Service Investment Services 88% Fixed Income 75%
Specialism Liquidity 89% Prudential Standards 87%
2026-03-13 08:50:04 · adavies@vixio.com
ID
2961360
GUID
f3b96949caec32e40f6443c59c6dce5b

Classification

Service
Investment Services (88%)

The update establishes regulatory guidelines for liquidity management in collective investment undertakings (UCITS) and alternative investment funds, which are investment vehicles managed by non-depository institutions offering asset management services to investors.

Fixed Income (75%)

Fixed Income is a secondary consideration because liquidity management tools (redemption gates, swing pricing, anti-dilution levies) are commonly applied to bond-heavy and fixed income-focused funds, though the guidelines apply broadly across fund types.

Specialism
Liquidity (89%)

The update establishes mandatory guidelines for fund managers on liquidity risk management tools and calibration requirements under EU directives, which directly addresses prudential liquidity standards for collective investment undertakings.

Prudential Standards (87%)

Mandatory inheritance: Liquidity is a child of Prudential Standards, so Prudential Standards must be raised as the secondary tag.

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TITLE: European Securities and Markets Authority Issues Guidelines on Liquidity Management Tools for Collective Investment Undertakings and Alternative Investment Funds BODY: On 12 March 2026, the European Securities and Markets Authority (ESMA) published general guidelines on the selection and calibration of liquidity management tools for undertakings for collective investment in transferable securities (UCITS) and open-ended alternative investment funds (AIFs). These guidelines implement mandates established under European Parliament and Council Directive (EU) 2024/927, which amended the UCITS Directive (2009/65/ES) and the Alternative Investment Fund Managers Directive (2011/61/EU). The guidelines establish principles for fund managers and competent authorities regarding the selection, activation, and calibration of liquidity management tools to effectively manage liquidity risk and mitigate financial stability risks. Fund managers retain primary responsibility for liquidity risk management and must select appropriate tools from two categories: quantitative criteria-based tools (redemption gates, notice period extensions, and in-kind redemptions) and anti-dilution tools (redemption fees, swing pricing, dual pricing, and anti-dilution levies). ESMA requires fund managers to select at least two suitable tools, considering factors including fund legal structure, investment strategy, trading conditions, liquidity profile, stress test results, investor base characteristics, and operational constraints. The guidelines emphasise that fund managers should consider selecting one tool for normal market conditions and another for stressed conditions. Suspension of subscriptions, redemptions, and redemptions should be activated only in extraordinary circumstances. Fund managers must calibrate anti-dilution tools to reflect estimated liquidity costs and regularly review calibrations to ensure effectiveness. Competent authorities must notify ESMA within two months of publication whether they comply with these guidelines or provide reasons for non-compliance. The guidelines apply from the effective date of the implementing regulatory technical standards, with existing funds having a 12-month transition period.
  • Scraped:2026-03-13 08:50:04
  • Created:2026-03-13 08:50:04
  • By:adavies@vixio.com (41)