COVID-19 - Irish regulator relaxes some deadlines for UCITS and AIFs

On 17 April 2020, the Central Bank of Ireland (the Central Bank) published a statement which provides some relief for managers of UCITS and AIFs, among others, while the financial services sector struggles with the challenges thrown up by the COVID-19 pandemic.

In its statement, the Central Bank:

• Allows investment firms, fund service providers and investment funds
  flexibility in the remittance dates of a number of their regulatory
  returns due over the COVID-19 period.

• Clarifies its expectations as to:

  • the deadlines by which assurance reports need to be submitted in
    respect of investment firms and fund service providers’ arrangements
    for the safeguarding of client assets or investor money;

  • the implementation date for risk mitigation programmes (RMP).

• Confirms that it is postponing its regular assessments of the
  domestic regulatory policy framework as far as securities markets,
  investment management activities and investment firms are concerned.

Looking at each of these in order:

Remittance dates

The Central Bank is allowing UCITS ManCos, AIFMs and MiFID firms flexibility in the deadlines for submitting a range of regulatory reports.

The extensions only apply to reports set out in tables which form part of the Central Bank’s statement – these cover both financial statements and capital requirements.

The extension period allowed is:

• two months in respect of Annual Audited Accounts which fall due
  between April and July 2020; and
• one month in respect of Capital Adequacy Returns where the reporting
  date is March to May 2020.

Some leeway is also allowed in the filing of annual audited financial statements and semi-annual financial statements under the Irish UCITS Regulations and Central Bank’s AIF Rulebook, provided that

• the returns fall within the parameters set out in Table B in the
  Central Bank’s statement; and
• the fund or its manager promptly notifies the Central Bank and
  informs investors as soon as practicable of the delay, the reasons
  for it, and as far as it can, the estimated publication date.

The Central Bank also flags up that it will be requiring firms to submit additional data so it can examine the effects of COVID-19 on the financial sector. Such requests will be targeted, measured and pragmatic and the Central Bank expects firms to respond to requests in an expedient manner.

Assurance reports

The Client Asset Requirements and Investor Money Requirements (which can be found in Parts 6 and 7 of the Central Bank Investment Firms Regulations), set out deadlines by which assurance reports must be submitted in respect of investment firms and fund service providers’ arrangements for the safeguarding of client assets or investor money.

The Central Bank is allowing a grace period for submissions which fall due between April and July 2020 (inclusive) where COVID-19 makes it impossible to comply with the deadline.

The extension being permitted is two months from the date on which the reporting obligation falls due.

An investment firm or fund service provider wishing to rely on this extension should notify its usual Client Asset Specialist Team (CAST) contact or email CAST (CAST@centralbank.ie) in good time, explaining why it is relying on the extension and, as far as it can, providing an estimated submission date.

Risk Mitigation Programmes (RMPs)

The Central Bank expects investment firms and fund service providers in a position to meet the existing RMP implementation dates, to continue to do so.
However, firms having difficulty in meeting specific RMP submission dates can engage directly with their usual supervisors, citing the reason for the difficulty. The supervisor will consider whether the postponement of such measures can be allowed on a case-by-case basis.

Updates to Regulatory Policy Frameworks

The Central Bank will delay updates to its domestic regulatory policy frameworks in respect of investment firms, fund service providers and investment funds – this includes delaying publication of the Central Bank’s feedback statement following CP130 (“Treatment, Correction and Redress of Errors in Investment Funds”).

Finally, the statement confirms that the Central Bank will apply a number of measures announced by ESMA and aimed at helping managers meet their regulatory obligations during the coronavirus pandemic.

See our coronavirus (COVID-19) feature for more information generally on the possible legal implications of COVID-19.