27 janvier 2020

Communiqué relatif aux Questions/Réponses de l’ESMA concernant les informations sur la valeur de référence dans le KIID pour OPCVM (uniquement en anglais)

On 29 March 2019, the European Securities and Markets Authority (ESMA) issued an update to its Questions and Answers on the application of the UCITS Directive (hereafter “ESMA Q&A”) in order to further clarify the UCITS’ KIID benchmark and related past performance disclosure obligations.

In this context, the CSSF would like to remind that UCITS management companies and self-managed UCITS (hereafter “UCITS management companies”) have to incorporate the necessary changes in the KIIDs by 19 February 2020 (i.e. 35 business days after 31 December 2019) at the latest.

The updated KIIDs shall be transmitted to the CSSF via the usual transmission channels.

ESMA specified in its Q&A that the information disclosed in the UCITS KIID should be consistent with the UCITS’ objectives and investment policy in the Prospectus. As a result, UCITS management companies have to assess whether a change of the Prospectus is necessary, to verify that KIID and Prospectus disclosures are aligned and, where applicable, to proceed with a filing of an update of the Prospectus to the CSSF until the earlier of the next revision of the Prospectus or the end of the year 2020.

In this context, the CSSF also wishes to remind that, following the clarifications of the ESMA Q&A, the benchmark related disclosures in the KIID should notably include the following elements:

  • whether the UCITS is “actively” or “passively” managed;
  • the indication of the benchmark index (or indices) the UCITS is tracking or is making reference to;
  • the disclosure on the use of the benchmark (e.g. outperformance objective, performance comparison, risk limitation, definition of investment universe), the degree of freedom from the benchmark and the past performance against the benchmark when the investment approach of the UCITS includes or implies a reference to a benchmark, in accordance with Q&A 8b of Section II of the ESMA Q&A.

Q&A 8c of Section II of the ESMA Q&A provides further clarifications with respect to the disclosure of the degree of freedom from the benchmark, clarifying in particular that (i) the description of the underlying investment universe of the UCITS should indicate to what extent the target investments are part of the benchmark or not and that (ii) the KIID should describe the degree or level of deviation of the UCITS in regards to the benchmark, thereby considering, where applicable, the quantitative and/or qualitative deviation limitations underlying the investment approach as well the narrowness of investment universe.