The Financial Conduct Authority (FCA) has released updated information and, together with HM Treasury, a “roadmap,” on the UK’s Overseas Funds Regime (OFR). It intends to accept applications from new funds (i.e. those not in the Temporary Marketing Permissions Regime (TMPR)) from September 2024. This is a welcome development for managers of new EEA UCITS that are not currently able to access the UK retail market.

The OFR will enable non-UK funds granted “equivalence” (see our prior blog) to be marketed to UK retail investors. At the outset, OFR will be available to most EEA UCITS (other than money market funds).

Currently, many EEA funds use the TMPR to market to UK retail investors. These funds will need to apply for recognition under OFR during a three-month landing slot. If they miss their slot, they will be removed from the TMPR and cease to be recognised for sale to UK retail investors until a successful OFR application has been made. The landing slot for stand-alone schemes will be 1 October 2024 to 31 December 2024. Landing slots for umbrella UCITS will be phased between 1 November 2024 and 30 September 2026 based on the UCITS management company’s name, beginning with ‘A’ between 1 November 2024 and 31 January 2025 and ‘B’ starting on 1 January 2025.

OFR applicants will need to submit an application under the OFR and pay a fee. The FCA will have 2 months from receipt of a complete application to make a decision.

A consultation on the application of the UK sustainability disclosure requirements to overseas funds in the OFR is expected in Q3 2024 with a view to any related legislative requirements coming into force in H2 2025.

Further guidance will be issued in due course.