The opinion of… Yann de Saint-Meleuc, Associate Director, Finance Department, Euroland Consulting

Ucits IV does not resolve operational difficulties

le 15/06/2012 L'AGEFI Hebdo

What is the trend as regards the production of KIIDs (key investor information documents): in-house or outsourced?

The production of KIIDs can be organised in several ways: either fully in-house or fully outsourced, with an intermediate solution which involves using an outside service provider solely for publishing and distributing the KIIDs. Moreover, it is a tactical choice for each asset management company, irrespective of the volume of assets under management and the number of KIIDs to be produced. On the other hand, the company’s commercial focus governs the speed of the transition to KIIDs: structures which have a strong international focus have in general produced their documents more rapidly than purely domestic asset management companies.

Which types of asset management companies have benefited the most from the innovations introduced by the Ucits IV directive?

Ucits IV facilitates the distribution of funds throughout Europe. From this point of view, this directive is a non-event for Franco-French asset management companies that produce and sell their funds in France. On the other hand, the directive represents a step forward for internationally-geared structures, irrespective of their size, but it is not a revolution. The procedures are simpler, quicker and therefore cheaper. The real beneficiaries are the small and medium-sized asset management companies which have just begun to diversify their fund marketing outside their home country. For them, Ucits IV represents a real opportunity to accelerate their development by reducing the cost of branching out internationally.

Does the Ucits IV directive dismantle European borders?

Absolutely not. It is easier to distribute products with the simplification of cross-border registration, the management company passport and cross-border master-feeder structures. But this in no way resolves the operational difficulties, that is to say fund processing, which remains very complex when several countries are involved. A lot still remains to be done to improve the administrative chain between the various parties based in different countries, especially if the management company wants to be able to identify its foreign investors.

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