Template:Ucits delegaton versus aifmd delegation: Difference between revisions

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===Delegation of safekeeping under {{t|UCITS}} and {{t|AIFMD}} look kind of similar don’t they?===
===Custody delegation under {{t|UCITS}} and {{t|AIFMD}} looks kind of similar doesn’t it?===
Yes, they do. The textual differences betwixt {{t|UCITS}} (Art {{ucits5prov|22a}}) and {{t|AIFMD}} (Art {{aifmdprov|21(11)}}) are ''largely'' formal, or ''[[mutatis mutandis]]'' style. The main substantive differences are:
Yes, it does. The textual differences betwixt {{t|UCITS}} (Art {{ucits5prov|22a}}) and {{t|AIFMD}} (Art {{aifmdprov|21(11)}}) are ''largely'' formal, or ''[[mutatis mutandis]]'' in style. The substantive differences are that a {{t|UCITS}} {{ucits5prov|depositary}}:
*A {{t|UCITS}} {{ucits5prov|depositary}} is not allowed to reuse the UCITS’ assets at all, rather that only with prior notification and consent as under AIFMD;
*cannot [[reuse]] the UCITS’ assets ''at all'', whereas an AIFMD {{aifmdprov|depositary}} can, with prior notification and consent;
*A {{t|UCITS}} {{ucits5prov|depositary}}must take all necessary steps to ensure UCITS’ assets aren’t caught up in the bankruptcy estate of an insolvent custodian;
*must take all necessary steps to ensure {{t|UCITS}}’ assets aren’t caught up in the bankruptcy estate of an insolvent delegate custodian — there isn’t an equivalent provision under {{t|AIFMD}}, though perhaps you might imply it;
*Where a non-EEA jurisdiction requires use of a local custodian and no local entities satisfy the delegation requirements, {{t|UCITS}} investors must be notified of the risks of such a delegation and not just the fact or, and circumstances justifying, it.
*must notify {{t|UCITS}} investors of the risks of delegation where a non-EEA jurisdiction requires use of a local custodian and no local entities satisfy the delegation requirements and not just the fact of, and circumstances justifying, it.

Latest revision as of 16:50, 25 July 2019

Custody delegation under UCITS and AIFMD looks kind of similar doesn’t it?

Yes, it does. The textual differences betwixt UCITS (Art 22a) and AIFMD (Art 21(11)) are largely formal, or mutatis mutandis in style. The substantive differences are that a UCITS depositary:

  • cannot reuse the UCITS’ assets at all, whereas an AIFMD depositary can, with prior notification and consent;
  • must take all necessary steps to ensure UCITS’ assets aren’t caught up in the bankruptcy estate of an insolvent delegate custodian — there isn’t an equivalent provision under AIFMD, though perhaps you might imply it;
  • must notify UCITS investors of the risks of delegation where a non-EEA jurisdiction requires use of a local custodian and no local entities satisfy the delegation requirements and not just the fact of, and circumstances justifying, it.
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