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Improved framework for UCITS funds
UCITS funds account for over €6.4 trillion of assets (equivalent to half of the Union's GDP) and represents 11.5% of European household financial assets.
The aims of the new provisions are:
- allow cross-border activities, consolidation in the industry and associated economies of scale (currently EU funds are on average 5 times smaller than US funds and the cost of managing them are twice as high as in the US);
- offer investors greater choice and lower costs;
- improve investor protection by ensuring firms provide clear and relevant information when investing in UCITS. These improvements will help reinforcing the competitiveness of UCITS on global markets. Currently 40 % of UCITS originating in the EU are sold in third countries, mainly Asia, the Gulf region and Latin America. As part of the Commission's Better Regulation Strategy and its firm commitment to simplify the regulatory environment, the new Directive will replace 10 existing directives with a single text. The proposal now passes to the European Parliament and Council for consideration.
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