Implementation Date of EU Directive May Vary Among Member States

Washington, DC, February 11, 2002 - The European Union (EU) has adopted amendments to the UCITS Directive. The amended directive will become effective when the European Commission publishes the final text in the Official Journal of the European Communities, which is expected sometime this month. Member states of the EU have 18 months from the date of publication to implement the amended directive into their national legislation. Several member states, including Luxembourg, already have been working on their national laws and will be ready to adopt legislation implementing the amended UCITS directive before the 18-month deadline.

Before the mid-2003 deadline for implementation of the new UCITS directive, it is possible that host member states that have not implemented the new directive will not accept a UCITS fund or management company operating under the new UCITS directive from another member state. Under EU law, member states are not legally obligated to accept a European passport issued in accordance with a directive before the deadline for implementation.

Whether any host member state would reject a UCITS passport created under the new directive during the implementation period is not clear. The European Commission has been asked to review the legal issue and is working to find a practical solution with the competent authorities of the member states. After the implementation period expires, all member states will be obligated to accept a UCITS passport from another member state.