ESMA · ESMA_QA_1160 Answer Published

KIID Collateral management

Regulation
Undertakings for Collective Investment in Transferable Securities Directive (UCITS) Directive 2009/65/EC
Topic
Depositaries
Submitted
2016-10-01
Answered
2016-10-01
Browse UCITS Register → More Q&As on this regulation →

Question

According to paragraph 43(g), where there is title transfer, the collateral received should be held by the depositary of the UCITS. Where there is title transfer and where the provider is also the depositary of the UCITS, should the collateral be held by the depositary of the UCITS?

Answer

[ESMA 34-43-392 UCITS Q&A, section 3, Q&A 6L] Yes. However, the depositary should have functionally and hierarchically separated the performance of its depositary tasks from its activity of collateral provider vis-à-vis the UCITS in order to address potential conflicts of interest.
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This Q&A is published by European Securities and Markets Authority and is non-binding. It does not constitute legal advice. Updated weekly from official ESA sources.

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