Funds Update - Ireland
Quarterly Update | April - June 2014

1 Legal & Regulatory

1.1 AIFMD Update

1.2 Irish Collective Asset-Management Vehicle Bill

1.3 Money Market Funds: Update

1.4 UCITS V Update


1.6 EMIR Update

1.7 PRIIPs KID Regulation

1.8 Prospectus Directive Update


1.10 Market Abuse and Criminal Sanctions

1.11 Regulation on European Long-Term Investment Funds

1.12 European Venture Capital Funds Regulation ITS

1.13 Capital Requirements Directive IV / Capital Requirements Regulation

1.14 Central Securities Depositaries Regulation

1.15 MMoU on Competent Authorities' Co-Operation Arrangements and Information Exchange

1.16 Corporate Governance Code for Credit Institutions and Insurance Undertakings - FAQ

1.17 Anti-Money Laundering

1.18 Investor Compensation Scheme Annual Levy

1.19 ACOI Paper on the Client Asset Regime

1.20 Non-Financial Reporting Directive

1.21 Shareholders Rights Directive

1.22 Statutory Audit Directive and Regulation

1.23 Financial Conglomerates Regulation

1.24 Central Bank Annual Report 2013

1.25 Data Protection Annual Report 2013

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2 Tax

2.1 FATCA Update

 Go to Tax section

3 Listing

3.1 Prospectus Handbook 2014 Updated and FAQ Published

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1 Legal & Regulatory

1.1 AIFMD Update

On 16 July 2013, the European Union (Alternative Investment Fund Managers) Regulations 2013 (No. 257 of 2013) gave effect to the Alternative Investment Fund Managers Directive (2011/61/EU) ("AIFMD") in Ireland.

There have been a number of developments over the quarter:

(a) On the 2 May 2014, the Central Bank of Ireland ("Central Bank") published a ninth edition of the AIFMD Q&A.  It answers queries likely to arise in relation to the implementation of AIFMD.  Amendments were made to question ID 1054 (unregulated master funds) and a new question ID 1071 was included.

New ID 1071

Q: I am an existing QIF/Retail Fund which must comply with the AIF Rulebook on authorisation of the alternative investment fund manager ("AIFM").  As a QIF/Retail Fund I previously sought and was granted certain derogations under the Non-UCITS regime.  Will these derogations cease to have validity once the AIF Rulebook is imposed on the QIF/Retail Fund?

A: Yes. Once an AIF becomes subject to the AIF Rulebook, derogations which have been granted to the AIF under the NU Series of Notices will no longer be valid or relevant, other than in the case outlined in ID 1054.  Any requests for derogations from the AIF Rulebook will be considered on a case-by-case basis, but will only be considered where the proposal includes a detailed and comprehensive rationale supporting the request.

Amended ID 1054

Under the Non-UCITS regime the Central Bank allowed QIFs, in certain circumstances, to invest up to 100% of their assets in unregulated master funds provided they obtained a Central Bank derogation under Guidance Note 1/01.  The Central Bank has clarified that although that derogation will not be available (because that Guidance Note 1/01 will become redundant once the fund becomes subject to the AIF Handbook) AIFs may continue to operate in accordance with the previously obtained derogation.

(b) The Central Bank also published an AIFMD reporting date matrix which outlines the differing reporting periods and dates for submission for authorised AIFMs, Non-EU AIFMs under the private placement regime and certain registered AIFMs and their AIFs.  An updated AIFM register was also published.

(c) On 30 May 2014, the Central Bank updated the Retail Investor AIF application form.

(d) On 20 June 2014, the European Securities and Markets Authority ("ESMA") published a table showing which competent authorities comply or intend to comply with its July 2013 guidelines on the model memorandum of understanding ("MoU") concerning consultation, cooperation and the exchange of information related to the supervision of AIFMD entities (ESMA/2014/264).

The table indicates that all member states have complied or intend to comply with its guidelines, with the exception of Slovenia.  The guidelines are not applicable to Slovenia because, as a consequence of the late transposition of AIFMD, no competent authority has yet been designated for Slovenia under Article 44 of AIFMD.  Gibraltar has not responded to ESMA.

(e) On 24 June 2014, Commission Delegated Regulation (EU) No 694/2014 of 17 December 2013 supplementing AIFMD with regard to regulatory technical standards determining types of AIFMs was published in the Official Journal of the EU.  It came into force on 14 July 2014.


On 27 June 2014, ESMA updated its Q&A on Application of AIFMD.  Q&As on the following issues have been inserted:

(i) Remuneration and the ability to exclude portfolio managers from the scope of identified staff for the purpose of ESMA's guidelines on sound remuneration policies under AIFMD.

(ii) Reporting and which countries are covered under references to the "EEA".

(iii) Reporting and which countries are covered under references to the "Union".

(iv) Reporting and what mandatory, optional and conditional categories mean.

(v) Notification of AIFMs and identification of existing AIFs.

(vi) Notification of AIFMs under Article 33 of the AIFMD without setting up AIFs.

(vii) Markets in Financial Instruments Directive (2004/39/EC) services under Article 6(4) of AIFMD and passport notifications.

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1.2 Irish Collective Asset-Management Vehicle Bill

On 29 July 2014, the Government published the Irish Collective Asset-management Vehicle ("ICAV") Bill.  It facilitates a new type of corporate investment fund vehicle which is tailored to meet the needs of the funds industry.  It will now commence the Irish parliamentary process in the autumn.

From a tax perspective, the Bill indicates that an ICAV will constitute an investment undertaking for the purposes of Section 739B of the Irish Taxes Act 1997.  Accordingly, the ICAV should be subject to the same tax exempt gross-roll up regime as most existing Irish regulated funds.  Further tax legislation implementing the ICAV is expected to be published.

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1.3 Money Market Funds - Update 

On 4 September 2013, the draft "Proposal for a Regulation of the European Parliament and of the Council on Money Market Funds" (the "draft Regulation") was published.  It contains radical new regulatory measures that will apply to European money market funds ("MMFs").

On 4 June 2014, the European Central Bank published an opinion on the draft Regulation.  It comments on matters including the following:

(i) The complementarity between the draft Regulation and the legal frameworks for UCITS and AIFMs.

(ii) Financial stability.

(iii) The constant net asset value of MMFs.

(iv) The provision of external support.

(v) Risk management of MMFs.

(vi) The role of MMFs in intermediation.

(vii) Internal rating systems.

(viii) Reporting requirements for MMFs.

Of particular note are the following:

  • The European Central Bank ("ECB") notes the importance of having convergence between money market fund regulations in the EU and the US.  And while the ECB opinion references a risk-based net asset value ("NAV") buffer as one policy option that was earlier proposed in a US context, the most notable point here is that the main measures proposed so far on the US side by the US Securities and Exchange Commission (which include liquidity fees and redemption gates) do not include a NAV buffer.  This could be very significant in that the ECB clearly wishes to avoid the "potential regulatory arbitrage" that would result if the EU regulation requires a NAV buffer and the US regulation does not.
  • It is also notable that the ECB raises concerns around the proposed NAV buffer not being risk based, so clearly favours a risk-based buffer.  This could have positive implications for lower risk money market funds if a buffer was set relative to the risk levels of the portfolio – rather than the current proposed hard level of 3%.

The European Parliament is expected to resume examination of the draft Regulation in the autumn.

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1.4 UCITS V Update

UCITS V consists of proposed reforms to the UCITS regime intended to address issues relating to the depositary function, manager remuneration and administrative sanctions.  On 15 April 2014, the European Parliament adopted the draft UCITS V Directive (the "UCITS V").

On 15 April 2014, the Parliament voted in plenary to adopt UCITS V at first reading and it was adopted by the Council of the EU on 23 July 2014.  The Council also published a revised text of UCITS V.

Once published in the Official Journal, EU Member States will have 18 months to transpose UCITS V into national law and depositories will be given an additional 24-month transition period after the transposition deadline.

For further details please see our client update, UCITS V Directive: Impact Assessment

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On 30 May 2014, the Central Bank published a second edition of its UCITS Q&A document.  It contains new questions, ID 1009 and ID 1010 summarised as follows:

  • The Central Bank will now permit UCITS and Retail AIFs to invest up to 100% in securities issued by the government of the People’s Republic of China.
  • Guidance is also given on the process going forward in relation to adding new permitted markets (pending the issue of a new UCITS Rulebook) whereby funds should self-assess the appropriateness of any proposed market.  The Central Bank will not review submissions but reserves the right to review any assessment made by a fund.

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1.6 EMIR Update

On 10 April 2014, the European Commission published a consultation paper on FX financial instruments regarding the delineation between FX forward contracts and FX spot contracts under the Markets in Financial Instruments ("MiFID") Directive.  10 questions were raised in the consultation paper and the European Commission received 79 responses including notable responses from the Investment Management Association ("IMA"), ESMA's Securities and Markets Stakeholder Group and the Alternative Investment Management Association ("AIMA").

On 14 April 2014, the Joint Committee of the European Supervisory Authorities published a joint consultation (JC/CP/2014/03) on draft regulatory technical standards on risk mitigation techniques for over-the-counter ("OTC") derivative contracts not cleared by a central counterparty under Article 11(15) of EMIR (Regulation on OTC derivative transactions, central counterparties ("CCPs") and trade repositories (Regulation 648/2012)), with a particular focus on the quality and exchange of margin underpinning those transactions.

For those OTC derivatives contracts that are sufficiently standardised and trade products for which pricing is sufficiently reliable, a clearing obligation will be introduced in the coming months with the aim of mitigating counterparty credit risk.

The clearing obligation will apply to financial counterparties (which term automatically includes UCITS and AIFs with an authorised or registered AIFM) and non-financial counterparties with the requisite exposure levels to OTC derivatives.  Both counterparties to an OTC derivatives contract must be subject to the clearing obligation in order for it to apply.  The first authorisation of an EU-based CCP (on 18 March 2014) triggered a requirement under EMIR for ESMA to draft technical standards within six months that will define the classes of derivatives subject to central clearing.  Compulsory clearing will only start with the entry into force of these technical standards, which will also create the need to "frontload" derivative trades entered into since 18 March 2014 provided they have a remaining maturity above the minimum to be determined by the Commission.

On 8 May 2014, ESMA published a letter it sent to the European Commission setting out its intention to ease certain frontloading requirements under EMIR clearing obligation.  The frontloading requirement is the obligation to clear certain OTC derivative contracts entered into after a CCP has been authorised under EMIR but before the date of application of the clearing obligation.  Under the frontloading rules, a contract concluded on a bilateral basis following authorisation of a CCP might become subject to the central clearing obligation provided it has a remaining maturity above the minimum period, which as noted is yet to be determined in regulatory technical standards to be adopted by the Commission.

ESMA believes that the frontloading procedure creates uncertainties for derivatives end-users while the exact terms of the clearing obligation have not been defined.  This could have adverse impact on risk hedging (parties may wish to avoid a potential clearing obligation for hedging transactions later) and consequently financial stability.  The requirement to post collateral with a CCP will have an impact on pricing (and consequently bid-offer spreads).  ESMA therefore intends to establish the frontloading requirement in a way that will minimise the uncertainty: by restricting retrospective application to OTC derivatives contracts concluded after adoption of the regulatory technical standards (defining relevant products and necessary maturity) but before the date of application of the clearing obligation (which is to be phased in under the RTS).

On 13 May 2014, the text of Regulation 484/2014, a Commission implementing Regulation on the hypothetical capital of a CCP according to EMIR was published in the Official Journal of the EU.  It relates to the provisions in Articles 50a, 50c and 89(5A) of EMIR, as amended by Article 520 of the Capital Requirements Regulation (Regulation 575/2013) ("CRR").  It applies from 2 June 2014, except for Articles 1(3), 2(3) and 3, which apply from 1 January 2015.

On 20 May 2014, ESMA added two more clearing houses - Italy’s Cassa di Compensazione e Garanzia (CC&G) and France’s LCH.Clearnet SA to its list of CCPs authorised under EMIR bringing the total CCPs authorised to six.

On 21 May 2014 and 23 June 2014, ESMA published updated versions of its Q&A document (ESMA/2014/550) on the implementation of EMIR.  The updates include a table of questions on pages 6 to 8, detailing which questions and answers have been added or updated as at a particular date, and to which Article(s) in EMIR the updated questions relate.

The May update concerns the following topics:

  • Funds, counterparties (general question).
  • Status of counterparties covered by AIFMD (general question).
  • Authorised or registered AIFMs (OTC question).
  • Calculation of the clearing threshold (OTC question).
  • Intragroup transactions (OTC question).
  • Public register (OTC question).
  • Classification of non-EU central banks (OTC question).
  • Segregation and portability (CCP question).
  • Organisational requirements (CCP question).
  • Risk committee (CCP question).
  • Prudential requirements (CCP question).

The June update provides answers mostly in relation to the population of specific fields relating to reporting of data on exposures (i.e. collateral and valuations).  The reporting start date for such data is 11 August 2014, which means that the first counterparties reports on those fields are due no later than the end of 12 August 2014.  It also covers how to report contracts with no maturity date, notional amount field, OTC derivatives novations and the issue of backloading.

On 28 May 2014, ESMA published an opinion (ESMA/2014/576) on voting procedures for CCP colleges under EMIR.

On 30 May 2014, the European Fund and Asset Management Association ("EFAMA") issued its response to questions raised in ESMA's Consultation for Draft Regulatory Technical Standards relating to the notification of major shareholdings and the indicative list of financial instruments subject to notification requirements under the Transparency Directive.  The response highlighted that the application of the Directive must be harmonised across all EU Member States, noting that the implementation of the Draft Regulatory Technical Standards is a suitable mechanism to ensure the level transposition.  Further, EFAMA noted the requirement for proportionate standards in order to deliver the desired level of transparency without the effect of placing an undue burden on market participants.

On 4 June 2014, the European Commission updated a webpage to announce that on 3 June 2014, it adopted implementing Regulation 591/2014 on the extension of transitional periods related to own funds requirements for exposures to under the CRR and EMIR.  Also on 4 June 2014, the text of the Regulation was published in the Official Journal of the EU and came into force on 5 June 2014.  The 15 month periods referred to in the first and second subparagraph of Article 89(5a) of EMIR, respectively, are extended by six months.

On 19 June 2014, a European Commission delegated Regulation (Regulation 667/2014) supplementing EMIR with regard to rules of procedure for penalties imposed on trade repositories by ESMA was published in the Official Journal of the EU and entered into force on 22 June 2014.

On 23 June 2014, ESMA published an updated version of its Q&A document regarding the implementation of EMIR.  The latest Q&A addresses questions in relation to the population of specific fields relating to reporting of data on exposures (i.e. collateral and valuations).  The reporting start date for this data is 11 August 2014 which means that the first counterparties reports are due not later than 12 August 2014.  The Q&A also addresses how to report contracts with no maturity date; notional amount field; OTC derivatives novations and the issue of backloading.

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1.7 PRIIPs KID Regulation

The European Parliament adopted the proposed Regulation on key information documents ("KIDs") for packaged retail and insurance-based investment products ("PRIIPs") ("PRIIPs KID Regulation") at a first reading on 15 April 2014 following political agreement on 1 April 2014.  It will introduce a new pan-European pre-contractual product disclosure document for PRIIPS (previously known as PRIPS).

The next step will be for the Council of the EU to adopt it at first reading, following which the Regulation will be published in the Official Journal of the EU and enter into force 20 days later.

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1.8 Prospectus Directive Update

On 22 May 2014, the Omnibus II Directive, which, among other things, will amend the Prospectus Directive in respect of the powers of ESMA, was published in the Official Journal.  The Directive entered into force on 23 May 2014 and must be transposed into national law and regulation by 31 March 2015 and applied from 1 January 2016.

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On 15 April 2014, the European Parliament voted to approve the Level 1 texts of an amended Markets in Financial Instruments Directive ("MiFID II") and new Markets in Financial Instruments Regulation ("MiFIR").  MiFIDII/MiFIR together repeal the original Markets in Financial Instruments Directive (2004/39/EC) and also amend EMIR.

On 13 May 2014, the Council adopted MiFIDII/MiFIR.

On 16 May 2014, the European Commission requested technical advice from the European Banking Authority ("EBA") on possible delegated acts concerning product intervention by competent authorities.  The European Commission has already asked ESMA for similar advice and it is expected that the response from the EBA will be similar if not identical to that from ESMA.

On 22 May 2014, ESMA published a consultation paper (ESMA/2014/549) and discussion paper (ESMA/2014/548) as the start of its consultation process for implementation of MiFIR.

The paper asks for comments on key issues to enable ESMA to produce technical advice to the European Commission to assist the Commission in making the delegated acts required by several provisions of the MiFID II and MiFIR.  The discussion paper seeks views on some more innovative or technically complex elements of draft regulatory technical standards and implementing technical standards that ESMA is required under MiFID II and MiFIR to develop for submission to the Commission.  The closing date for responses to both papers is 1 August 2014.

On 12 June 2014, the texts of MiFIDII/MiFIR were published in the Official Journal and enter into force on 2 July 2014.

EU Member States must adopt and publish by 3 July 2016 the measures transposing MiFID II into national law and must apply those provisions from 3 July 2017.  The only exceptions are in relation to the provisions transposing Article 65(2), which will apply from 3 September 2018, and the measures referred to in Article 92 (amendments to AIFMD) which will apply from 3 July 2015.

MiFIR will apply from 3 July 2017, with the exception of certain provisions detailed in Article 55 which will apply immediately on MiFIR's entry into force and Article 37(1), (2) and (3), which will apply from 3 January 2019.

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1.10 Market Abuse and Criminal Sanctions

On 23 April 2014, the Council of the EU published the adopted text of the MAD II legislative package following EU Parliament approval on 15 April 2014:

(i) The Market Abuse Regulation ("MAR").

(ii) The Directive on criminal sanctions for market abuse ("CSMAD").

MAR and CSMAD were published in the Official Journal of the EU on 12 June 2014.  Both entered into force on 2 July 2014.  MAR will apply from 3 July 2016 (save for certain provisions specified in Article 39, which were applied on 2 July 2014).

Member states have until 3 July 2016 to transpose CSMAD into their national law (but not the UK, which has opted out).

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1.11 Regulation on European Long-Term Investment Funds

On 23 June 2014, the Council of the EU published a note (11105/14) (dated 20 June 2014) from the General Secretariat to COREPER setting out its general approach on the proposed Regulation on European Long-Term Investment Funds ("ELTIF Regulation").  It is designed to provide a framework for retail investment in illiquid asset classes such as infrastructure projects and unlisted companies.

On 25 June 2014, COREPER agreed, on behalf of the Council, its position on the ELTIF Regulation.  It also invited the incoming Italian presidency to start negotiations with the Parliament, on the basis of the Council's general approach, so as to enable adoption of the texts at first reading.  The Parliament is expected to resume examination of the ELTIF Regulation in the autumn.

For more detail see our client update, European Long Term Investment Funds - Assessment of EU proposals

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1.12 European Venture Capital Funds Regulation ITS

On 4 June 2014, Regulation 593/2014 laying down implementing technical standards ("ITS") to determine the format of notification under Article 16 of the European Venture Capital Funds (Regulation 345/2013) ("EuVECA Regulation") was published.  The EuVECA Regulation applies from 22 July 2013 and introduces a marketing passport to allow fund managers to market qualifying venture capital funds to EU investors using the EuVECA designation.  The EuVECA Regulation applies to managers of EU AIFs that meet certain conditions regarding assets under management and home registration requirements and manage qualifying venture capital funds.

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1.13 Capital Requirements Directive IV / Capital Requirements Regulation

On 31 March 2014, the European Union (Capital Requirements) Regulations 2014 gave effect to the Capital Requirements Directive (Directive 2013/36/EU) ("CRD IV") and the European Union (Capital Requirements) (No. 2) Regulations 2014 ("CRR") gave effect to a number of technical requirements in order that the CRR can operate effectively in Irish law.

CRD IV introduces a number of capital buffers including the capital conservation buffer and the countercyclical capital buffer.  These requirements apply to investment firms that are authorised to provide the MiFID investment services and activities of 'dealing on own account' and/or 'underwriting of financial instruments and/or placing of financial instruments on a firm commitment basis'.  Regulation 120 of the European Union (Capital Requirements) Regulations 2014 provides that the Central Bank has the discretion to exempt small and medium-sized investment firms from the requirement to hold such an exemption provided it does not threaten the stability of the financial system of the Member State.  The Central Bank intends to consult on its policy proposal in relation to these discretions.

On 21 May 2014, the Central Bank updated its Implementation Notice on Competent Authority Discretions and Options in CRD IV and CRR.  This sets out the Central Bank approach in relation to provisions contained within CRD IV and CRR, as transposed into Irish law, where the competent authority can or must exercise its discretion.  It does not provide guidance on discretions and options which have not been transposed into national law.  Decision making relating to Member State discretions and options not allocated to the Central Bank will be a matter for the Minister for Finance.

On 3 June 2014, the European Commission adopted the implementing Regulation on the extension of transitional periods related to own funds requirements for exposures to CCPs.  The extension permits institutions to consider a CCP as a qualified central counterparty ("QCCP") under CRR (which attracts a lower charge than exposures to CCPs without QCCP status).

On 13 June 2014, the Central Bank published consultation paper 81/2014 ("CP81") on possible exemption from capital buffers for SME investment firms from CRD IV/CRR.  CP81 signals the CBI's approach and perspectives to SME investment firms from being subject to the capital conservation buffer as well as the introduction of the countercyclical capital buffer in line with CRD IV and CRR.  The consultation period ends on 12 September 2014.

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1.14 Central Securities Depositaries Regulation

On 15 April 2014, the European Parliament published the provisional text of the new Central Securities Depositaries Regulation.  The Regulation has been drafted to improve and increase the safety of settlements, the efficiency of settlements and the safety of Central Securities Depositaries ("CSDs").  The key aspects of the Regulation are:

  • Shorter settlement periods;
  • Deterrent settlement discipline measures (mandatory cash penalties and 'buy-ins' for settlement fails);
  • Strict prudential and conduct of business rules for CSDs;
  • Increased prudential and supervisory requirements for CSDs and other institutions which provide banking services ancillary to securities settlement; and
  • Strict access rights to CSD services.

Following the adoption by Parliament, the Regulation must be formally approved by Council and published in the Official Journal of the EU, which is expected to occur in Q3 2014.

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1.15 MMoU on Competent Authorities' Co-Operation Arrangements and Information Exchange

On 6 June 2014, ESMA published a multilateral memorandum of understanding ("MMoU") on co-operation arrangements and information exchange between competent authorities and between competent authorities and ESMA (ESMA/2014/608).

ESMA published guidelines relating to the MMoU in March 2013.  The text of the MMoU was set out in an Annex to the guidelines.  Among other things, the guidelines stated that the MMoU comes into force two months after the publication of the guidelines.

ESMA has also published a list of signatories to the MMoU, which includes the Central Bank.

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1.16 Corporate Governance Code for Credit Institutions and Insurance Undertakings - FAQ

The Central Bank has published a FAQ guide on the revised Corporate Governance Code for Credit Institutions and Insurance Undertakings 2013, which is due to take effect on 1 January 2015.  The existing Corporate Governance Code and FAQ guide (issued in 2011) will continue to apply in the interim period.

The Central Bank has indicated that the FAQ guide reflects questions which have been raised in relation to the Code.

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1.17 Anti-Money Laundering

On 30 April 2014, the Central Bank published its Annual Performance Statement Financial Regulation 2013-2014.  As part of its strategy for the rest of 2014, the Central Bank intends to undertake three detailed inspections, 24 standard inspections and a number of risk evaluations in regards authorised firms' compliance with anti-money laundering and counter-terrorist financing provisions in the Criminal Justice (Money Laundering and Terrorist Financing) Act 2010 (as amended).  Further, the Central Bank will publish a number of thematic reports by sector indicating both good and poor practice identified during its reviews and inspections.

On 18 June 2014, the EU Council announced that all EU Member States had agreed a general approach on the proposed 4th Money Laundering Directive (the "Directive").  The agreement paves the way for the commencement of trilogue negotiations between the Parliament, the Council and the Commission on the final content of the Directive as well as the associated Wire Transfer Regulation.

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1.18 Investor Compensation Scheme Annual Levy

In line with the National Payments Plan, the Investor Compensation Company Limited ("ICCL") requires that from 1 August 2014, authorised investment firms must pay their annual levy by electronic funds transfer.  Levy notices issued to investment firms will contain the relevant ICCL bank details to make payment.  Investment firms should prepare for this change to ensure compliance with the Investor Compensation Act 1998.

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1.19 ACOI Paper on the Client Asset Regime

On 2 April 2014, Rosemary Hanna, Head of Fund Authorisation and Supervision addressed the Association of Compliance Officers in Ireland ("ACOI") on the subject of the Client Asset Regime.  The briefing followed the Central Bank's consultation on the Client Asset Regime and Ms. Hanna addressed the related Central Bank consultation paper and the industry response; the application of the regime to fund service providers ("FSPs"); the seven key principles underpinning the regime; and the next steps in the application of the regime.

Ms. Hanna focused the address on the impact that the new Client Asset Regime will have on the operation of collection accounts by FSPs, noting that the rationale for the extension of the regime to collection accounts is to ensure protection of investor's funds whilst they remain in collection accounts on subscriptions in and redemptions from a fund.

Concluding the brief, Ms. Hanna acknowledged concerns expressed by the industry to the consultation and stressed that the Central Bank will continue to engage with the funds industry in the drafting of the relevant legislation and guidance notes, which are expected to be finalised this year.

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1.20 Non-Financial Reporting Directive

On 15 April 2014, the European Parliament adopted the Non-Financial Reporting Directive which requires larger European entities to disclose information on aspects considered non-financial such as environmental issues, social and employee-related policies, board diversity, human rights protocols and anti-corruption and bribery measures.  The Directive affirms to be flexible in its remit ensuring that the administrative burden is not too high and permits scope in terms of the reports to be provided by such entities.  The Directive is expected to be implemented in 2016.

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1.21 Shareholders Rights Directive

On 9 April 2014, the European Commission in an attempt to promote and enhance the long-term sustainability of EU entities proposed the Shareholders Rights Directive.  The Directive intends to increase transparency and reduce corporate governance shortcomings relating to listed companies and their boards, intermediaries, shareholders and proxy advisors.  The Directive is due to be submitted to the European Parliament before the end of 2014.

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1.22 Statutory Audit Directive and Regulation

On 27 May 2014, the revised Statutory Audit Directive and Regulation were published in the Official Journal of the EU, The new legislation increases audit quality, promotes transparency and accountability of audits and creates a more dynamic and better supervised audit market.  Specifically, the new legislation reduces the perceived conflict of interest issues between audit firms and public-interest entities ("PIEs") by requiring the rotation of audit firms for PIEs and the restriction on the provision of some non-audit services that an audit firm can provide to a PIE.  The Enhanced Framework package is due to enter into force on 17 June 2016.

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1.23 Financial Conglomerates Regulation

On 3 April 2014, the supplementing Financial Conglomerates Regulation with regard to regulatory technical standards for the application of the calculation methods of capital adequacy requirements for financial conglomerates was published in the Official Journal of the EU and came into force on 23 April 2014.

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1.24 Central Bank Annual Report 2013

On 30 April 2014, the Central Bank published its Annual Report 2013.  As well as setting out the annual accounts of the Central Bank, the report notes the key developments and activities from 2013 and covers the following:

(a) Stability of the Financial System.

(b) Proper and Effective Regulation of Financial Institutions and Markets.

(c) Resolution of Financial Difficulties in Credit Institutions.

(d) Protection of Consumers of Financial Services.

(e) Independent Economic Advice and High Quality Financial Statistics.

(f) Efficient and Effective Payment Systems and Currency Services.

(g) Operational Efficiency and Cost Effectiveness.

(h) Ireland’s Financial Sector Commitments under the External EU-IMF Programme of Financial Support.

(i) Energy, Safety and Environmental Developments.

(j) Statements and Published Papers by the Bank in 2013.

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1.25 Data Protection Annual Report 2013

On 12 May 2014, the Data Protection Commissioner ("DPC") published the 25th Annual Data Protection Report 2013 noting, amongst other things, the reduction in the overall number of complaints to the DPC from 1,349 in 2012 to 910 in 2013.

The report also notes that 517 of these complaints were made in relation to data access requests.  Further, the DPC recorded 1,507 data breach notifications in 2013.

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2 Tax

2.1 FATCA Update

The US led information sharing initiative introduced under the Foreign Account Tax Compliance Act ("FATCA") went "live" from 1 July 2014.  The Irish implementing regulations, the Financial Accounts Reporting (United States of America) Regulations 2014 (the "Final Regulations") were published on 30 June 2014.

The Final Regulations contain a number of clarifications and additions and also confirmed that Reporting Irish Financial Institutions have until 31 December 2014 to register for a Global Intermediary Identification Number (“GIIN”) with the US Internal Revenue Service ("IRS") and that the first annual return date for Reporting Irish Financial Institutions to make their reports to Irish Revenue is 30 June 2015.

From 1 July 2014, all Irish funds which are Reporting Financial Institutions for FATCA purposes need to comply with the due diligence obligations set out in the Ireland / US Intergovernmental Agreement.  These obligations provide for the inclusion of self-certification language in subscription and application forms.

For further information in relation to the self-certification and due diligence requirements imposed on Irish funds by FATCA or to discuss any aspect of FATCA, please ask your usual Maples contact who will put you in touch with one of our Tax Group.

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3 Listings

3.1 Prospectus Handbook 2014 Updated and FAQ Published

The Commission Delegated Regulation (EU) No 382 of 2014 supplements Directive 2003/71/EC of the European Parliament and of the Council with regard to regulatory technical standards for publication of supplements to the prospectus.

The online Prospectus Handbook has been updated accordingly and re-dated 2014.

Changes made include the addition of paragraphs relating to mandatory supplements.  In addition, Annex 6 referring to the ESMA's Common Positions has been deleted.  A reference to ESMA'S Questions and Answers of Prospectuses has been inserted but the content has not been included as this is subject to regular updates.

The effective date of the 2014 Handbook was 5 May 2014.

This Prospectus Handbook is divided into sections with each section highlighting a different aspect of the prospectus review, approval and publication process.  All sections ultimately link together and should be read in conjunction with one another.  Further detail in respect of the content of each section is set out below:

(a) Section One provides an overview of the requirements relating to the structure and content of a prospectus.

(b) Section Two sets out details of the procedures to be followed by a relevant person, or their agent, regarding the drawing up, approval and publication of a prospectus to be published when an offer is made and/or securities are admitted to trading.

(c) Section Three contains additional guidance regarding various aspects of the prospectus review, approval and publication process beyond that included in the Rules.
The Annexes to this Prospectus Handbook contain the following source materials which will assist issuers and market participants with the prospectus review, approval and publication process:

(i) Annex 1 - Prospectus Rules;
(ii) Annex 2 - Prospectus Fees;
(iii) Annex 3 - Submission Timelines; and
(iv) Annex 4 - Template Emails, Letters and Forms as follows: new submission email; redraft submission email, approval submission email; final terms submission email; Article 8 submission email; passporting request letter; transfer of approval letter: and account information form.

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© Maples and Calder 2014

This update is intended to provide only general information for the clients and professional contacts of Maples and Calder. It does not purport to be comprehensive or to render legal advice.



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