Funds and asset management regulatory news, April 2021

Hogan Lovells

Hogan Lovells

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


  • Liquidity management in UK open-ended funds: BoE and FCA report
  • EU MMF Regulation: ESMA consultation on reforms
  • AIFMD and UCITS Directive: ESMA updates Q&As

Following a seasonal break, the next update will be published on 19 April 2021.

Liquidity management in UK open-ended funds: BoE and FCA report

The Bank of England (BoE) and the Financial Conduct Authority (FCA) have published a report on liquidity management in UK open-ended funds. The report contains findings of a joint survey launched in August 2020, covering a reporting period of Q4 2019 to Q2 2020, therefore incorporating market conditions triggered by the COVID-19 pandemic. The survey forms part of the ongoing joint review by the BoE and the FCA on open-ended funds liquidity mismatch.

EU MMF Regulation: ESMA consultation on reforms

The European Securities and Markets Authority (ESMA) has published a consultation paper on the legislative review of the EU Regulation on money market funds (MMF Regulation). Article 46 of the MMF Regulation requires the European Commission to review the adequacy of the Regulation "from a prudential and economic point of view". ESMA's consultation is the first step in developing an opinion on this review and includes a discussion about the key issues faced by MMFs during the COVID-19 pandemic, which saw a number of funds face significant liquidity issues.

The consultation closes to comments on 30 June 2021. ESMA will consider feedback received in Q2 2021 and plans to publish an opinion on the review of the MMF Regulation in the second half of 2021.

AIFMD and UCITS Directive: ESMA updates Q&As

ESMA has published an updated version of its Q&As on the application of the Alternative Investment Fund Managers Directive (AIFMD) and its Q&As on the application of the UCITS Directive. ESMA has added two new Q&As in each on its guidelines on performance fees in UCITS and certain types of alternative investment funds (AIFs).

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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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