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2022 saw numerous developments in investment funds regulation. These included :

  • The additional sustainability requirements introduced for fund management companies under Delegated Acts amending the UCITS directive and AIFMD
  • The overhaul of the ELTIF with the proposed amendments to the ELTIF Regulation, and
  • The ending of the exemption applicable to UCITS to produce a PRIIPs KID and changes to the format and content required for a PRIIPs KID.

As part of a number of interrelated measures introduced by the EU Commission under the Action Plan on Financing Sustainable Growth, the Delegated Acts introduced requirements for fund management companies to embed sustainability risk and sustainability factors into their organisation structures and procedures.

The proposed amendments to the ELTIF seek to reform and revamp the subcategory of EU AIFs. A package of legislative proposals were adopted to enhance the attractiveness of the ELTIF as a long-term investment vehicle. The proposed amendments enable, among other reforms, more diverse investment opportunities, the creation of fund of fund structures and the removal of the minimum investment amounts for retail investors.

The requirement for manufacturers and sellers of packaged retail and insurance-based investment products (PRIIPs) to provide a PRIIPs Key Information Document (PRIIPs KID) previously only applied to AIFs. However, the exemption extended to UCITS is to end with the requirement for a UCITS to provide a PRIIPs KID coming into effect on 1 January 2023. In addition, the PRIIPs KID format and content is due to change substantially.

Sustainable Finance Requirements for Fund Management Companies

The Delegated Acts introduced requirements for fund management companies to integrate sustainability risks into their organisational procedures, conflicts of interest management, conduct of business rules and risk management procedures, as well as a requirement to consider sustainability risks and factors when undertaking investment due diligence. These requirements are in addition to the disclosure requirements under the SFDR and the Taxonomy Regulation and apply regardless of whether the fund under management is an Article 6, Article 8 or Article 9 fund under the SFDR. Fund management companies will need to take account of sustainability risk and sustainability factors as part of their duties towards investors.

While the Acts take a high-level principled approach allowing some flexibility, careful consideration will be required from the boards of fund management companies to ensure proper compliance.

Read the full article: Sustainable Finance Requirements for Fund Management Companies

What is the Future for the ELTIF?

The European long-term investment fund regulation, also known as the ELTIF Regulation, was introduced in 2015 with the aim of increasing European long-term investments in the real economy and address the financing required for environmental sustainability. Despite the benefits offered by the ELTIF Regulation, the take-up of ELTIFs has been slow resulting in the launch of a review of the ELTIF Regulation by the European Commission in 2020.

The result of the review was a package of measures introduced by the European Commission amending the ELTIF Regulation. The key changes include differentiating between ELTIF’s marketed to professional investors and retail investors, removing barriers to retail investor access, and establishing an optional liquidity window mechanism for redemptions, where investors need to exit early.

Read the full article: What is the Future for the ELTIF?

PRIIP-paring for the New KID in Town

The PRIIPs Regulation introduced an obligation on the PRIIP manufacturers and sellers to produce a PRIIPs KID when investment products are sold to retail investors in the EEA. Previously a UCITS was exempt due to the requirement under the UCITS Directive for a Key Investor Information Document (“KIID”), which is largely similar to the PRIIPs KID. However, the exemption has come to end with the PRIIPs KID replacing the UCITS KIID with effect from 1 January 2023.

New format and content requirements will apply to the PRIIPs KID with effect from 1 January 2023 with the introduction of the amended Regulatory Technical Standards.

Read the full article: PRIIP-paring for the New KID in Town


Investment Funds law remains an ever-evolving area with the ongoing reform of current regulation, the introduction of new legislation and new Central Bank guidance. With this comes an ever increasing need to be mindful of the necessary updates required and the associated deadlines imposed by the Central Bank in order to take the necessary steps to ensure you are complying with all regulatory requirements.

For expert guidance on all matters, contact a member of our Investment Funds team.

The content of this article is provided for information purposes only and does not constitute legal or other advice.

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