ABBL

Management companies may carry out activities in other member states for which they have been authorised in their country of origin either through the free offer of services or by establishing a local branch.

Supervision of such activities will be provided by the regulatory authorities of the country of origin, which will send all required information to the relevant authorities in the host member state. The management company must therefore comply with the regulations of both countries.

This approach implies both a distinct procedure in each country as well as cooperation between the supervisory bodies through a point of contact as provided by the directive.

This is a process of optimising forces in order to exploit the advantages of different European financial markets and actors: at least two funds will be concerned > the "feeder", generally domiciled in the investor's country, will invest the majority of its assets (85 %) in the "master", which may be domiciled in another country.

These structures will allow considerable economies of scale and provide greater flexibility in the commercialisation of funds. 

The KII or KID will replace the simplified prospectus, considered to be incomprehensible and indigestible. The KII or KID will be short and non-technical while providing accurate, precise and comprehensible information.

This document will be limited to 2 pages, and will contain the following information:

- description of the investment policy,
- description of the objectives,
- historical performance data,
- costs and charges,
- risk profile and performance profile of the fund,
- place where the investor can find further information.

 Key Investor Information document: Questions and Answers

(September 2010)

This document was prepared by ALFI's implementation working group for the Key Investor Information document (KID). The working group comprises representatives of asset managers, management companies, securities service firms, audit firms, law firms, and document and information management firms.
This document contains the working group's answers to questions about KID implementation. The answers are not necessarily definitive and they might not be suitable for every circumstance. This document is not meant to be an industry standard or a guide to best practice but it represents the view from a group of market participants. The Q&A has not been validated by any regulator. It does not diminish the management company's or the investment company's responsibility to comply with the EU Regulation 583/2010 on the KID, CESR's related guidelines and technical advice papers and any other European or national law or regulation. This document must not be relied upon as advice and is provided without any warranty of any kind and neither ALFI nor its members who contributed to this document accept any liability whatsoever for any action taken in reliance upon it.

This document may be amended without prior notice to incorporate new material and to amend previously published material where the working group considers it appropriate. ALFI will publish amended copies of this document to its members, showing marked-up changes from the immediately preceding copy.
The titles used in this document are references to the relevant recitals, chapters, sections and articles of the EU Regulation 583/2010 and associated CESR guidelines and consultation papers.