Funds and asset management regulatory news, November 2020 # 4

Hogan Lovells

Hogan Lovells

Selected regulatory updates of interest to the funds and asset management sector. 


  • Bearer Certificates (Collective Investment Schemes) Regulations 2020
  • Integrating stewardship into investment process: Asset Management Taskforce report
  • Future challenges for fund managers: ESMA speech

Bearer Certificates (Collective Investment Schemes) Regulations 2020

The Bearer Certificates (Collective Investment Schemes) Regulations 2020 (SI 2020/1346) have been published, together with an explanatory memorandum. The Regulations were made on 24 November 2020 and come into force on 1 January 2021.

Abolishing bearer certificates, also known as share warrants to bearer, or otherwise implementing measures to prevent their misuse, is required under international standards on anti-money laundering and tax transparency. SI 2020/1346 closes a technical loophole which still allowed two types of investment vehicle to issue bearer certificates. All collective investment schemes, including UK OEICs incorporated before 26 June 2017 and all UUTS, will be prohibited from issuing bearer certificates. The explanatory memorandum indicates that this will have minimal impact on businesses, as there is no evidence that bearer certificates have in fact been issued. However, it will ensure that the UK is meeting its international obligations, following a recommendation from the Global Forum on Transparency and Exchange of Information for Tax Purposes (part of the OECD).

Integrating stewardship into investment process: Asset Management Taskforce report

The Investment Association (IA) has published a report, "Investing with Purpose: placing stewardship at the heart of sustainable growth", produced by the Asset Management Taskforce, a group of the UK's leading investment managers, stakeholders and regulators, led by HM Treasury and supported by the IA. The report provides a blueprint for integrating stewardship into the investment process and seeks to cement the UK as a global centre of excellence in stewardship practice.

Future challenges for fund managers: ESMA speech

The European Securities and Markets Authority (ESMA) has published a speech by Verena Ross, ESMA Executive Director, on future challenges for fund managers. Among other things, Ms Ross discusses events in the sector relating to COVID-19, delegation in the light of the end of the Brexit transition period (referring to ESMA's letter to the European Commission on the review of the Alternative Investment Fund Managers Directive and the Commission's related consultation) and sustainable finance. Among other things, Ms Ross notes that the European Supervisory Authorities intend to launch a consultation paper in January 2021 on additional taxonomy-related product disclosures, stemming from empowerment given to them by the Taxonomy Regulation.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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