It found that:

·         the number of management companies will decrease

·         a new wave of fund mergers lies ahead

·         master/feeder structures will be key for new markets/client segments and

·         immediate cost savings are expected

 

According to the survey, the introduction of the Management Company Passport is one of the most landscape-altering changes permitted under the new directive. The results highlight how managers will reduce the number of management companies and will need to consider the location of a centralized management company carefully, taking into account concerns surrounding tax regime (49 per cent), the regulatory framework (44 per cent) and the availability of qualified personnel (33 per cent). Luxembourg (43 per cent) and Dublin (18 per cent) will be likely winners but the location of the group headquarters (23 per cent) is also an important consideration. 

 

The study revealed that 49 per cent of respondents plan to restructure their fund ranges, with sub-optimal fund size and high costs to investors being key drivers. While Ucits IV will facilitate cross-border fund mergers, the market may also see a large number of new feeder funds which, as highlighted in the survey, will be used for targeted fund distribution and will enable managers to enter new markets and segments. Again, Luxembourg (81 per cent) is the preferred location for consolidating assets in master/feeder fund structures. 

 

By far the most important advantage to UCITS IV for those asset managers polled is cost savings (43 per cent). Easier access to markets (24 per cent) and increased competitiveness (21 per cent) were also highlighted as positive outcomes of the new framework. Only two per cent of respondents said that UCITS IV brings no advantages; however, 45 per cent acknowledged the absence of a tax framework is a key issue.