ICI Comments on CESR's Role in Regulating UCITS, December 2003

Washington, DC, December 1, 2003 - The Institute recently commented on a consultation paper by the Committee of European Securities Regulators (CESR), which outlines the role of CESR in regulating and supervising Undertakings for Collective Investment in Transferable Securities (UCITS) and asset management activities in the European Union (EU).

Background
UCITS funds are European mutual funds that can be marketed in all EU countries. The UCITS Directive provides the framework for cross-border sales of investment funds in the European Union. The Directive allows a fund that qualifies under the Directive to be sold throughout the EU subject to regulation by its home country regulator.

background on the process by which CESR has become involved in the regulation and supervision of the asset management industry;
CESR's suggestions on areas of work and related priorities; and
an indication of the organization that CESR would like to put in place to address these issues.

ICI Position
In a recent comment letter, the Institute comments on the objectives described in the consultation paper.

The Institute fully supports a unified approach to the regulation and supervision of asset management activities across the EU. A truly pan-European UCITS market and asset management sector must include a harmonized regulatory approach. The Institute urges that asset management issues not be overlooked or overshadowed by other priorities, and that pension matters are distinct from insurance matters. The Institute recommends that pension issues be addressed in a separate sector committee or jointly with the European Securities Committee.

In addition, the Institute supports CESR's intention to take a global view of "buy-side" investor issues. The Institute states that there are numerous securities and other issues (including pension matters) that affect asset management and that it is important for CESR to consider those issues as they relate to the asset management sector. The Institute also urged the resolution of other important issues that have not been fully resolved by the UCITS Contact Committee.

The Institute believes CESR's highest priorities should be the harmonized implementation of the UCITS Directive and a common approach with respect to marketing rules for UCITS funds.