The Capital Requirements Directives (2006/48/EC and 2006/49/EC combined) have been transposed into Irish law by the EC (Capital Adequacy of Investment Firms) Regulations 2006 and the EC (Capital Adequacy of Credit Institutions) Regulations 2006. Some of the key implications of the directives for firms are listed in this update.
The Irish Stock Exchange has published two new policy notes which introduce a number of important new provisions in relation to financial information to be included in listing particulars. These changes should greatly improve the listing process for many investment funds, reducing delays and eliminating the costs of preparing audits specifically for listing purposes.
The new authorization process for Irish domiciled qualifying investor funds is now in place. A fund can now be authorized in one day, provided that all relevant parties to it (the promoter, directors and service providers) are approved (ie, have the appropriate authorizations/approvals from the Financial Services Regulatory Authority) and that the fund itself reflects the agreed parameters.
The Markets in Financial Instruments Directive and its 'Level 2' implementing directive have now been implemented in Ireland by the European Communities (Markets in Financial Instruments) Regulations 2007. The regulations will take effect from November 1 2007.
Following extensive engagement between the Irish Financial Regulatory Authority and the Dutch securities regulator, it has been confirmed that the minister for finance in the Netherlands has designated Ireland as a 'state of equal supervision standard' under the Netherlands Act on Supervision of Collective Investment Schemes.
This update considers the obligations imposed on directors and other persons to disclose certain interests or rights in shares and debentures of companies incorporated in Ireland. It focuses on the rules applicable to public companies and listed collective investment schemes.
The Financial Regulator has recently issued its strategic plan, which is a roadmap for Irish financial services regulation until 2009. The Financial Regulator expects that the industry will implement good governance and sound risk management procedures, willingly engage with it as regulator and, most importantly, commit to protect consumers' interests.
The Department of Finance has published two draft statutory instruments in relation to EU Directives 2006/48/EC and 2006/49/EC on capital adequacy for investment firms and credit institutions. The regulations establish a new method for calculating the capital requirements for credit institutions and investment firms.
Irish firms likely to be affected by the EU Markets in Financial Instruments Directive have been receiving regular updates on its status from the Department of Finance. As the European Commission has recently formally adopted the Level 2 implementing measures for the directive, the Department of Finance has now published a statutory instrument for the implementation of the directive into Irish law.
Following the enactment of the Investment Funds, Companies and Miscellaneous Provisions Act 2005, the Financial Services Regulatory Authority has amended its notices and guidance notes in order to reflect the legislative amendments introduced by the act. One of the key amendments included in the act and the subsequent revised notices permits cross-investment by sub-funds of an umbrella structure.
Following a public consultation in June 2006, the Financial Services Regulatory Authority has confirmed that it will permit retail collective investment schemes to charge an annual management fee based on the initial issue price of the units of the collective investment scheme, subject to certain requirements.
A recent change to Listing Rule 2.51 relating to the required frequency of redemption provisions in an open-ended fund has given the Irish Stock Exchange (ISE) more flexibility in its treatment of side pockets. In order to address the issues posed by side pocket investments, the ISE has also issued a policy note on side pockets by introducing a new Listing Rule 2.68.
Following consultation with industry participants, the Financial Services Regulatory Authority has issued revised undertakings for investment in transferable securities (UCITS) and non-UCITS notices. The authority has also issued revised versions of several guidance notes.
The Dublin Funds Industry Association has met with the Irish Financial Services Regulatory Authority to discuss the implementation of the European Communities (Undertakings for Collective Investment in Transferable Securities) (Amendment) Regulations 2006. Meanwhile, several changes have been negotiated with the authority which should lead to a much brighter future for regulated real estate funds.
A recent change to Listing Rule 2.51 with regard to the required frequency of redemption provisions in an open-ended fund has given the Irish Stock Exchange greater flexibility in its treatment of side pockets. This rule change is effective immediately.
The Irish Financial Services Regulatory Authority has made several amendments in recent months which should lead to a much brighter future for the development of regulated real estate funds in Ireland. The key change has been with regard to the holding of title to property assets, where the new regime is flexible but also clear.
Ireland's wish to portray itself as an investment-friendly location is demonstrated once again in the new Pension Regulations, giving effect to the EU Pensions Directive. The new regulations set out eligibility criteria for trustees and an obligation to provide a statement of investment policy procedure, which will enhance transparency and thus provide greater certainty in this area.
The Financial Regulator has delegated the review of EU Prospectus Directive-compliant prospectuses to the Irish Stock Exchange. The Irish Stock Exchange guarantees specific turnaround times on all documents submitted, which allows issuers to plan the timeline of their product launch accurately.
Lipper Fitzrovia's new Dublin Fund Encyclopaedia reveals that funds serviced in Ireland topped $950 billion (€785 billion) as at June 30 2005, reflecting annual growth of over 23% (up from $768.7 billion).
The Prospectus Directive and its implementation in Ireland have introduced a pan-European, cross-border mechanism for the public offer of securities. If an Irish company seeks to make an offer of its securities to the public and publishes a prospectus in the form required under the Irish Prospectus Regulations, it can offer its securities in other member states without further authorization.