•  
• Tweet
•  
•        Print
•  
•         Track Keywords
•  
• 

By: Michael G. Tannenbaum

Undertakings for Collective Investments in Transferable Securities (UCITS) have become increasingly popular as an attractive cross-border investment fund product. UCITS funds are readily sold in the European Union under its harmonized regulatory regime, allowing member nations to passport the product — i.e. a UCITS fund based in one member state can be sold in another member state without any further authorization by the host country. As UCITS funds’ popularity has grown in Europe, they have also attracted investors outside of the European Union. Qualifying U.S. investors can take advantage of the investment opportunities presented by UCITS funds. This article provides a brief overview of the regulatory requirements that UCITS funds must follow when marketing to U.S. investors.

U.S. private placement rules apply

In short, UCITS brought to market in the U.S. must meet the U.S. private placement rules. These rules are self-executing and well defined. In order for a UCITS to make an offering to a U.S. Person without registering with the Securities and Exchange Commission, it must comply with the eligibility requirements set forth under Regulation D of the Securities Act of 1933 (the "Securities Act") as well as Sections 3(c)(1) or 3(c)(7) of the Investment Company Act of 1940 (the "Company Act"). Under Regulation D, interests in the fund can be offered either:

i. through the traditional private placement concepts (Rule 506(b)), up ......................

To view our full article Click here