On 03rd December 2020, the Central Bank published Consultation Paper 134 on new Central Bank performance fee guidance for UCITS and certain types of retail AIFs. 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.

Performance Fee Guidance

  • This Guidance incorporates, to the extent currently possible and practicable, ESMA Guidelines on performance fees into the Central Bank’s supervisory framework for both UCITS and retail AIF .
  • The Guidance is in addition to the existing legislative requirements for UCITS or conditions for AIFs. For the avoidance of doubt, in the event of any inconsistency between the Guidance and the CBI UCITS Regulations or the AIF Rulebook, the statutory obligations of the CBI UCITS Regulations and the AIF Rulebook will prevail.
  • The Guidance is applicable to UCITS and retail AIFs authorised and supervised by the Central Bank.
  • The Guidance is effective as follows for:
    1. new UCITS or retail AIFs established: Guidance will apply from the date of establishment of those funds.
    2. existing UCITS and retail AIFs which amend an existing performance fee or introduce a new performance fee: Guidance will apply from the date of amendment or introduction of the performance fee.
    3. UCITS and retail AIFs with existing performance fees prior to the 5 January 2021: Guidance will apply from the beginning of the accounting period, which occurs six months after 5 January 2021 (i.e. the next accounting period after 5 July 2021).