ESMA outlines future regulatory framework for ETFs and other UCITS issues

30 January 2012

ESMA published a consultation paper setting out future guidelines on UCITS exchange-traded funds and other UCITS-related issues. The proposals cover both synthetic and physical UCITS ETFs, and detail the obligations to come for UCITS ETFs.

ESMA’s proposals go wider than ETFs and cover such areas as the use of total return swaps by any UCITS, for which ESMA envisages additional obligations with respect to the collateral to be provided, or UCITS investing in strategy indices, where the requirements on eligibility of such indices have been tightened. The proposals also include placing an obligation on UCITS ETFs to use an identifier and facilitating the ability of investors to redeem their shares, whether in the secondary market or directly with the ETF provider. For further information, please also see the press release.

Comments to this consultation paper are welcome by 30 March, 2012.

Full consultation paper

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