DENMARK: Danish FSA publish order on leadership, management and administration of Danish UCITS

Tuesday May 6 2014

The Danish Financial Services Authority, Finanstilsynet, has sent for consultation, a draft order on management and administration of Danish UCITS. The order is a modification of an existing order.

The modifications include the following;

• A new proportionality provision, whereby the Board of Directors and Executive can actively decide what and how much is needed to meet the requirements of the Order.
• The Order now states that mutual funds are managed by an investment management company as opposed to the current order, which is based on the premise that mutual funds are self-managed.
• The sections on the supervisory board`s duties have been clarified, including Management`s obligation to report to the Board on the asset location and the associated risk.
• The rules on risk management functions have been clarified in relation to the rules on risk of Directive 43 /2010.
• The rules now specify that compliance reporting need only reach the Board of Directors and the Investment Manager, unlike the current rules where compliance reporting also must be submitted to the Board of the Fund. The compliance officer shall also have the opportunity to speak directly to the board of the investment management company if the compliance controller deems it necessary. Moreover, the rule that the same person can be the Compliance and Risk Officer has been clarified so that this may happen if the Executive assesses the size and complexity justifies it.
• Finally, the order implements provisions of Directive 43/2010, concerning the processing of subscription and redemption orders, best execution and order handling.

The FSA has requested any comments to be submitted by Friday, 30th May 2014. Questions and comments can be submitted to msc@ftnet.dk or posted to Finanstilsynet, Arhusgade 110, 2100 Kobenhavn Ø, FAO: Martin Schultz.

Click on the above link for further details.