SFDR – the Central Bank of Ireland confirms use of fast track filing

On 1 January 2023, the long awaited Level 2 measures under SFDR come into effect.

Among other things, these will require affected funds to make amendments to their fund documentation, including their prospectuses.

To help with this process, the Central Bank of Ireland (the Central Bank) has announced that it will use a fast-track process – the deadline for filing will be 1 December 2022.

This will be along the lines of the fast track process which the Central Bank has used in the past – our summary from that time can be found here.

Among other things, we understand that

• as before, the Central Bank will conduct a sample review of filings
• an attestation will be needed that the changes relate to SFDR only
• managers will need to submit a covering letter in which they identify and provide a rationale for any changes being made to align with SFDR and recent related EU level clarifications (see below)
• the Central Bank will allow fund re-classifications under the fast-track process. However, in such cases, the manager must explain the rationale for the change in its covering letter
• for technical reasons, pre-contractual disclosures should be submitted as standalone pdfs, separate from the prospectus

It is likely that further details around the fast track process will be made public in due course – we will, of course, provide updates on these as they occur.

The Central Bank’s move, which we welcome, comes as regulators and industry gear up for the introduction of SFDR. Since late May, for example, we have seen:

• the European Commission’s responses to questions from the European Supervisory Authorities (ESAs) on interpretation of aspects of the SFDR and the Taxonomy Regulation
• ESA clarification of aspects of the SFDR Level 2 measures
• Publication of the final Level 2 Regulatory Technical Standards under SFDR
• ESMA’s Supervisory Briefing on implementation of the SFDR

For further information on the EU’s ESG framework generally, please see our online resources here and here or speak to your usual Simmons contact.