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I The CBDF Directive

The purpose of the Directive (EU) 2019/1160 of the European Parliament and the Council of 20 June 2019 (known as “Cross Border of Distribution of Funds Directive” or “CBDF”) – amending Directives 2009/65/EC (the “UCITS Directive) and 2011/61/EU (the “AIFMD”) is the simplification of the cross-border distribution of collective investment schemes, including UCITS and AIFs.
The deadline for its transposition into the national legislations of the Member States was 2 August 2021.

II The status of the implementation of the CBDF Directive in Italy

The implementation in Italy of the CBDF Directive isn’t still complete, although the relevant process started in April 2021.
In particular, the Level 1 Directives are implemented in Italy through Acts of the Government duly empowered for this purpose by the Parliament through a general delegation law called “EU Act”, approved every year, that contains the list of the Directives that the Government is delegated to implement.
With regard to the CBDF Directive, the 2020/2021 EU Act, or Law no. 53 of April 22, 2021 provides for a general delegation to the Government to issue rules for the full transposition of the provisions of that Directive, without any gold-plating. This will be done by the Government by amending the main piece of Italian financial law, i.e., the Consolidated Finance Act or “Testo Unico della Finanza” – Legislative Decree no. 58 of 1998, as amended (“TUF”). In this regard, the Government approved on July 15 2021 a draft (“Schema”) Legislative Act concerning the above modifications to the TUF, and this document is currently under scrutiny of the two houses of the Parliament in order to verify the consistency with the terms of the delegation granted by the above mentioned 2020/2021 EU Act. Final sign-off by the Parliament for the amendments to the TUF is expected by mid-November 2021
At its turn, the amended TUF will mandate CONSOB to issue the relevant second-level rules in 120 days. Therefore, the full transposition of the CBDF directive shall be achieved when the CONSOB Regulation on the Issuers of Financial Instruments (“RE”) – that includes the rules on marketing and marketing arrangements for foreign UCITS and AIFs – will be amended accordingly. For example, the RE currently requires that the local paying agent – i.e., the “facilities” mentioned in the new article 92 para 1 of the UCITS Directive as amended by CBDF – have to be established in Italy, and of course this provision will have to be amended.
It not possible to foresee when CONSOB will actually proceed to the relevant changes to the RE but it is reasonable to expect that such changes will not take place before end of 2021 due to the above mentioned timeframe. In addition, the Action Plan for Regulatory Actions of CONSOB for 2021 doesn’t mention changes to the RE in relation to the transposition of CBDF Directive.

III Interim measures

The fact that the CBDF Directive hasn’t been completely transposed in Italy as of August 2 may involve some issues in relation to the new paragraph 8 of article 93 of the UCITS Directive, that, inter alia, provides for the one-month prior notification of changes to the details given in the Notification letter under article 93 para. 1, or to the share classes which are marketed.
Since this notification has to be made to the regulators of both the UCITS home and host member State, CONSOB has, on an informal basis, provided a temporary e-mail address for this purpose, which is the same one used for the transmission of sales documents of UCITS funds marketed to professional investors. This e-mail address is UCITS-UPDATE@consob.it
We don’t expect inconveniences in connection with the delay in implementing the prohibition to require the physical presence in Italy of the above “facilities”, at least for the principle of the “vertical” (i.e., in the relationship between the public administration and the private entities) direct enforceability of a Directive after the deadline for its transposition. In addition, it reasonable to expect that the “facilities” for the paying agency and investors’ services for the Italian retail clients will unlikely be situated out of Italy due to the complexity of some parts of the relevant tasks, namely the administration of the withholding tax and the necessity of knowing the details of the underlying retail investors whereas the subscriptions of the funds are sent to the UCITS home member State on a nominee basis on the name of the local paying agent.


[1] IMPORTANT INFORMATION This memorandum is not given in performance of a professional engagement during an attorney-client relationship and is only given for a general information to the reader regarding the matters discussed herein.  Therefore, this document should not be relied upon as a legal opinion and no action should be taken on the basis of the information herein contained.  © 2021 Francesco Paolo Crocenzi