Publication of the Results of the CSSF Thematic Review on Efficient Portfolio Management – Revenues & Costs/Fees and of the CSSF FAQ on the use of Securities Financing Transactions by UCITS
A thematic review on the use by Luxembourg domiciled UCITS of Efficient Portfolio Management techniques (EPM) was performed by the CSSF at the end of 2019 by means of a questionnaire addressed to a panel of fifty investment fund managers (IFM). The review was focused on the regulatory provisions on revenues and costs / fees arising from these EPM techniques as well as the related controls in place at the level of the IFM.
More particularly, the questionnaire covered various aspects, such as the model used by the IFMs for the EPM (principal or agent model), the policy regarding operational costs, taxation, disclosure, investment restriction controls, conflicts of interest and best execution controls.
In this context, the CSSF would like to inform market participants about the publication of the following two documents:
- The report “CSSF Thematic Review – Use of Efficient Portfolio Management by UCITS – Revenues & Costs/Fees” which presents the main observations made by the CSSF in the context of the thematic review, together with the related recommendations.
- The FAQ “Use of Securities Financing Transactions by UCITS” which refers to a list of questions & answers in relation to the use by Luxembourg-domiciled UCITS of securities lending transactions, reverse repurchase agreement transactions and repurchase agreement transactions and whose objective is to provide clarifications concerning the use by UCITS of these SFTs.
The CSSF expects the disclosure clarifications given in the FAQ to be included in the prospectus, respectively in the disclosure to investors, by 30 September 2021.