted. 

The provisions of Directive 2009/65/EC, which require UCITS to provide facilities 
to  investors,  as  implemented  by  certain  national  legal  systems,  have  proven  to  be 
burdensome. Moreover, the local facilities are rarely used by investors as intended by 
the  Directive.  The  preferred  method  of  contact  has  shifted  to  direct  interaction  of 
investors  with  the  fund  manager  —  either  electronically  or  by  telephone,  whereas 
payments  and  redemptions  are  executed  through  other  channels.  While  these 
facilities  are  used  for  administrative  purposes  such  as  cross-border  recovery  of 
regulatory fees, such issues, however, should be addressed via other means including 
cooperation  between  the  competent  authorities.  Consequently,  rules  should  be 
established, which modernise and specify the requirements for providing facilities to 
retail investors, a physical presence should not be required by Member States. At the 
same time rules should ensure that investors have access to the information to which 
they are entitled. 

In  order  to  ensure  a  coherent  treatment  of  retail  investors,  it  is  necessary  that  the 
requirements  relating  to  facilities  are  also  applied  to  AIFMs  where  Member  States 
allow them to market units or shares of AIFs to retail investors in their territories. 

The absence of clear and uniform conditions for the discontinuation of marketing of 
units or shares of a UCITS or an EU AIF in a host Member State creates economic 
and legal uncertainty for the fund managers. Therefore, this proposal lays down clear 
conditions,  including  thresholds,  under  which  deregistration  could  take  place.  The 
thresholds  are  indicative  of  when  a  fund  manager  may  consider  that  its  activities 
have become insignificant in a particular host Member State. The conditions are set 
in such a way that they balance, on the one hand, the interests of fund managers to be 
able to deregister marketed funds when the established conditions are met, and on the 

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(9) 

(10) 

(11) 

(12) 

(13) 

other  hand,  the  interests  of  investors  in  the  fund  from  the  host  Member  State 
concerned.  

The possibility to stop marketing  UCITS or  EU AIFs in  a particular Member State 
should not come at a cost to investors, nor diminish their safeguards under Directive 
2009/65/EC  or  Directive  2011/61/EU,  in  particular  with  regard  to  their  right  to 
accurate information on the continued activities of those funds.   

There  are  cases  where  an  AIFM  willing  to  test  investor  appetite  for  a  particular 
investment  idea  or  investment  strategy  is  faced  with  a  divergent  treatment  of  pre-
marketing  activities  in  different  national  legal  systems.  In  some  Member  States 
where  pre-marketing  is  permitted,  its  definition  and  conditions  vary  considerably. 
However,  in  other  Member  States  there  is  no  concept  of  pre-marketing  at  all.  To 
address  these  divergences,  a  harmonised  definition  of  pre-marketing  should  be 
provided  and  conditions  under  which  an  EU  AIFM  can  engage  in  these  activities 
should be established. 

For pre-marketing to be recognised as such under this Directive, it should concern an 
investment  idea  or  strategy  without  having  an  actual  AIF  already  established. 
Accordingly, during the course of pre-marketing, investors are unable to subscribe to 
the  units  or  shares  of  an  AIF  because  the  fund  does  not  exist  yet,  and  no  offering 
documents,  even  in  a  draft  form,  should  be  permitted  to  be  distributed  to  potential 
investors during this stage. However, when following the pre-marketing activities the 
AIFM offers for subscription units or shares of an AIF with the features akin to the 
pre-marketed  investment  idea,  the  appropriate  marketing  notification  procedure 
should be observed and the AIFM should not be able to invoke reverse solicitation. 

In order to ensure legal certainty, it is necessary to synchronise the application dates 
of  laws,  regulations  and  administrative  provisions  implementing  this  Directive 
Regulation  [on  facilitating  cross-border  distribution  of  collective  investment  funds 
and amending Regulations (EU) No 345/2013 and (EU) No 346/2013] with regard to 
relevant  provisions  on  marketing  communications  and  pre-marketing.  It  is  also 
necessary to coordinate the empowerments granted to the Commission to adopt draft 
regulatory  technical  standards  and  implementing  technical  standards,  as  developed 
by  ESMA,  under  Regulation  [on  facilitating  cross-border  distribution  of  collective 
investment  funds  and  amending  Regulations  (EU)  No  345/2013  and  (EU)  No 
346/2013] in the area of notifications, notification letters or written notices on cross-
border activities that are to be deleted by this Directive from Directive 2009/65/EC 
and Directive 2011/61/EU respectively. 

In accordance with the Joint Political Declaration of 28 September 2011 of Member 
States  and  the  Commission  on  explanatory  documents27,  Member  States  have 
undertaken  to  accompany,  in  justified  cases,  the  notification  of  their  transposition 
measures  with  one  or  more  documents  explaining  the  relationship  between  the 
components  of  a  directive  and  the  corresponding  parts  of  national  transposition 
instruments. With regard to this Directive, the legislator considers the transmission of 
such documents to be justified, 

27 

OJ C 369, 17.12.2011, p. 14. 

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HAVE ADOPTED THIS DIRECTIVE: 

Article 1 

Amendments to Directive 2009/65/EC 

Directive 2009/65/EC is amended as follows: 

(1) 

Article 17 is amended as follows: 

(a) 

the following paragraph 8a is inserted: 

‘Where, pursuant to a change referred to in paragraph 8, the UCITS would no longer 
comply  with  this  Directive,  the  relevant  competent  authorities  referred  to  in 
paragraph 8 shall notify the management company within 10 working days that it is 
not to implement that change. 

Where a change referred to in paragraph 8 is implemented after notification has been 
made  in  accordance  with  the  first  subparagraph  and  pursuant  to  that  change  the 
UCITS no longer complies with this Directive, the competent authorities of the home 
Member State of the UCITS shall take all due measures in accordance with Article 
98. 

Where  a  change  referred  to  paragraph  8  does  not  affect  the  compliance  of  the 
management  company  with  this  Directive,  the  competent  authorities  of  the  home 
Member  State  of  the  management  company  shall,  within  10  working  days,  inform 
the competent authorities of the host Member State of the management company of 
those changes.’ 

(b)  paragraph 10 is deleted. 

in Article 18, paragraph 5 is deleted. 

Article 77 is deleted. 

in Article 91, paragraph 3 is deleted. 

Article 92 is replaced by the following: 

(2) 

(3) 

(4) 

(5) 

‘Article 92 

1. Member States shall ensure that the UCITS management company establishes, in 
each Member State where it intends to market units of a UCITS, facilities to perform 
the following tasks: 

(a)  process  investors’  subscription,  payment,  repurchase  and  redemption  orders 
relating to the units of the UCITS, in accordance with the conditions set out in 
the UCITS marketing documents; 

(b)  provide investors with information on how orders referred to in point (a) can be 

made and how repurchase and redemption proceeds are paid; 

(c) 

facilitate the handling of information relating to the investors’ exercise of their 
rights arising from their investment in the UCITS in the Member State where 
the UCITS is marketed; 

(d)  make available to investors, for inspection and for the obtaining of copies of: 

(i) 

(ii) 

fund rules or instruments of incorporation of the UCITS; 

the latest annual report of the UCITS; 

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(e)  provide investors with information relevant to the tasks the facilities perform in 

a durable medium as defined in Article 2(1)(m). 

2.  Member  States  shall  not  require  the  UCITS  management  company  to  have  a 
physical presence for the purpose of paragraph 1. 

3.  The  UCITS  management  company  shall  ensure  that  the  facilities  referred  to  in 
paragraph 1 are of the following types and have the following characteristics: 

(a) 

(b) 

their  tasks  are  performed  in  the  official  language  or  official  languages  of  the 
Member State where the UCITS is marketed; 

their  tasks  are  performed  the  UCITS  management  company  itself  or  a  third 
entity subject to regulation governing the tasks to be performed, or both; 

For the purposes of point (b), where the facilities are performed by a third entity, the 
appointment  of  a  third  entity  shall  be  evidenced  by  a  written  contract,  which 
specifies  which  of  the  tasks  referred  to  in  paragraph  1  are  not  performed  by  the 
UCITS  management  company  and  that  the  third  entity  receives  all  the  relevant 
information and documents from the UCITS management company.’ 

(6) 

in Article 93, paragraph 8 is replaced by the following: 

‘8. In the event of a change to the information in the notification letter submitted in 
accordance with paragraph 1, or a change regarding share classes to be marketed, the 
UCITS  shall  give  written  notice  thereof  to  the  competent  authorities  of  the  home 
Member State at least one month before implementing that  change. 

Where, pursuant to a change referred to in the first subparagraph the UCITS would 
no longer comply with this Directive, the relevant competent authorities shall notify 
the UCITS within 10 working days that it is not to implement that change. 

Where a change referred to in the first subparagraph is implemented after notification 
has  been  made  in  accordance  with  the  second  subparagraph  and  pursuant  to  that 
change the UCITS no longer complies with this Directive, the competent authorities 
of the home Member State of the UCITS shall take all due measures in accordance 
with Article 98, including, where necessary, the express prohibition of marketing of 
the UCITS. 

Where the changes referred to in the first subparagraph do not affect the compliance 
of  the  UCITS  with  this  Directive,  the  competent  authorities  of  the  home  Member 
State of the UCITS shall, without undue delay, inform the competent authorities of 
the host Member State of the UCITS of those changes.’ 

(7) 

the following Article 93a is inserted: 

‘Article 93a 

1.  The  competent  authorities  of  the  UCITS  home  Member  State  shall  ensure  that 
UCITS may discontinue marketing its units in a Member State where it has notified 
its  activities  in  accordance  with  Article  93,  where  all  the  following  conditions  are 
fulfilled: 

(a)  no  investor  which  is  domiciled  or  has  a  registered  office  in  a  Member  State 
where the UCITS has notified its activities in accordance with Article 93 holds 
units of that UCITS, or no more than 10 investors which are domiciled or have 
a registered office in that Member State hold units of the UCITS representing 
less than 1 % of assets under management of that UCITS; 

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(b) 

(c) 

 a blanket offer to repurchase, free of any charges or deductions, all its UCITS 
units  held  by  investors  in  a  Member  State  where  the  UCITS  has  notified  its 
activities in accordance with Article 93 is made public for at least 30 working 
days  and  is  addressed  individually  to  all  investors  in  the  host  Member  State 
whose identity is known; 

the  intention  to  stop  the  marketing  activities  in  the  Member  State  where  the 
UCITS has notified its activities in accordance with Article 93 is made public 
by  means  of  a  publicly  available  medium  which  is  customary  for  marketing 
UCITS and suitable for a typical UCITS investor. 

The  information  referred  to  in  points  (b)  and  (c)  shall  be  provided  in  the  official 
languages of the Member State where the UCITS has been marketed. 

2. The UCITS shall submit a notification letter to the competent authority of its home 
Member State comprising the information referred to in paragraph 1. 

3. The competent authorities of the UCITS home Member State shall, no later than 
20  working  days  from  the  receipt  of  the  notification  referred  to  in  paragraph  2, 
transmit it to the competent authorities of the Member State where marketing of the 
UCITS is intended to be discontinued and to ESMA. 

Upon  transmission  of  the  notification  file  pursuant  to  the  first  subparagraph  the 
competent authorities of the UCITS home Member State shall immediately notify the 
UCITS of that transmission. As of this date, the UCITS shall cease all marketing of 
its  units  in  the  Member  State  identified  in  the  notification  letter  referred  to  in 
paragraph 2. 

4. The UCITS shall continue providing investors who remain invested in the UCITS, 
with the information required under Articles 68 to 82 and under Article 94. 

5.  Member  States  shall  allow  for  the  use  of  all  electronic  or  other  distance 
communication means for the purposes of paragraph 4, provided the information and 
communication  means  are  available  for  investors  in  the  official  languages  of  the 
Member State where the investor is located.’   

(8) 

in Article 95, paragraph (2)(a) is deleted. 

Article 2 

Amendments to Directive 2011/61/EU 

Directive 2011/61/EU is amended as follows: 

(1) 

in Article 4(1), between points (ae) and (af), the following point (aea) is inserted: 

‘(aea)  ‘‘pre-marketing’  means  a  direct  or  indirect  provision  of  information  on  investment 
strategies or investment ideas by an AIFM or on its behalf to professional investors domiciled 
or registered in the Union in order to test their interest in an AIF which is not yet established.’  

(2) 

the following Article 30a is inserted at the beginning of CHAPTER VI: 

‘Article 30a 

Conditions for pre-marketing in the Union by an EU AIFM 

1.  Member  States  shall  ensure  that  an  authorised  EU  AIFM  may  engage  in  pre-
marketing  in  the  Union,  excluding  where  the  information  presented  to  potential 
professional investors:  

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(a) 

(b) 

(c) 

(d) 

relates to an established AIF; 

contains reference to an established AIF; 

enables investors to commit to acquiring units or shares of a particular AIF; 

amounts  to  a  prospectus,  constitutional  documents  of  a  not-yet-established 
AIF, offering documents, subscription forms or similar documents whether in a 
draft or a final form allowing investors to take an investment decision. 

2. Member States shall ensure that no requirement to notify the competent authorities 
of pre-marketing activities is necessary for an EU AIFM to engage in pre-marketing 
activities. 

3.  Subscription  by  professional  investors  to  units  or  shares  of  an  AIF  established 
following the pre-marking in accordance with paragraph 1 or to the units or shares of 
AIFs managed or marketed by the EU AIFM that had engaged in pre-marketing of a 
not-yet-established  AIF  with  the  similar  features  shall  be  considered  the  result  of 
marketing.’ 

(3) 

(4) 

in Article 31, paragraph 5 is deleted. 

in Article 32 is amended as follows: 

(a) 

the second subparagraph of paragraph 7 is replaced by the following: 

‘If,  pursuant  to  a  planned  change,  the  AIFM’s  management  of  the  AIF  would  no 
longer  comply  with  this  Directive or  the  AIFM  would  otherwise  no  longer  comply 
with this Directive, the relevant competent authorities shall inform the AIFM within 
20 working days that it is not to implement the change.‘ 

(b) 

 the fourth subparagraph of paragraph 7 is replaced by the following: 

‘If the changes do not affect the compliance of the AIFM’s management of the AIF 
with this Directive, or the compliance by the AIFM with this Directive otherwise, the 
competent  authorities  of  the  home  Member  State  of  the  AIFM  shall  within  one  
month  inform  the  competent  authorities  of  the  host  Member  State  of  the  AIFM  of 
those changes.‘ 

(c) 

 paragraph 8 is deleted. 

(5) 

the following Article 32a is inserted: 

‘Article 32a 

Discontinuation  of  marketing  of  units  or  shares  of  EU  AIFs  in  the  Member 
States other than in the home Member State of the AIFM 

1. Member States shall ensure that an EU AIFM may discontinue marketing units or 
shares of an EU AIF that it manages in the Member State where a notification of its 
marketing activities has been transmitted in accordance with Article 32, where all of 
the following conditions are fulfilled: 

(a)  no investor, which is domiciled or has a registered office in the Member State, 
where  a  notification  of  its  marketing  activities  has  been  transmitted  in 
accordance with Article 32, holds units or shares of that AIF or no more than 
10  investors,  which  are domiciled  or  have  a  registered  office  in  that  Member 
State, hold units or shares of the AIF representing less than 1 % of assets under 
management of that AIF; 

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(b) 

(c) 

 a  blanket  offer  to  repurchase,  free  of  any  charges  or  deductions,  all  its  AIF 
units or shares held by investors in the Member State, where a notification of 
its marketing activities has  been transmitted in accordance with  Article 32, is 
made  public  at  least  for  30  working  days  and  is  addressed  individually  to  all 
investors in that Member State whose identity is known; 

the  intention  to  stop  the  marketing  activities  on  the  territory  of  the  Member 
State,  where  a  notification  of  its  marketing  activities  has  been  transmitted  in 
accordance  with  Article  32,  is  made  public  by  means  of  a  publicly  available 
medium which is customary for marketing AIF and suitable for a typical AIF 
investor. 

2.  The  AIFM  shall  submit  a  notification  to  the  competent  authority  of  its  home 
Member State comprising the information referred to in paragraph 1. 

3. The competent authorities of the home Member State of the AIFM shall, no later 
than 20 working days following the receipt of the complete notification referred to in 
paragraph  2,  transmit  it  to  the  competent  authorities  of  the  Member  State  where 
marketing of AIF is intended to be discontinued and to ESMA. 

Upon  transmission  of  the  notification  file  pursuant  to  the  first  subparagraph,  the 
competent  authorities  of  the  home  Member  State  of  the  AIFM  shall  immediately 
notify  the  AIFM  of  that  transmission.  As  of  this  date,  the  AIFM  shall  cease  all 
marketing of units or shares of the AIF it manages in the Member State identified in 
the notification letter referred to in paragraph 2. 

4. The AIFM shall continue providing investors who remain invested in the EU AIF 
with the information required under Articles 22 and 23. 

5.  Member  States  shall  allow  for  the  use  of  all  electronic  or  other  distance 
communication means for the purposes of paragraph 4.   

(6) 

(7) 

in Article 33, paragraphs 7 and 8 are deleted. 

the following Article 43a is inserted: 

‘Article 43a 

Facilities available to retail investors 
1.  Without  prejudice  to  Article  26  of  Regulation  (EU)  2015/76028,  Member  States 
shall  ensure  that  an  AIFM  establishes,  in  each  Member  State  where  it  intends  to 
market units or shares of an AIF to retail investors, facilities to perform the following 
tasks: 

(a)  process  investors’  subscription,  payment,  repurchase  and  redemption  orders 
relating to the units or shares of the AIF, in accordance with the conditions set 
out in the AIF’s marketing documents; 

(b)  provide investors with information on how orders referred to in point (a) can be 

made and how repurchase and redemption proceeds are paid; 

(c) 

facilitate  the  handling  of  information  relating  to  the  exercise  of  investors’ 
rights arising from their investment in the AIF in the Member State where the 
AIF is marketed; 

28 

Regulation  (EU)  2015/760  of  the  European  Parliament  and  of  the  Council  of  29  April  2015  on 
European long-term investment funds OJ L 123, 19.5.2015, p. 9. 

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(d)  make available to investors for inspection and for the obtaining copies of: 

(i) 

(ii) 

fund rules or instruments of incorporation of the AIF; 

the latest annual report of the AIF; 

(e)  provide investors with information relevant to the tasks the facilities perform in 
a durable medium as defined in Article 2(1)(m) of Directive 2009/65/EC. 

2.  Member  States  shall  not  require  an  AIFM  to  have  a  physical  presence  for  the 
purpose of paragraph 1. 

3.  The  AIFM  shall  ensure  that  the  facilities  referred  to  in  paragraph  1  are  of  the 
following types and have the following characteristics: 

(a) 

(b) 

their  tasks  are  performed  in  the  official  language  or  official  languages  of  the 
Member State where the AIF is marketed; 

their tasks are performed by AIFM itself or a third entity, subject to regulation 
governing the tasks to be performed, or both. 

For the purposes of point (b), where the facilities are performed by a third entity this 
appointment shall be evidenced by a written contract, which specifies which of the 
tasks  specified  in  paragraph  1  are  not  performed  by  the  AIFM  and  that  the  third 
entity receives all the relevant information and documents from the AIFM.’ 

Article 3 

Transposition 

1. 

Member States shall adopt and publish, by [PO: Please insert date 24 months after 
the  date  of  entry  into  force]  at  the  latest,  the  laws,  regulations  and  administrative 
this  Directive.  They  shall  forthwith 
provisions  necessary 
communicate to the Commission the text of those provisions. 

to  comply  with 

They shall apply those provisions from [PO: Please insert date 24 months after the 
date of entry into force]. 

When  Member  States  adopt  those  provisions,  they  shall  contain  a  reference  to  this 
Directive  or  be  accompanied  by  such  a  reference  on  the  occasion  of  their  official 
publication. Member States shall determine how such reference is to be made. 

2. 

Member States shall communicate to the Commission the text of the main provisions 
of national law which they adopt in the field covered by this Directive. 

Article 4 

Evaluation 

By  [PO:  Please  insert date  36  months  after the  date for  transposition of  this  Directive]  the 
Commission  shall,  on  the  basis  of  a  public  consultation  and  in  light  of  discussions  with 
ESMA and competent authorities, conduct an evaluation of the application of this Directive.  

Article 5 

Entry into force 

This Directive shall enter into force on the twentieth day following that of its publication in 
the Official Journal of the European Union. 

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Articles 1(1)(b), 1(2) 1(8), 2(3), 2(4)(c) and 2(6) shall apply from the day of entry into force 
of this Directive.  

This Directive is addressed to the Member States. 

Done at Brussels, 

Article 6 

For the European Parliament 
The President 

For the Council 
The President 

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