Press Release: Financial Services: European Commission welcomes adoption of two new Directives on investment funds (UCITS)

The European Commission has welcomed the adoption by the EU's Council of Finance Ministers on 4 December 2001, of the two Directives on harmonised investment funds (UCITS), one of the top priority actions of the Financial Services Action Plan. The first Directive removes barriers to cross-border marketing of units of collective investment funds by widening the scope of assets in which they can invest. The second Directive gives management companies a “European passport” to operate throughout the Union and widens the activities which they are allowed to undertake as non-core services. It also aims to set a level playing field with “self-managed investment companies” which have not designated a management company. Last, it introduces the concept of a simplified prospectus which will provide more accessible, comprehensive information to strengthen investor protection.