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Regulation (EU) 2017/1131 of the European Parliament and of the Council of 14 June 2017 on money market funds (Text with EEA relevance. )

Type Regulation
Publication 2017-06-30
Last updated 2024-12-24
State In force
Department Council of the European Union, European Parliament
Source EUR-Lex
articles 48
Reform history JSON API
  • (a) whenever the proportion of weekly maturing assets as set out in point (e) of Article 24(1) falls below 30 % of the total assets of the public debt CNAV MMF or of the LVNAV MMF and the net daily redemptions on a single working day exceed 10 % of total assets, the manager of the public debt CNAV MMF or of the LVNAV MMF shall immediately inform its board thereof and the board shall undertake a documented assessment of the situation to determine the appropriate course of action having regard to the interests of the investors and shall decide whether to apply one or more of the following measures:
  • (i) liquidity fees on redemptions that adequately reflect the cost to the MMF of achieving liquidity and ensure that investors who remain in the fund are not unfairly disadvantaged when other investors redeem their units or shares during the period;
  • (ii) redemption gates that limit the amount of shares or units to be redeemed on any one working day to a maximum of 10 % of the shares or units in the MMF for any period up to 15 working days;
  • (iii) suspension of redemptions for any period up to 15 working days; or
  • (iv) take no immediate action other than fulfilling the obligation laid down in Article 24(2);
  • (b) whenever the proportion of weekly maturing assets as set out in point (e) of Article 24(1) falls below 10 % of its total assets, the manager of a public debt CNAV MMF or of a LVNAV MMF shall immediately inform its board thereof and the board shall undertake a documented assessment of the situation and, on the basis of such assessment and having regard to the interests of the investors, shall apply one or more of the following measures and document the reasons for its choice:
  • (i) liquidity fees on redemptions that adequately reflect the cost to the MMF of achieving liquidity and ensure that investors who remain in the fund are not unfairly disadvantaged when other investors redeem their units or shares during the period;
  • (ii) a suspension of redemptions for a period of up to 15 working days.
2.

When, within a period of 90 days, the total duration of the suspensions exceeds 15 days, a public debt CNAV MMF or a LVNAV MMF shall automatically cease to be a public debt CNAV MMF or a LVNAV MMF. The public debt CNAV MMF or the LVNAV MMF shall immediately inform each investor thereof in writing in a clear and comprehensible way.

3.

After the board of the public debt CNAV MMF or of the LVNAV MMF has determined its course of action with regard to both points (a) and (b) of paragraph 1, it shall promptly provide details of its decision to the competent authority of that MMF.

CHAPTER VI External support

Article 35

External support
1.

A MMF shall not receive external support.

2.

External support means direct or indirect support offered to an MMF by a third party, including a sponsor of the MMF, that is intended for or in effect would result in guaranteeing the liquidity of the MMF or stabilising the NAV per unit or share of the MMF.

External support shall include:

  • (a) cash injections from a third party;
  • (b) purchase by a third party of assets of the MMF at an inflated price;
  • (c) purchase by a third party of units or shares of the MMF in order to provide liquidity to the fund;
  • (d) issuance by a third party of any kind of explicit or implicit guarantee, warranty or letter of support for the benefit of the MMF;
  • (e) any action by a third party the direct or indirect objective of which is to maintain the liquidity profile and the NAV per unit or share of the MMF.

CHAPTER VII Transparency requirements

Article 36

Transparency
1.

An MMF shall indicate clearly which type of MMF it is in accordance with Article 3(1) and whether it is a short-term or a standard MMF in any external document, report, statement, advertisement, letter or any other written evidence issued by it or by the manager of the MMF, addressed to or intended for distribution to prospective investors, unit-holders, or shareholders.

2.

The manager of an MMF shall, at least weekly, make all of the following information available to the MMF's investors:

  • (a) the maturity breakdown of the portfolio of the MMF;
  • (b) the credit profile of the MMF;
  • (c) the WAM and WAL of the MMF;
  • (d) details of the 10 largest holdings in the MMF, including the name, country, maturity and asset type, and the counterparty in the case of repurchase and reverse repurchase agreements;
  • (e) the total value of the assets of the MMF;
  • (f) the net yield of the MMF.
3.

Any document of an MMF used for marketing purposes shall clearly include all of the following statements:

  • (a) that the MMF is not a guaranteed investment;
  • (b) that an investment in MMFs is different from an investment in deposits, with particular reference to the risk that the principal invested in an MMF is capable of fluctuation;
  • (c) that the MMF does not rely on external support for guaranteeing the liquidity of the MMF or stabilising the NAV per unit or share;
  • (d) that the risk of loss of the principal is to be borne by the investor.
4.

No communication by the MMF or by the manager of an MMF to investors or potential investors shall in any way suggest that an investment in the units or shares of the MMF is guaranteed.

5.

Investors in an MMF shall be clearly informed of the method or methods used by the MMF to value the assets of the MMF and calculate the NAV.

Public debt CNAV MMFs and LVNAV MMFs shall explain clearly to investors and potential investors any use of the amortised cost method or of rounding or both.

Article 37

Reporting to competent authorities
1.

For each MMF that it manages, the manager of the MMF shall report information to the competent authority of the MMF on at least a quarterly basis.

By way of derogation from the first subparagraph, for an MMF whose assets under management in total do not exceed EUR 100 000 000 , the manager of the MMF shall report to the competent authority of the MMF on at least an annual basis.

The manager of an MMF shall upon request provide the information reported pursuant to the first and second subparagraphs also to the competent authority of the manager of an MMF, if different from the competent authority of the MMF.

2.

The information reported pursuant to paragraph 1 shall comprise the following points:

  • (a) the type and characteristics of the MMF;
  • (b) portfolio indicators such as the total value of assets, NAV, WAM, WAL, maturity breakdown, liquidity and yield;
  • (c) the results of stress tests and, where applicable, the proposed action plan;
  • (d) information on the assets held in the portfolio of the MMF, including:
  • (i) the characteristics of each asset, such as name, country, issuer category, risk or maturity, and the outcome of the internal credit quality assessment procedure;
  • (ii) the type of asset, including details of the counterparty in the case of derivatives, repurchase agreements or reverse repurchase agreements;
  • (e) information on the liabilities of the MMF, including:
  • (i) the country where the investor is established;
  • (ii) the investor category;
  • (iii) subscription and redemption activity.

If necessary and duly justified, competent authorities may solicit additional information.

3.

In addition to the information referred to in paragraph 2, for each LVNAV MMF that it manages, the manager of an MMF shall report the following:

  • (a) every event in which the price of an asset valued by using the amortised cost method in accordance with the first subparagraph of Article 29(7) deviates from the price of that asset calculated in accordance with Article 29(2), (3) and (4) by more than 10 basis points;
  • (b) every event in which the constant NAV per unit or share calculated in accordance with Article 32(1) and (2) deviates from the NAV per unit or share calculated in accordance with Article 30 by more than 20 basis points;
  • (c) every event in which a situation mentioned in Article 34(3) occurs and the measures taken by the board in accordance with points (a) and (b) of Article 34(1).
4.

ESMA shall develop draft implementing technical standards to establish a reporting template that shall contain all the information referred to in paragraphs 2 and 3.

ESMA shall submit those draft implementing technical standards to the Commission by 21 January 2018.

Power is conferred on the Commission to adopt the implementing technical standards referred to in the first subparagraph in accordance with Article 15 of Regulation (EU) No 1095/2010.

5.

Competent authorities shall transmit to ESMA all information received pursuant to this Article. Such information shall be transmitted to ESMA no later than 30 days after the end of the reporting quarter.

ESMA shall collect the information to create a central database of all MMFs established, managed or marketed in the Union. The European Central Bank shall have a right of access to that database, for statistical purposes only.

Article 37a

Accessibility of information on the European single access point

From 10 January 2030, the information referred to in Article 4(7) of this Regulation shall be accessible on the European single access point (ESAP) established under Regulation (EU) 2023/2859 of the European Parliament and of the Council ([^E0008]). For that purpose, the collection body as defined in Article 2, point (2), of that Regulation shall be ESMA. ESMA shall draw that data from the information notified by the competent authorities in accordance with Article 4(6) of this Regulation for the purpose of establishment of the central public register referred to in Article 4(7) of this Regulation.

That information shall comply with the following requirements:

  • (a) be submitted in a data extractable format as defined in Article 2, point (3), of Regulation (EU) 2023/2859;
  • (b) be accompanied by the following metadata:
  • (i) all the names of the fund to which the information relates;
  • (ii) where available, the legal entity identifier of the fund, as specified pursuant to Article 7(4), point (b), of Regulation (EU) 2023/2859;
  • (iii) the type of information, as classified pursuant to Article 7(4), point (c), of that Regulation;
  • (iv) an indication of whether the information contains personal data.

CHAPTER VIII Supervision

Article 38

Supervision by the competent authorities
1.

The competent authorities shall supervise compliance with this Regulation on an ongoing basis.

2.

The competent authority of the MMF or, where relevant, the competent authority of the manager of an MMF shall be responsible for supervising compliance with Chapters II to VII.

3.

The competent authority of the MMF shall be responsible for supervising compliance with the obligations set out in the fund rules or in the instruments of incorporation, and the obligations set out in the prospectus, which shall be consistent with this Regulation.

4.

The competent authority of the manager of an MMF shall be responsible for supervising the adequacy of the arrangements and organisation of the manager of the MMF so that the manager of the MMF is in a position to comply with the obligations and rules which relate to the constitution and functioning of all the MMFs that it manages.

5.

Competent authorities shall monitor UCITS and AIFs established or marketed in their territories to verify that they do not use the MMF designation or suggest that they are an MMF unless they comply with this Regulation.

Article 39

Powers of competent authorities

Without prejudice to powers vested in competent authorities in accordance with Directive 2009/65/EC or 2011/61/EU, as applicable, competent authorities shall, in accordance with national law, have all supervisory and investigatory powers that are necessary for the exercise of their functions with respect to this Regulation. They shall, in particular, have the power to do all of the following:

  • (a) request access to any document in any form, and to receive or take a copy thereof;
  • (b) require an MMF or the manager of an MMF to provide information without delay;
  • (c) require information from any person related to the activities of an MMF or the manager of an MMF;
  • (d) carry out on-site inspections with or without prior announcement;
  • (e) take appropriate measures to ensure that an MMF or the manager of an MMF continues to comply with this Regulation;
  • (f) issue an order to ensure that an MMF or the manager of an MMF complies with this Regulation and desists from a repetition of any conduct that could infringe this Regulation.

Article 40

Penalties and other measures
1.

Member States shall lay down the rules on penalties and other measures applicable to infringements of this Regulation and shall take all measures necessary to ensure that they are implemented. The penalties and other measures provided for shall be effective, proportionate and dissuasive.

2.

By 21 July 2018, the Member States shall notify the Commission and ESMA of the rules referred to in paragraph 1. They shall notify the Commission and ESMA without delay of any subsequent amendment thereto.

Article 41

Specific measures
1.

Without prejudice to powers vested in competent authorities in accordance with Directive 2009/65/EC or 2011/61/EU, as applicable, the competent authority of an MMF or the manager of an MMF shall, while respecting the principle of proportionality, take the appropriate measures referred to in paragraph 2 where an MMF or the manager of an MMF:

  • (a) fails to comply with any of the requirements regarding asset composition, in infringement of Articles 9 to 16;
  • (b) fails to comply with any of the portfolio requirements, in infringement of Article 17, 18, 24 or 25;
  • (c) has obtained authorisation through false statements or any other irregular means, in infringement of Article 4 or 5;
  • (d) uses the designation ‘money market fund’, ‘MMF’ or of another designation that suggests that a UCITS or AIF is an MMF, in infringement of Article 6;
  • (e) fails to comply with any of the requirements regarding the internal credit quality assessment, in infringement of Article 19 or 20;
  • (f) fails to comply with any of the governance, documentation or transparency requirements, in infringement of Article 21, 23, 26, 27, 28 or 36;
  • (g) fails to comply with any of the requirements regarding valuation, in infringement of Article 29, 30, 31, 32, 33 or 34.
2.

In the cases referred to in paragraph 1, the competent authority of the MMF shall, as appropriate:

  • (a) take measures to ensure that the MMF or the manager of an MMF concerned complies with the relevant provisions;
  • (b) withdraw an authorisation granted in accordance with Article 4 or 5.

Article 42

Powers and competences of ESMA
1.

ESMA shall have the powers necessary to carry out the tasks attributed to it by this Regulation.

2.

ESMA's powers in accordance with Directives 2009/65/EC and 2011/61/EU shall be exercised also with respect to this Regulation and in compliance with Regulation (EC) No 45/2001.

3.

For the purpose of Regulation (EU) No 1095/2010, this Regulation shall be included under any further legally binding Union act which confers tasks on the Authority referred to in Article 1(2) of Regulation (EU) No 1095/2010.

Article 43

Cooperation between authorities
1.

The competent authority of the MMF and the competent authority of the manager of an MMF, if different, shall cooperate with each other and exchange information for the purpose of carrying out their duties under this Regulation.

2.

Competent authorities and ESMA shall cooperate with each other for the purpose of carrying out their respective duties under this Regulation in accordance with Regulation (EU) No 1095/2010.

3.

Competent authorities and ESMA shall exchange all information and documentation necessary to carry out their respective duties under this Regulation in accordance with Regulation (EU) No 1095/2010, in particular to identify and remedy infringements of this Regulation. The competent authorities of the Member States responsible for the authorisation or supervision of MMFs under this Regulation shall communicate information to the competent authorities of other Members States where such information is relevant for monitoring and responding to the potential implications of the actitivies of individual MMFs or MMFs collectively for the stability of systemically relevant financial institutions and the orderly functioning of markets on which MMFs are active. ESMA and the European Systemic Risk Board (ESRB) shall also be informed and shall forward that information to the competent authorities of the other Member States.

4.

On the basis of the information transmitted by national competent authorities pursuant to Article 37(5), ESMA shall, in accordance with powers conferred on it under Regulation (EU) No 1095/2010, prepare a report to the Commission in light of the review outlined in Article 46 of this Regulation.

CHAPTER IX Final provisions

Article 44

Treatment of existing UCITS and AIFs
1.

By 21 January 2019, an existing UCITS or AIF that invests in short-term assets and has as distinct or cumulative objectives offering returns in line with money market rates or preserving the value of the investment shall submit an application to the competent authority of the MMF together with all documents and evidence necessary to demonstrate the compliance with this Regulation.

2.

No later than 2 months after receiving the complete application, the competent authority of the MMF shall assess whether the UCITS or AIF is compliant with this Regulation in accordance with Articles 4 and 5. The competent authority of the MMF shall issue a decision and notify it immediately to the UCITS or AIF.

Article 45

Exercise of the delegation
1.

The power to adopt delegated acts is conferred on the Commission subject to the conditions laid down in this Article.

2.

The power to adopt delegated acts referred to in Articles 11, 15 and 22 shall be conferred on the Commission for an indeterminate period of time from the date of entry into force of this Regulation.

3.

The delegation of power referred to in Articles 11, 15 and 22 may be revoked at any time by the European Parliament or by the Council. A decision to revoke shall put an end to the delegation of the power specified in that decision. It shall take effect the day following the publication of the decision in the Official Journal of the European Union or at a later date specified therein. It shall not affect the validity of any delegated acts already in force.

4.

Before adopting a delegated act, the Commission shall consult experts designated by each Member State in accordance with the principles laid down in the Interinstitutional Agreement of 13 April 2016 on Better Law-Making.

5.

As soon as it adopts a delegated act, the Commission shall notify it simultaneously to the European Parliament and to the Council.

6.

The delegated acts adopted pursuant to Articles 11, 15 and 22 shall enter into force only if no objection has been expressed either by the European Parliament or by the Council within a period of 2 months of notification of that act to the European Parliament and to the Council or if, before the expiry of that period, the European Parliament and the Council have both informed the Commission that they will not object. That period shall be extended by 2 months at the initiative of the European Parliament or of the Council.

Article 46

Review
1.

By 21 July 2022, the Commission shall review the adequacy of this Regulation from a prudential and economic point of view, following consultations with ESMA and, where appropriate, the ESRB, including whether changes are to be made to the regime for public debt CNAV MMFs and LVNAV MMFs.

2.

The review shall in particular:

  • (a) analyse the experience acquired in applying this Regulation, the impact on investors, MMFs and the managers of MMFs in the Union;
  • (b) assess the role that MMFs play in purchasing debt issued or guaranteed by the Member States;
  • (c) take into account the specific characteristics of the debt issued or guaranteed by the Member States and the role that the debt plays in financing the Member States;
  • (d) take into account the report referred to in Article 509(3) of Regulation (EU) No 575/2013;
  • (e) take into account the impact of this Regulation on the short-term financing markets;
  • (f) take into account the regulatory developments at international level.

By 21 July 2022, the Commission shall present a report on the feasibility of establishing an 80 % EU public debt quota. That report shall have regard to the availability of short-term EU public debt instruments and assess whether LVNAV MMFs might be an appropriate alternative to non-EU public debt CNAV MMFs. If the Commission concludes in the report that the introduction of an 80 % EU public debt quota and the phasing out of public debt CNAV MMFs that include an unlimited amount of non-EU public debt are not feasible, it should present the reasons for that. In the event that the Commission concludes that the introduction of an 80 % EU public debt quota is feasible, the Commission may make legislative proposals to introduce such a quota, whereby at least 80 % of the assets of public debt CNAV MMFs are to be invested in EU public debt instruments. In addition, if the Commission concludes that LVNAV MMFs have become an appropriate alternative to non-EU public debt CNAV MMFs, it may make appropriate proposals to remove the derogation for public debt CNAV MMFs altogether.

The results of the review shall be communicated to the European Parliament and to the Council, accompanied, where necessary, by appropriate proposals for amendments.

Article 47

Entry into force

This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.

It shall apply from 21 July 2018, with the exception of Article 11(4), Article 15(7), Article 22 and Article 37(4) which shall apply from 20 July 2017.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

[^E0001]: Commission Directive 2007/16/EC of 19 March 2007 implementing Council Directive 85/611/EEC on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (UCITS) as regards the clarification of certain definitions (OJ L 79, 20.3.2007, p. 11).

[^E0002]: Regulation (EU) No 648/2012 of the European Parliament and of the Council of 4 July 2012 on OTC derivatives, central counterparties and trade repositories (OJ L 201, 27.7.2012, p. 1).

[^E0003]: Commission Delegated Regulation (EU) 2015/61 of 10 October 2014 to supplement Regulation (EU) No 575/2013 of the European Parliament and the Council with regard to liquidity coverage requirement for Credit Institutions (OJ L 11, 17.1.2015, p. 1).

[^E0004]: Regulation (EU) 2017/2402 of the European Parliament and of the Council of 12 December 2017 laying down a general framework for securitisation and creating a specific framework for simple, transparent and standardised securitisation, and amending Directives 2009/65/EC, 2009/138/EC and 2011/61/EU and Regulations (EC) No 1060/2009 and (EU) No 648/2012 (OJ L 347, 28.12.2017, p. 35).

[^E0005]: Regulation (EU) 2015/2365 of the European Parliament and of the Council of 25 November 2015 on transparency of securities financing transactions and of reuse and amending Regulation (EU) No 648/2012 (OJ L 337, 23.12.2015, p. 1).

[^E0006]: Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament and of the Council and repealing Council Directives 78/660/EEC and 83/349/EEC (OJ L 182, 29.6.2013, p. 19).

[^E0007]: Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, amending Regulation (EU) No 648/2012 of the European Parliament and of the Council, and repealing Directive 2005/60/EC of the European Parliament and of the Council and Commission Directive 2006/70/EC (OJ L 141, 5.6.2015, p. 73).

[^E0008]: Regulation (EU) 2023/2859 of the European Parliament and of the Council of 13 December 2023 establishing a European single access point providing centralised access to publicly available information of relevance to financial services, capital markets and sustainability (OJ L, 2023/2859, 20.12.2023, ELI: http://data.europa.eu/eli/reg/2023/2859/oj).

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