RegAlertGuidance · AMF
DOC-2011-10 Registration at the OPC Level of Loss or Gain Resulting from Settlement Failure After Issuance of a Subscription Order
The French Financial Markets Authority (AMF) clarifies that when a management company invests before receiving subscription funds, it assumes credit risk. In the event of a subscriber's default, the management company must divest, and the resulting gain or loss must be recorded at the level of the UCITS (OPCVM). This position is based on Articles 411-68 and 422-46 of the General Regulation.
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II - Investment Products
II. 1 - Collective Investments
II. 1.1. Provisions Common to UCITS and AIFs
Doctrine
Post-market
Registration at the OPC Level of Loss or Gain Resulting from Settlement Failure After Issuance of a Subscription Order
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Applicable from January 24, 2019
Position DOC-2011-10
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Summary
When a management company makes investments before receiving the funds corresponding to the subscription, it incurs credit risk. In the event of the subscriber's default, the management company must divest. Position DOC-2011-10 states that the gain or loss is recorded at the level of the OPC.
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Reference texts
Article 411-68 of the General Regulation
Article 422-46 of the General Regulation
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When a management company makes investments before receiving the funds corresponding to the subscription, it incurs credit risk. In the event of the subscriber's default, the management company must divest. Position DOC-2011-10 states that the gain or loss is recorded at the level of the OPC.
Download the doctrine
Reference texts
Article 411-68 of the General Regulation
Article 422-46 of the General Regulation
When a management company makes investments before receiving the funds corresponding to the subscription, it incurs credit risk. In the event of the subscriber's default, the management company must divest. The AMF indicates that the gain or loss is recorded at the level of the UCITS (OPCVM).
Download the doctrine
Reference texts
Article 411-68 of the General Regulation
Final report of the market committee - State of play and perspectives for the regulation of asset management on the occasion of the transposition of the UCITS IV directive Legal notices:
Publisher: The Director of the Communication Department of the AMF. Contact: Communication Department, Autorité des marchés financiers - 17, place de la Bourse - 75082 Paris Cedex 02
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