The Central Bank published Consultation Paper 134 “Central Bank performance fee guidance for UCITS and certain types of retail AIFs" on 3 December 2020.
The consultation seeks stakeholder’s views on the incorporation of ESMA’s “Guidelines on performance fees in UCITS and certain types of AIFs” into the Irish regulatory framework. The ESMA Guidelines apply from 5 January 2021.
The CBI consultation closes on 15 January 2021.
The CBI already has performance fee requirements under the CBI UCITS Regulations, some of which have an implementation date of 27 November 2020, and the AIF Rulebook in respect of retail AIFs. Consequently implementation of the ESMA Guidelines will have certain complexities and for a period of time the existing performance fee requirements as well as the performance fee regime established under the ESMA Guidelines will run in parallel. For the avoidance of doubt, in the event of any inconsistency between the ESMA Guidelines and the CBI UCITS Regulations or the AIF Rulebook, the statutory obligations of the CBI UCITS Regulations and the AIF Rulebook will prevail.
The Central Bank is proposing a phased implementation of the ESMA Guidelines over time due to the need to consult on amending the domestic framework to incorporate the ESMA Guidelines, to reflect the transitional periods provided for under the ESMA Guidelines and to maintain a consistent approach for retail investor funds.
In order to incorporate the ESMA Guidelines into the Central Bank’s regulatory framework it is proposed to issue specific Central Bank Performance Fee Guidance.
