BAKGRUNN (fra kommisjonsforordningen)

(1) Under Article 9(2), point (d), of Regulation (EU) 2015/760, European long-term investment funds (ELTIFs) are prohibited from using financial derivative instruments, except where the use of such instruments solely serves the purpose of hedging the risks inherent to other investments of the ELTIF. The financial derivative instruments that should be considered to solely serve the purpose of hedging the risks inherent to other investments of the ELTIF are those the underlyings of which correspond to the assets to which an ELTIF has or would have exposures. In some cases, however, there may be no financial derivative instruments available to hedge an exposure to a specific asset. In that case, it should be possible to hedge that exposure by using a financial derivative instrument the underlyings of which belong to the same, or economically similar, asset class as the financial derivative instrument the underlyings of which correspond to the assets to which an ELTIF has or would have exposures. To ensure that the use of financial derivative instruments solely serves the purpose of hedging the risks inherent to other investments of an ELTIF, the financial derivative instruments used should effectively reduce the risk concerned. The reduction of risk should therefore be verifiable through systems that identify the risks to be mitigated and the way in which the financial derivative would mitigate such risk. 

(2) The underlyings and their liquidity profile can have an impact on the ELTIF and the long-term nature of the ELTIF. It is necessary to ensure the alignment and coherence of an ELTIF’s investment strategy with its liquidity profile and redemption policy of the ELTIF. The manager of an ELTIF should therefore, when assessing whether the life of an ELTIF is compatible with the life-cycles of each of the individual assets of the ELTIF, as referred to in Article 18(3) of Regulation (EU) 2015/760, consider the liquidity profile of each of the ELTIF’s individual assets, the liquidity profile of the ELTIF’s portfolio on a weighted basis, the timing of acquisition of those individual assets, and the valuation of those individual assets. Since redemptions may affect the assets and liabilities and the liquidity of an ELTIF, the manager of an ELTIF that provides for the possibility of redemptions during the life of the ELTIF should also consider the redemption policy of that ELTIF when assessing whether the life of an ELTIF is compatible with the life-cycles of each of the individual assets of the ELTIF. 

(3) Under Article 18(2), first subparagraph, point (b), of Regulation (EU) 2015/760, the manager of the ELTIF is to be able to demonstrate to the competent authority of the ELTIF that the ELTIF has in place an appropriate redemption policy and liquidity management tools that are compatible with the long-term investment strategy of the ELTIF. One way of achieving that objective is by analysing the results, assumptions and inputs used for liquidity stress tests when those are carried out in accordance with Article 15(3), point (b), or Article 16(1) of Directive 2011/61/EU of the European Parliament and of the Council. The results of that analysis should enable managers of ELTIFs to demonstrate whether and how, in severe but plausible scenarios, the ELTIF is able to deal with redemption requests. Those results should also enable the competent authorities to assess those scenarios for the assets and liabilities, including redemption and collateral shocks, and the decrease in the value of the assets in those stress scenarios. 

(4) The minimum holding period, if any, referred to in Article 18(2), first subparagraph, point (a), of Regulation (EU) 2015/760 typically can enable the ELTIF to complete the investment of its capital contributions. It follows that the minimum holding period, if any, should allow the ELTIF to achieve that aim. However, Regulation (EU) 2015/760 does not specify the length of the minimum holding periods, nor the requirement thereof, and requires that the manager of an ELTIF determines the minimum holding period based on a set of certain criteria. Therefore, in determining that minimum holding period, the manager of the ELTIF should consider the circumstances of the ELTIF. 

(5) With respect to ELTIFs that provide for the possibility of redemptions during their life in accordance with Article 18(2) of Regulation 2015/760, in the interest of legal certainty of ELTIFs and their investors it should be noted that in some Member States, the redemption policy is not always included in the articles of incorporation. That is because in some Member States the articles of incorporation typically specify the purpose of the company or the fund, its registered office, its general meetings, the powers of the board of directors and other details pertaining to the setup of the ELTIF, but not the policies or procedures implemented by a third party, including the alternative investment fund manager (AIFM) managing the fund. In the interest of transparency and investor protection, the manager of an ELTIF should provide the competent authority of the ELTIF with certain minimum information that demonstrate that the ELTIF has in place an appropriate redemption policy and liquidity management tools that are compatible with the long-term investment strategy of the ELTIF. 

(6) Article 16(1) of Directive 2011/61/EU requires AIFMs, and thus also managers of ELTIFs, to employ an appropriate liquidity management system, to adopt procedures which enable them to monitor their liquidity risk, and to ensure the alignment of the investment strategy, liquidity profile and redemption policy of the ELTIF. In that regard, the manager of an ELTIF should have the possibility to select and implement, at its discretion, one or more anti-dilution liquidity management tools or other liquidity management tools. Since ELTIFs can be marketed to retail investors and to enable a high standard of market integrity, in the latter case, the manager of the ELTIF should provide the competent authority of the ELTIF, upon request of that authority, with the information on the choice of the liquidity management tools and their appropriateness in the context of the ELTIF. 

(7) ELTIFs should be able to implement investment strategies in long-term assets, which requires that the maximum liquidity to be offered in an ELTIF can be determined and that the probability of suspension of an ELTIF is reduced. For that reason, the manager of an ELTIF should implement the redemption restriction laid down in Article 18(2), first subparagraph, point (d), of Regulation (EU) 2015/760 in such a way that it is ensured that redemptions are limited to a portion of liquid assets and that liquidity mismatches are avoided. To ensure the effective protection of the long-term assets of the ELTIF and the resulting protection of the interests of all investors, the use of redemption restrictions should relate to a wide range and different types of situations, including to stressed market situations. 

(8) When assessing the percentage referred to in Article 18(2), first subparagraph, point (d), of Regulation (EU) 2015/760, competent authorities should take into account, inter alia, the variety of ELTIFs, their liquidity profile, the notice period, if any, and the frequency of redemptions of the ELTIF and expected cash flows in a conservative manner. Competent authorities should therefore only take expected positive cash flows into account to the extent that there is a high degree of certainty that those positive cash flows will materialise. It follows that competent authorities should not consider as expected positive cash flows the possibility that the ELTIF can dispose of eligible long-term investment assets or the possibility that the ELTIF can raise capital through new subscriptions. 

(9) The manager of the ELTIF should determine the percentage referred to in Article 18(2), first subparagraph, point (d), of Regulation (EU) 2015/760 either on the basis of the redemption frequency and the maximum length of the notice period, which represents the notice period, including the extension of the notice period, if any, or, alternatively, on the basis of the redemption frequency and the minimum percentage of liquid assets. In both cases, the manager of the ELTIF may consider introducing a notice period as part of the redemption policy. To facilitate the calibration of the liquidity parameters by the manager of the ELTIF and the effective supervision by the competent authority, the linear approximation should be used to determine the maximum percentage of assets referred to Article 18(2), first subparagraph, point (d), of Regulation (EU) 2015/760 where the redemption frequency or the notice period do not correspond to the parameters set out in the calibration tables provided to the manager of the ELTIF. 

(10) Where the amount of liquid assets of the ELTIF falls below certain specified thresholds, in particular, given asset value fluctuations or the impact of redemptions, the manager of the ELTIF should, within an appropriate period of time, take such measures as are necessary to reconstitute the minimum percentage of the liquid assets, taking due account of the interests of the investors in the ELTIF and the long-term investment strategy of the ELTIF. 

(11) To ensure the liquidity in and transferability of units or shares of ELTIFs, the possibility to match transfer requests, as referred to in Article 19(2a) of Regulation (EU) 2015/760, should not be deemed to prohibit other forms of secondary transfers, provided that the policy for matching requests of the ELTIF does not prohibit such transfers and provided that such possibility is explicitly agreed between the transferring investors. 

(12) In relation to the possibility to match transfer requests, as referred to in Article 19(2a) of Regulation (EU) 2015/760, that for the purposes of this Regulation should not be considered a multilateral system, and in relation to the possibility of redemptions during the life of the ELTIF referred to in Article 18(2) of Regulation (EU) 2015/760, it is necessary to specify certain requirements pertaining to the functioning of the matching of transfer requests. 

(13) To reduce the likelihood of price arbitrage between the net asset value of the units or shares of ELTIFs traded on a secondary market and those matched through the matching of transfer requests, where the execution price is not based on the net asset value of the ELTIF, the execution price should be determined outside the valuation dates of the ELTIF. 

(14) Pursuant to Article 19(2a), point (b), of Regulation (EU) 2015/760, where there is a mismatch between exiting and potential investors, matching is to be carried out on a pro rata basis. To ensure the effective functioning of the matching of requests and the confidence of investors therein, investors should be offered the opportunity to restate their orders, leave their residual matching requests in place in anticipation of future matching, or withdraw their residual or outstanding matching interest. 

(15) In some Member States, the rules or instruments of incorporation typically determine the purpose of the company or the fund, its registered office, its general meetings, the powers of the board of directors and other details pertaining to the setup of the legal entity, but not the policies or procedures implemented by a third party, such as the AIFM managing the fund. Furthermore, inserting all those details in the rules or instruments of incorporation of an ELTIF in certain cases would not be possible, in particular in the case of umbrella funds with various diverging sub-funds. 

(16) Irrespective of how the ELTIF provides for the possibility of full or partial matching of requests, in the interest of a high level of investor protection, the policy for matching requests put in place by the manager of an ELTIF should contain certain information pertaining to the format, procedures, conditions and the timing of the matching. 

(17) It is necessary to ensure a high level of information on the potential market and its participants that could represent potential buyers of the disposed assets of the ELTIF, which can be illiquid and idiosyncratic. The assessment of the market for potential buyers referred to in Article 21(2), point (a), of Regulation (EU) 2015/760, should therefore take into account market risks, and thus assess, inter alia, whether potential buyers are dependent on obtaining loans from third parties, whether there is a risk of illiquidity of the assets before sale, whether there are risks associated with political changes or legislative changes, including fiscal reforms, and whether there is a risk of deterioration of the economic situation in the market which is relevant to the ELTIF assets (18) Market events can materially change the valuation of the assets of the ELTIF and thus affect the interests of investors. The valuation of the assets to be divested referred to in Article 21(2), point (c), of Regulation (EU) 2015/760 should therefore be carried out at a point in time that is sufficiently close to the beginning of the disposal of the assets. To avoid undue burdens for the ELTIF and to ensure a cost-effective functioning of the ELTIF, which benefits all investors in an ELTIF, an ELTIF that has already valued those assets in accordance with Directive 2011/61/EU at a moment in time that is sufficiently close to the beginning of the disposal of those assets should not be required to revalue those assets. 

(19) To ensure a common approach in relation to the disclosure of the costs of investing into an ELTIF, such disclosure of costs should encompass all costs borne directly or indirectly by investors. It is necessary to specify that the distribution costs should comprise all administrative, regulatory, professional service, and audit costs that are related to distribution, and to provide for common definitions, calculation methodologies and presentation formats of those costs. 

(20) Pursuant to Article 2, fourth subparagraph, of Regulation (EU) 2023/606 of the European Parliament and of the Council, ELTIFs authorised before 10 January 2024 may choose to be subject to that Regulation. Accordingly, ELTIFs that do not choose to be subject to Regulation (EU) 2023/606 should remain subject to Commission Delegated Regulation (EU) 2018/480. 

(21) This Regulation is based on the draft regulatory technical standards submitted to the Commission by the European Securities and Markets Authority. 

(22) The European Securities and Markets Authority has conducted open public consultations on the draft regulatory technical standards on which this Regulation is based, analysed the potential related costs and benefits and requested the advice of the Securities and Markets Stakeholder Group established by Article 37 of Regulation (EU) No 1095/2010 of the European Parliament and of the Council,