United States:
ESMA Guidelines On Marketing Communications For Funds Will Start To Apply
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On 2 February 2022, the new ESMA guidelines on marketing communications under
the Regulation on cross-border distribution of funds (EU)
2019/1156) (“Guidelines“) will start to
apply.
The Guidelines set the requirements for marketing communications
that promote UCITS and alternative investment funds (AIFs), such as
European social entrepreneurship funds (EuSEFs), European venture
capital funds (EuVECAs), and European long-term investment funds
(ELTIFs).
The Guidelines apply to alternative investment funds managers
(“AIFMs”) based in the EEA. Non-EEA AIFMs are only
subject to the requirements if they are carrying out marketing in
certain EEA member states.
What is Marketing Communication?
The Guidelines apply to all communications that are made for the
purpose of “marketing” as defined under AIFMD. The
communications covered include websites, social media posts, live
presentations – the Guidelines do not apply to legal documents,
such as PPM and constitutional documents. Any information provided
to investors in the context of pre-marketing (i.e. the preliminary
promotional communications made before an AIFMD fund marketing
approval is received for a particular fund) is also not considered
as marketing communications.
What are the Requirements?
The Guidelines set out that marketing communication must:
- Be identifiable as marketing material,
- Describe the risks and rewards of purchasing units or shares of
an AIF, or units of a UCITS, in an equally prominent manner,
and - Contain information that is fair, clear and not
misleading.
As an example, materials provided during the AIFMD
“marketing” phase which are not legal or regulatory
documents should include a short disclaimer stating that it is a
marketing communication and the Guidelines provide an example
template disclaimer.
Next Steps
AIFMs in the scope of the new Guidelines should review which
fund marketing communications and take appropriate steps to comply
with the recommendations and provisions set out in the
Guidelines.
ESMA Guidelines On Marketing Communications For
Funds Will Start To Apply
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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