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Central Bank of Ireland: Capital Markets Update, March 2019


Central Bank of Ireland Markets Update

The Central Bank of Ireland has issued the third markets update of 2019 on 7th March this year. The main points are below:

  • The 32nd edition of the Central Bank AIFMD Q&A has been published and clarifies that QIAIFs with UK AIFMS  (after Brexit these will become non-EU AIFMs) will become subject to the AIFMD depositary regime including the AIFMD depositary liability provisions.
  • An updated CBI Brexit FAQ (March 6th, 2019) clarified that the Multilateral Memoranda of Understanding, agreed between European securities regulators and the FCA in February, facilitates delegation or outsourcing arrangements between Irish UCITS Management Companies/AIFMs/MiFID Firms and UK entities.
  • In a notice of intention (March 7th, 2019), the CBI states that in the event of a no-deal Brexit after 30 March, UK UCITS will become UK AIFs (due to the UK becoming a 3rd country). The Central Bank will then consider if these funds fall under the category of investment fund in which UCITS and retail Investor AIFs may invest.  Under the regulation of Irish UCITS, any investment in UK AIFs must fall within the aggregate limit of 30% for investments in all AIFs. Under a no-deal Brexit the Central Bank will also consider if UK investment firms authorised under MiFID should be a category of eligible financial derivative counterparty for UCITS and retail Investors AIFs. Since there is currently no clear course on Brexit, these circumstances may change quickly.
  • CBI has written to counterparties asking for feedback on the main issues observed in the EMIR data quality work carried out by the Central Bank in 2018 (February 20th, 2019). Failure to report details of a derivative contract to a trade repository following the conclusion, modification or termination of the contract by the end of the working day is a regulation violation.
  • The Central Bank has also issued the seventh edition of the Central Bank Investment Firms Q&A  (March 7th, 2019) which states that only EEA MiFID firms can appoint tied agents and that tied agents must be persons who are established in the EEA.

With Brexit on the horizon, no doubt there will continued communications over the coming weeks. Subscribe to the AQMetrics mailing list here to keep up to date with all the new details.