Comment by Joy Dunbar
Last month the asset management industry came together to celebrate the launch of the first authorised UCITS-compliant fund.
The UCITS XXV thought leadership symposium, held in Brussels, was an opportunity for policy-makers, European and national regulators, service providers, the investment management industry and investors to discuss the past, present and future of the framework.
The event also discussed the role that Europe plays as a regional hub for international investment funds and the global asset management industry – as a quarter of UCITS investors are domiciled outside the EU.
Since the first UCITS-compliant fund launched 25 years ago in 1988, the framework has become one of the most successful investment structures in history.
Over the years the economic backdrop has changed dramatically and the industry is responding to various regulatory pressures.
But the watershed moment for the brand came with the introduction of UCITS III in 2001, which allowed the use of derivatives, indices and swap structures.
This resulted in the formation of the alternative UCITS industry. This has resulted in some in the industry arguing that some of the financial instruments currently allowed within the framework should be removed - while others argue that various new assets should be included under the umbrella.
Ultimately the point of the symposium was for the industry to discuss the best foundation for the future of the wrapper. The resulting white paper, which is expected to be published in the forthcoming weeks, will make recommendations and draw conclusions to shape the future UCITS agenda.
Many in the industry believe that a period of minimal – or even no – change is what UCITS needs most of all, in order to give some clarity and certainty after the instability and upheaval of the last few years.
But that looks unlikely. With UCITS VII already being discussed in some quarters, perhaps the only certainty that the wrapper has to offer is constant change.
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