UK investors will continue to benefit from easy access to EU investment funds under new regulatory regime

Supervision

European fund body asks UK regulator to further simplify recognition of EU retail funds

The UK regulator (FCA) has taken a pragmatic approach in developing its Overseas Fund Regime (OFR) specifying the process that European retail funds would have to follow to gain, and keep, access to the UK market. This regime, which will replace the Temporary Marketing Permission Regime (TMPR), offers a streamlined access to the UK market in comparison to the current and time-consuming recognition process which is open to all overseas funds. Last week, the HM Treasury stated that the EU UCITS fund regime is considered equivalent to the UK regime. This type of regulatory alignment between markets is very welcome and will certainly benefit investors and asset managers alike.

However, a few more changes to the envisaged regime would ensure that UK investors can continue to invest in EU funds without any excessive increase in costs.

• Reduce some of the regulatory and supervisory burden that would stem from the OFR, particularly when similar requirements do not exist for UK funds
• Ensure that OFR recognised funds can disclose the mandated information in the most efficient way possible (i.e. by uploading information to the FCA’s online platform from CSV, XML, or excel files rather than manually).

Marin Capelle, Regulatory Policy Advisor at EFAMA, commented: “Although most funds bought in the UK have their domicile in the UK, we strongly believe that European funds can bring real value to UK retail investors. In fact, according to the Investment Association, their share of the UK market has increased over time. We hope that the Overseas Fund Regime will allow UK investors to continue to choose funds based on their respective merits, regardless of where the fund’s domicile is located.”

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Note to editors :

You can find the full FCA consultation here.
Read our full position paper on the overseas fund regime here.

For further information, please contact:

Hayley McEwen
Head of Communication & Membership Development
Tel: +32 2 548 26 52
Email: Hayley.McEwen@efama.org

Contact

Hayley McEwen

Communications & Membership Development

Although most funds bought in the UK have their domicile in the UK, we strongly believe that European funds can bring real value to UK retail investors. In fact, according to the Investment Association, their share of the UK market has increased over time. We hope that the Overseas Fund Regime will allow UK investors to continue to choose funds based on their respective merits, regardless of where the fund’s domicile is located. (Marin Capelle, Regulatory Policy Advisor, EFAMA)