Central Bank of Ireland publishes Markets Update No 14 (December 2022)

On 21 December 2022, the Central Bank of Ireland (the Central Bank) published Issue 14 of its regular Markets Update, in which it sets out alerts of interest to Irish regulated firms and other market participants.

For our summaries of the previous issues, please see the right-hand column of this page.

Of the various items covered in this Issue, we would highlight, in particular, the following:

Central Bank publications

• Central Bank of Ireland publishes 37th Edition of the UCITS Q&A

  On 21 December 2022, the Central Bank published the 37th Edition of its Q&As on the UCITS Directive.

  This update looks at the new PRIIPs filing requirements, which came into effect on 1 January 2023.

  • ID 1107 concerns the PRIIPs KID filing requirements of the Responsible Person of a UCITS seeking authorisation or approval of a new sub-fund which intends to produce a PRIIPs KID but not a UCITS KIID.
  • ID 1108 concerns the PRIIPs KID filing requirements of the Responsible Person of a UCITS seeking authorisation or approval of a new sub-fund which produces both a PRIIPs KID and a UCITS KIID.
  • ID 1109 concerns the PRIIPs KID filing requirements of the Responsible Person of an existing UCITS which produces a PRIIPs KID
    Further Central Bank guidance on PRIIPs filing requirements can be found here.

• Central Bank publishes the 46th Edition of the Central Bank AIFMD Q&A Document

  On 21 December 2022, the Central Bank also published the 46th edition of its Q&As on the AIFMD.

  The update revises the answer to ID 1126, which asks whether AIFs which are in scope of the PRIIPs Regulation must file KIDs with the Central Bank.

  The Central Bank’s response is that Retail Investor AIFs which produce PRIIPs KIDs must file these on an ex post basis – this includes periodic updates to existing KIDs.

  It also notes that the first annual reporting of such KIDs will be in January 2024.

ESMA publications

• ESMA provides guidance for supervision of cross-border activities of investment firms

  On 14 December 2022, ESMA published a MiFID II Supervisory Briefing, Supervision of cross-border activities of investment firms.

  Note that the contents of the Supervisory Briefing do not constitute new policy.

  In 2021, ESMA launched a peer review on National Competent Authorities’ (NCAs) supervision of cross-border activities of investment firms and published a report on its findings on 10 March 2022.

  The report identified the need for NCAs to significantly improve their approach to the authorisation, supervision and enforcement in relation to the cross-border activities of investment firms to retail clients, including calibrating their supervisory work to the nature, scale and complexity of those activities and the risks they pose.

  The new supervisory briefing provides NCAs with an accessible introduction to the supervision of cross-border activities to retail clients by investment firms in accordance with MiFID II, summarising key elements of the rules and including questions that NCAs are expected to ask when assessing their approach supervising investment firms’ cross-border activities to retail clients.

  This includes, among other things:

  • assessing, at the authorisation stage, whether the firm has cross-border plans and is fit to carry them out
  • regularly collecting minimum data on firms’ cross-border activities to retail clients (such as extent and complaints linked to cross-border activities)
  • ensuring, as part of the ongoing supervision, that specific cross-border risks are sufficiently captured in the general risk-based approach that the NCA takes.

• ESMA updates its Q&As on the application of the AIFMD

  On 16 December 2022, ESMA updated a number of its Q&A documents including that on the application of the AIFMD.

  The update consisted of a new Q&A within Section XI (Scope), dealing with the issue of whether or not managers of special purpose acquisition companies (SPACs) are subject to the AIFMD.

  The answer sets out a number of questions which should be address when deciding whether, on a case-by-case basis, the SPAC comes within the Directive’s definition of an AIF.

  For our summary of the update, please see here.