Guide on Social Media Published by the AFG

The AFG (Association Française de Gestion), the association representing French management companies, published a guide setting out a framework for the use of social media by management companies. For instance, the guide provides that management companies should (i) implement specific measures such as an ongoing watch, (ii) hold training sessions for their staff and (iii) draft a good conduct guide.

Read the AFG’s “Guide on the use of the social media”.

Update of the AMF Doctrine on French Professional Specialized Funds

The AMF updated its Instruction n° 2012-06 specifying the rules to be followed (i) for the drafting of the prospectus of a French Professional Specialized Fund and (ii) for its declaration to the AMF. The update mainly grants more flexibility to managers in the drafting of such funds’ prospectus and provides additional information which must be communicated to investors.

Read the updated AMF Instruction n° 2012-06 (in French).

Fees Paid in France by Foreign Management Companies

The Decree n° 2015-421 dated 14 April 2015 provided the amount of fees due to the AMF by foreign management companies. Among others (i) a € 2,000 fee per fund or sub-fund shall be paid to the AMF for the registration in France of foreign AIFs; and (ii) a 0.008 per thousandth fee shall be levied on the net assets under management for French AIFs managed by foreign management companies. The rate of such fee will be raised to 0.01 per thousandth on 1 January 2016.

Read the Decree n° 2015-421 dated 14 April 2015 (in French).

AFG Replies to ESMA’s Call for Evidence on Competition, Choice and Conflicts of Interest in the Credit Rating Industry

The AFG replied to the call for evidence on 27 March 2015, regarding the credit rating industry published by ESMA on February 3rd 2015. The answer pointed out the main concerns of French management companies which mainly concerned (i) requirements for due diligence and use of credit ratings, (ii) independence and quality of credit ratings, (iii) specific disclosure requirements for structured finance instruments and (iv) mandatory rotations and competition between credit rating agencies (CRAs). The AFG recommended for the ESMA not to implement the CRAs Regulation in a manner which would incur additional costs for the management companies.

Read the AFG’s answer to ESMA’s consultation paper.

AFG Replies to ESMA’s Discussion Paper on Share Classes of UCITS

The AFG replied on 27 March 2015 to the discussion paper on share classes of UCITS published by ESMA. In particular, the AFG recommended ESMA to provide management companies with a standardized definition of “investment strategy” as it would help to define the concept of classes of shares. Furthermore, the AFG recalls that curbing the share classes possibilities beyond reasonable boundaries would be detrimental to both the asset management industry and international investors. The answer can be found on the AFG’s website.

Read the AFG’s answer to ESMA’s discussion paper.

Settlement by a French Management Company with the AMF

The AMF published a settlement entered into with a French management company on 2 April 2015. The management company agreed to pay a € 40,000 fine for the infringement of its obligations to (i) ensure orders traceability, (ii) control UCITS’ investment ratios and (iii) set out ongoing and efficient procedures for compliance and internal control.

Read the AMF transaction n° 2015-04 (in French).