ESMA_QA_1134

Status: ✅ Answer Published

Link to ESMA Q&A tool: https://www.esma.europa.eu/publications-data/questions-answers/1134

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Regulatory Context

Regulation : UCITS

Level 1 Regulation: Undertakings for Collective Investment in Transferable Securities Directive (UCITS) Directive 2009/65/EC

Level 2 Regulation: No information available

Level 3 Regulation: No information available

Topic: Disclosures

Subject Matter: KIID Collateral management

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Question

Submission Date: 01 October 2016

Do the requirements on collateral only apply to the fraction of assets that reduces the counterparty risk of the UCITS to the limit imposed by the UCITS Directive?

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ESMA Answer

Answer Date: 01-10-2016

[ESMA 34-43-392 UCITS Q&A, section 3, Q&A 6a] No. The requirements on collateral apply to all the assets received in the context of OTC financial derivative transactions and efficient portfolio management (EPM) techniques to cover counterparty risk. This means that assets received in excess (i.e. after the application of haircuts) should also comply with the same requirements.

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This document was automatically extracted from the ESMA EMIR Q&A database.