Press Release: Financial services: Commission consults on shape of possible changes to EU framework for retail investment funds (UCITS)

The European Commission has published initial orientations outlining the form of possible adjustments to the EU Single Market framework for investment funds – the UCITS Directive. The envisaged changes are needed in order to facilitate market-driven restructuring and boost efficiency in the dynamic but fragmented European fund market. The material published sets out initial suggestions on how to facilitate cross-border marketing of funds; build scale and liquidity by supporting fund mergers and asset pooling; allow fund managers to manage funds domiciled in another Member State; simplify and improve product disclosures; and strengthen supervisory cooperation mechanisms. These changes to the Directive were announced in the Commission White Paper of November 2006 (IP/06/1569). The consultation launched on 22 March 2007 seeks to mobilise regulatory, commercial and user expertise to ensure the technical soundness of the Commission's subsequent formal proposal. Deadline for comments is 15 June 2007. The Commission will finalise its formal proposal end 2007.