Global Trustee and Fiduciary Services Bite-Sized Issue 1 2024

Global Trustee and Fiduciary Services Bite-Sized | Issue 1 | 2024 5 QUICK LINKS BENCHMARKS REGULATION CSDR CYBERSECURITY DEFI DIGITALISATION DORA ELTIF FSB FUND LIQUIDITY MONEYMARKET FUNDS OPERATIONAL RESILIENCE SUSTAINABLE FINANCE/ESG ASIA EUROPE IRELAND NORTH AMERICA UNITED KINGDOM • Guidelines on aggregated costs and losses frommajor ICT-related incidents; • RTS on threat-led penetration testing; • RTS on subcontracting of critical or important functions. • Guidelines on oversight cooperation between the ESAs and competent authorities; and • RTS on oversight harmonisation. Responses are requested by 4 March 2024. The ESAs will hold an online public hearing on 23 January 2024 to discuss and explain the consultations. The legal instruments are expected to be finalised by 17 July 2024. Link to Consultation Overview here ELTIF ESMA Finalises Technical Standards under the Revised ELTIF Regulation On 19 December 2023 the European Securities and Markets Authority (ESMA) published its final report, setting out the draft Regulatory Technical Standards (RTS) for the European Long-Term Investment Fund (ELTIF) regulation. The draft regulatory technical standards (RTS) cover: • The circumstances in which the life of a ELTIF is considered compatible with the life cycles of each of the individual assets, as well as different features of the redemption policy of the ELTIF; • The circumstances for the use of the matching mechanism, i.e., the possibility of full or partial matching (before the end of the life of the ELTIF) of transfer requests of units or shares of the ELTIF by exiting ELTIF investors with transfer requests by potential investors; and • The costs disclosure. ESMA says that the RTS final report delineates the specific rules that are to be applied providing a detailed framework for aspects such as minimum holding period and maximum redemption frequency, choice of liquidity management tools, notice period and maximum percentage of liquid assets that can be redeemed. Minimum holding period: ESMA suggest allowing the ELTIF manager to select the minimum holding period that is best adjusted to an individual ELTIF, based on criteria set in the RTS, and upon justifications to the competent authority. Maximum redemption frequency: ESMA proposes to include a common standard (maximum quarterly redemption frequency), while allowing the ELTIF manager to deviate from it, upon justifications to the competent authority. Choice of liquidity management tools: It is suggested the mandatory implementation of at least one anti-dilution mechanism (in addition to notice period), and redemption gates, while allowing the ELTIF manager to deviate from it, in specific circumstances, and upon justifications to the competent authority. Notice period and maximum percentage of liquid assets that can be redeemed: In addition to applying minimum percentages of liquid assets, depending on the length of the notice period, different percentages of maximum amount of liquid assets that can be redeemed are also applied. The final RTS seeks to reach a balance by proposing prescriptive rules, while allowing ELTIF managers to deviate from these under specific circumstances.