About a-team Marketing Services
The leading knowledge platform for the financial technology industry
The leading knowledge platform for the financial technology industry

A-Team Insight Blogs

ESMA Provides FAQ on Common Definitions for European Money Market Funds Under UCITS

Subscribe to our newsletter

As part of the revised Undertakings for Collective Investment in Transferable Securities (UCITS) Directive in Europe, the European Securities and Markets Authority (ESMA) has published a Q&A document that details its guidelines for regulators regarding common definitions for the supervision of money market funds. The paper is aimed at getting European regulators in synch with regards to the treatment of these instruments across the region and to this end, includes information about the expected treatment of ratings (internal and external), details of semantics related to these funds and ESMA’s expectations for firms’ treatment of these instruments.

As stated by ESMA in the document: “The Q&A mechanism is a practical convergence tool used to promote common supervisory approaches and practices under Article 29(2) of the ESMA Regulation.” As such, it is a living document and any further questions or requests for clarification can be added by emailing moneymarketfunds@esma.europa.eu.

The Q&A currently highlights items such as ESMA’s expectations in terms of a management company’s internal rating process; the treatment of instruments with only long term ratings and those that have not been rated; and the definition of what constitutes a “recognised credit rating agency,” among other things. It also provides technical details with regards to the calculation of various aspects of money market funds’ structures, such as the weighted average maturity of the fund or its weighted average life.

ESMA has spent a large part of this year delving into the data related details of various pieces of legislation and, with regards to UCITS, it is an extension of the work carried out by its predecessor last year. The European level regulator has also spent a considerable amount of time, along with the rest of the global regulatory community, consulting on the subject of credit ratings agency as part of the crackdown on the sector.

Subscribe to our newsletter

Related content

WEBINAR

Recorded Webinar: How to optimise the business value of your data using agile data governance

Data governance is transforming from a risk management and compliance tool with limited and prescriptive controls, to a solution that can help you optimise the business value of your data. In this role, data governance must scale to manage rising volumes of data, more and different data types, and changing user requirements, while continuing to...

BLOG

Regulatory Oversight Committee of the LEI Revises Policy on Level 2 Data Reporting

The Regulatory Oversight Committee (ROC) of the Global LEI System (GLEIS) has revised two elements of policy covering the reporting of LEI parent relationship data, also known as Level 2 data. To improve the usability of Level 2 data, the ROC has revised the list of opt-out reasons that can be used by an entity...

EVENT

Data Management Summit London

Now in its 13th year, the Data Management Summit (DMS) in London brings together the European capital markets enterprise data management community, to explore the evolution of data strategy and how to leverage data to drive compliance and business insight.

GUIDE

ESG Data Handbook 2022

The ESG landscape is changing faster than anyone could have imagined even five years ago. With tens of trillions of dollars expected to have been committed to sustainable assets by the end of the decade, it’s never been more important for financial institutions of all sizes to stay abreast of changes in the ESG data...