SFDR Level 2 – Irish Central Bank sets out fast track filing process

The Central Bank’s fast track process

In September (as we reported at the time), the Central Bank of Ireland (the Central Bank) confirmed that it would establish a fast track process for funds to make amendments to their documentation in good time ahead of 1 January 2023.

This is the date on which new Level 2 measures under the SFDR start to apply, which will result in updates to pre-contractual documentation for UCITS, RIAIFs and QIAIFs (“AIFs”) being needed.

For information on the SFDR RTS see our article here.

What has the Central Bank published now?

Through a series of nine Q&As, the Central Bank has now published details of the process by which UCITS ManCos and AIFMs can submit their pre-contractual document (prospectus/supplement) updates and certify compliance with the requirements via an attestation.

The Central Bank stresses that responsibility rests with the relevant UCITS ManCo or AIFM to ensure compliance with the applicable requirements and repeats its warning that it will review a sample of the submissions received.

What does the Central Bank say?

1. The relevant “Responsible Person” (see below) must certify that any amendments made are in accordance with:

• the SFDR Level 2 requirements
• amendments made to the investment policies and strategies to allow consistency with the disclosures included in the Annex. (This includes amendments to disclosures which were made to comply with requirements under the Level 1 text of SFDR and/or the Taxonomy Regulation and which now need to be amended so they are consistent with the SFDR Level 2 rules);
• product level Principal Adverse Impact (PAI) disclosures required for Article 6 funds; and/or
• amendments made to the prospectus or supplement to reflect
  • the European Commission Q&As on SFDR – see here and here
  • ESMA’s supervisory briefing - see here and
  • other clarifications published by the ESAs or the Central Bank in relation to the SFDR Level 2 requirements.

The confirmation should also

• attest that the revised documents do not contain any other amendments to the pre-contractual documentation
• be submitted (along with the relevant amended final dated documents) to SFDR@centralbank.ie by C.O.B. on the relevant date for automated noting by the Central Bank

The “Responsible Person”

• of a UCITS is the UCITS ManCo or the UCITS Self-Managed Investment Company (SMIC)
• of an AIF is the AIFM or the Internally Managed AIF
• of an AIF with a non-EU AIFM is the fund itself.

2. The email under which documents are submitted must follow the format:

[Article X] [Name of Management Company] [Name of Umbrella Fund/Standalone/Sub-Fund(s)]

The Article must be included so the Central Bank can easily identify the SFDR classification applicable to the relevant fund.

3. Filings must be made no later than 1 December 2022 – this deadline applies to all UCITS, RIAIFs and QIAIFs.

4. The streamlined process is only available for submission of

• SFDR Level 2 requirements and/or
• updates to ensure consistency with the disclosures included in the annex, PAI disclosures and other SFDR related updates that arise as a result of European Commission, ESAs or Central Bank clarification.

All other changes must comply with the usual Central Bank review process for the relevant fund.

5. Submissions which have already been filed with the Central Bank but are not clear of comment by the filing deadline (1 December 2022) will need to comply with the usual Central Bank review process. This is the case even where the submission is ultimately cleared of comment prior to 1 January 2023.

Where a submission is clear of comment before 1 December 2022 but not yet authorised, it will also need to comply with the usual Central Bank review process.

6. Where the SFDR related update also involves a change of name, the submission should be made via the Central Bank’s Portal in the usual manner.

A version of the streamlined process will apply in such cases, so long as the submission includes the attestation referred to above.

7. Where the SFDR related update also involves the reclassification of the fund, such a submission can be made using the streamlined process but must include a rationale for the reclassification.

8. Where a submission has been made to the Central Bank for the authorisation of a new fund / sub-fund, this will not qualify for the streamlined process - the disclosures made in relation to SFDR Level 2 requirements will be reviewed as part of the application.

9. After 1 January 2023, the streamlined process will not be available for SFDR Level 2 requirements. Submissions made after this date will be reviewed by the Central Bank and may be subject to comment.