Template:Nutshell UCITS V 22a(3): Difference between revisions

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{{ucits5prov|22a(3)}}.  The {{ucits5prov|depositary}} may delegate its Art. {{ucits5prov|22(5)}} safekeeping function to a third party only where the delegate at all times: <br>
{{ucits5prov|22a(3)}}.  The {{ucits5prov|depositary}} may delegate safekeeping functions only where that delegate: <br>
:(a) is competent and equipped to properly hold the assets which have been entrusted to it; <br>
:(a) is competent to look after the assets of the [[UCITS]] given to it; <br>
:(b) for custody tasks referred to in point (a) of Article {{ucits5prov|22(5)}}, : <br>
:(b) where it holds custodiable assets, the delegate is properly prudentially regulated in its it its own jurisdiction and regularly audited on its custody holdings; <br>
::(i) is prudentially regulated, supervised and subject to minimum capital requirements in its own jurisdiction; <br>
:(c) effectively segregates the UCITS assets from its own assets and those of the {{ucits5prov|depositary}} so they can be clearly identified as belonging to clients of the depositary<ref>Does this leave the door open for omnibus segregation of different funds managed by the same depositary?</ref>; <br>  
::(ii) is regularly audited to ensure that it does actually hold the [[financial instrument]]s; <br>
:(d) takes steps to ensure that if it is insolvent, the {{ucits5prov|UCITS}}’s assets that it holds are isolated from its creditors; and <br>
:(c) segregates the {{ucits5prov|UCITS}}’ assets from its own assets and those of the {{ucits5prov|depositary}} so that it is always clear they belong to clients of a the {{ucits5prov|depositary}}; <br>  
:(e) complies generally with Articles {{ucits5prov|22(2)}}, {{ucits5prov|22(5)}}, {{ucits5prov|22(7)}} and {{ucits5prov|25}}.<br>
:(d) ensures that if the delegate becomes insolvent, {{ucits5prov|UCITS}} assets it holds are not available for distribution to the delegate’s creditors; and <br>
:Where local rules require financial instruments to be held by a local custodian and none are effectively regulated or audited, the {{ucits5prov|depositary}} may delegate to a non-compliant local custodian only as far as is required by those local rules, and only as long as there are no compliant local custodians, and only where:
:(e) complies with the general obligations and prohibitions laid down in Article {{ucits5prov|22(2)}}, {{ucits5prov|22(5)}} and {{ucits5prov|22(7)}} and in Article {{ucits5prov|25}}.<br>
:(a) the [[UCITS]] investors are informed of these circumstances and the associated risks before they invest; <br>
:Where local law requires [[financial instrument]]s to be held in custody by a local entity and no local entities satisfy the above delegation requirements, the {{ucits5prov|depositary}} may delegate its functions to such a local entity only as far as is required by local law and as long as there remain no local entities that satisfy the delegation requirements provided that:
:(b) the [[UCITS]] management company has instructed the {{ucits5prov|depositary}} to make the delegation. <br>
:(a) it informs investors of the relevant {{tag|UCITS}}, before investment, that such a delegation is required, why, and what risks it presents; <br>
:The delegate may sub-delegate on the same terms. In such a case, Article {{ucits5prov|24(2)}} shall apply ''[[mutatis mutandis]]'' to the relevant parties. <br>
:(b) the {{tag|UCITS}}, has instructed the {{ucits5prov|depositary}} to make such a delegation. <br>
:The delegate may sub-delegate those functions subject to the same requirements and Art. {{ucits5prov|24(2)}} will apply ''[[mutatis mutandis]]'' . <br>

Latest revision as of 13:30, 14 August 2024

22a(3). The depositary may delegate safekeeping functions only where that delegate:

(a) is competent to look after the assets of the UCITS given to it;
(b) where it holds custodiable assets, the delegate is properly prudentially regulated in its it its own jurisdiction and regularly audited on its custody holdings;
(c) effectively segregates the UCITS assets from its own assets and those of the depositary so they can be clearly identified as belonging to clients of the depositary[1];
(d) takes steps to ensure that if it is insolvent, the UCITS’s assets that it holds are isolated from its creditors; and
(e) complies generally with Articles 22(2), 22(5), 22(7) and 25.
Where local rules require financial instruments to be held by a local custodian and none are effectively regulated or audited, the depositary may delegate to a non-compliant local custodian only as far as is required by those local rules, and only as long as there are no compliant local custodians, and only where:
(a) the UCITS investors are informed of these circumstances and the associated risks before they invest;
(b) the UCITS management company has instructed the depositary to make the delegation.
The delegate may sub-delegate on the same terms. In such a case, Article 24(2) shall apply mutatis mutandis to the relevant parties.
  1. ↑ Does this leave the door open for omnibus segregation of different funds managed by the same depositary?
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