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The European Securities and Markets Authority (“ESMA”) has published an opinion on the topic of UCITS share classes (the “Opinion”), confirming four high-level principles which a UCITS must follow when setting up different share classes and considering the manner in which certain share class hedging techniques comply with such principles.
The publication of the Opinion follows a consultation period launched by two separate discussion papers issued in December 2014 and April 2016 respectively, which saw ESMA’s analysis evolving from an examples-based approach (providing for non-exhaustive lists of permissible and prohibited differentiation at share class level) to a principles-based approach.
We have prepared a detailed briefing note providing further information on ESMA’s Opinion, including its implications for current share class hedging arrangements and the applicable transitional provisions.
ESMA’s Opinion may be accessed here.