On 30 May 2000 the European Commission approved two amended proposals designed to update legislation on harmonised investment funds (UCITS). The aim is to broaden the scope of allowable investments and update how they can be managed to take account of the rapidly changing financial environment. Collective investment units (such as unit trusts and SICAVs), where investors%%%% money is placed by a qualified fund manager in a diverse range of assets according to defined risk criteria, enable private investors with limited resources to invest in financial markets.
The first proposal
removes barriers to cross-border marketing of collective investment units by widening the range of assets in which they can invest.
The second proposal
gives management companies a %%%%European passport%%%% to operate throughout the EU and widens the activities which they can engage in. It also introduces the concept of a simplified prospectus which will strengthen investor protection by providing more accessible and comprehensive information.
The proposal will be transmitted to the Council and Parliament for adoption under the codecision procedure