Brussels, 27/07/2012 (Agence Europe) - The European Commission has opened a consultation process that will run until Thursday 18 October 2012 on unregulated activities by investment funds covered by the EU UCITS (Undertakings for Collective Investment in Transferable Securities) Directive. It is seeking the opinion of interested parties on potential dangers to financial stability generated by certain shadow banking techniques (lending securities and pensioning off) used by monetary funds and others. The consultation is based on guidelines laid down by the European Securities Management Authority (ESMA) for quoted unit trusts and will supplement the work currently underway to shed light on shadow (unregulated) banking, which accounts for more than a quarter of the world's financial system (see EUROPE10577).
The consultation will also examine exposure of UCITS investment trusts to over-the-counter derivatives which in the future will have to be cleared centrally. Further issues to be covered include the longer-term political challenge of giving retail investors strategic vision and access to investments that suit their needs, explains the Commission in a press release. See:
http://ec.europa.eu/internal_market/consultations/2012/ucits_en.htm (MB/transl.fl)