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2016R0438_EN.10

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🔗 Back to Summary. 🇫🇷 French Version: 2016R0438_FR.10. Back to Summary of LVL1. Open the PDF. Direct link to EUR-LEX.

Article 9 – Cash monitoring — general requirements ⬅️ | ➡️ Article 11 – Duties regarding payments upon the subscriptions

Article 10 - Monitoring of the UCITS’ cash flows

1.

A depositary shall be deemed to comply with the requirements set out in Article 22(4) of Directive 2009/65/EC where it ensures effective and proper monitoring of the UCITS’ cash flows and, in particular, it at least:

(a)

ensures that all cash of the UCITS is booked in accounts opened with either a central bank or a credit institution authorised in accordance with Directive 2013/36/EU of the European Parliament and of the Council or a credit institution authorised in a third country, where cash accounts are required for the purposes of the UCITS’ operations, provided that the prudential supervisory and regulatory requirements applied to credit institutions in that third country are considered by the competent authority of the UCITS home Member State as at least equivalent to those applied in the Union;

(b)

implements effective and proper procedures to reconcile all cash flow movements and performs such reconciliations on a daily basis, or, in case of infrequent cash movements, when such cash flow movements occur;

(c)

implements appropriate procedures to identify at the close of each business day significant cash flows and cash flows which could be inconsistent with UCITS’ operations;

(d)

reviews periodically the adequacy of those procedures, including through a full review of the reconciliation process at least once a year, and ensures that the cash accounts opened in the name of the investment company or in the name of the management company acting on behalf of the UCITS or in the name of the depositary acting on behalf of the UCITS are included in the reconciliation process;

(e)

monitors on an ongoing basis the outcomes of the reconciliations and the actions taken as a result of any discrepancies identified by the reconciliation procedures, and notifies the management company or the investment company if a discrepancy has not been corrected without undue delay and also the competent authorities if the situation cannot be corrected;

(f)

checks that there is consistency between its own records of cash positions and those of the UCITS. For the purposes of assessing the equivalence of prudential supervisory and regulatory requirements applied to credit institutions of a third country referred to in point (a), competent authorities shall take into account the implementing acts adopted by the Commission pursuant to 2013 of the European Parliament and of the Council.

2.

The management company or the investment company shall ensure that all instructions and information related to a cash account opened with a third party are sent to the depositary, to enable the depositary to perform its own reconciliation procedure.

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