National provisions governing the marketing requirements for UCITS

This page contains information on the national legal regulations governing the marketing requirements for standard funds in the Czech Republic in accordance with Article 5(1) of Regulation (EU) 2019/1156 of the European Parliament and of the Council of 20 June 2019 on facilitating cross-border distribution of collective investment undertakings.

1 Requirements for marketing foreign standard funds (UCITS[1]) on the market in the Czech Republic

Legal regulations governing the requirements for marketing foreign standard funds (UCITS) on the market in the Czech Republic:

(the abbreviation “UCITS” used in European legislation corresponds to the term “standard fund” under the AMCIF, the abbreviation “foreign UCITS” used in this text corresponds to the term “foreign fund comparable with a standard fund” used in the AMCIF)

The format and content of promotional materials and notifications, including the identification of information and documents to be notified to the competent authority before the start of marketing, is not determined by any regulations issued by the Czech National Bank. Marketing materials and notifications do not need to be sent to the Czech National Bank in advance. The Czech National Bank does not check, approve or give prior consent to their use when placing a fund on the market in the Czech Republic.

All marketing communications must comply with Articles 243–244 of the AMCIF. The sending of reports on promotional communications is not required. The Czech National Bank is entitled to request promotional communications in order to assess their compliance with the relevant legal regulations.

2 Public marketing of investments in the Czech Republic

Only investments in a foreign standard fund that has duly notified public marketing to the Czech National Bank pursuant to Article 93 of the UCITS Directive[1] and also has ensured the fulfilment of the tasks pursuant to Article 306 of the AMCIF can be marketed publicly in the Czech Republic. The performance of tasks pursuant to Article 306 of the AMCIF shall be understood as follows:

  1. the performance of instructions concerning the issuing, subscription and purchasing of securities or registered securities issued by this fund in the Czech Republic and the performance of the related payments, in accordance with the conditions contained in documents pursuant to Article 307 of the AMCIF,
  2. the provision of information to investors about how the instructions pursuant to letter (a) can be performed and on the division and payment of shares in the profit and other yields from the assets of this fund in the Czech Republic,
  3. the establishment of suitable procedures and measures to ensure the proper discussion of investor complaints and the removal of all restrictions for investors when claiming their rights,
  4. making information and documents available to investors for inspection and obtaining copies under similar conditions to those in Article 307 of the ACMIF,
  5. the provision of information to investors concerning the tasks that people perform, on a permanent data carrier, and
  6. the operation of the contact point for communication with the relevant bodies. The aforementioned activities can be arranged electronically or in another manner enabling remote access.

The public marketing of investments in a foreign standard fund (or a foreign investment fund comparable to a standard fund in accordance with the ACMIF terminology) in the Czech Republic is governed by Articles 305 to 307 of the AMCIF.

3 Notification of intention to market investments in foreign UCITS (“Notification”)

A foreign standard fund that intends to publicly market investments in the Czech Republic notifies its intention in accordance with Article 93 of the UCITS Directive by means of a notification, i.e., through a standardized form sent by the foreign standard fund to the competent authority of its host State. You can find a design for the notification for the cross-border marketing of standard funds at the Czech National Bank website.

Notification under the previous paragraph is not required in the case of the limited marketing of investments in a foreign standard fund that does not reach the intensity of public marketing (private placement). Public marketing is defined by the Opinion of the Czech National Bank “On the term ‘public’ in financial market regulations”, which you can find at the Czech National Bank website, including cases of the marketing of investments in a foreign standard fund to investment firms who acquire them for a client’s portfolio as part of the investment service of asset management (discretionary portfolio management).

Nor is notification required in the case of a foreign standard master fund (master UCITS) if it collects funds in the Czech Republic only from subordinate standard funds (feeder UCITSs). Notification is also not required if the investor makes the decision to invest in a foreign standard fund on their own initiative (Article 295 of the AMCIF) (reverse solicitation).

4 Entry onto a list

The Czech National Bank maintains, pursuant to Article 597(d) of the AMCIF, a list of foreign investment funds for which investment may be publicly marketed in the Czech Republic.

If all the legal conditions are fulfilled, the Czech National Bank makes the entry in the relevant list on the basis of a notification received (Article 305(1) of the ACMIF). An entry in the records is made automatically, the management company does not submit an application for entry in the list (Article 504(2) of the AMCIF).

5 Administrative fees

For information about fees collected and costs billed by the Czech National Bank in relation to the marketing of foreign standard funds in the Czech Republic we refer to the related document “Fees and costs”.

6 Changes to notification of intention to market investments in foreign UCITS (“Update of Notification”)

A foreign standard fund informs the Czech National Bank pursuant to Art. 93(8) of the UCITS Directive in writing of a change to a notification (e.g. of the expansion or narrowing of the classes of securities publicly offered in the Czech Republic, of changes concerning the manner of fulfilling the tasks pursuant to Article 306 of the AMCIF, of mergers, inclusion in master-feeder structures, the transfer of management or its liquidation) directly, not through the supervisory body of the home Member State. It informs about the change one month before the change is performed at the latest. It also informs its home supervisory authority of this change.

The preferred communication channel for the notification of changes is the sending of an e-mail to the address of the Czech National Bank’s electronic filing room: podatelna@cnb.cz . No specific e-mail subject line is required. In an e-mail, the notifier indicates the document affected by the change and briefly characterizes the change. A change requiring entry on the list of foreign standard funds, including the date on which the change is to be made, must be notified separately. In addition, a foreign standard fund must indicate the place, usually an Internet address, where the changed document can be found in updated electronic form.

7 Termination of marketing (“De-notification”)

If a foreign standard fund intends to terminate marketing in the Czech Republic, it sends the competent authority of its home State a notification of the termination of the notification pursuant to Art. 93a of the UCITS Directive. The effects of the notification end with the delivery of a written notification by the manager of the foreign standard fund to the home supervisory body. In the notification, the foreign standard fund must specify the manner in which it will ensure the fulfilment of these conditions:

  1. to publish, for a period of at least 30 working days, unified marketing for the purchase of all securities issued by the foreign standard fund meant directly or indirectly for all owners of these securities with a seat or residence in the Czech Republic, without any deductions, surcharges or payments,
  2. the intention to terminate the measures introduced for the purpose of the public marketing of investments in this foreign standard fund in the member state in question (in the Czech Republic in this case) to be published at least electronically in a public medium that is commonly used for the public marketing of investments in foreign standard funds in the Czech Republic and which is suitable for a typical investor investing in such funds, and
  3. all the obligations from contracts with distributors that enable them to publicly market investments in a foreign standard fund in the Czech Republic will be terminated or changed so that the public marketing will no longer be possible after this date by the date of the termination of the effects of the notification, at the latest.

The published information must contain a description of the consequences for the owners of securities issued by a foreign standard fund, if they do not accept the marketing for the purchase, and must be published in the Czech or Slovak language.

From the date of the termination of the effects of notification, a foreign standard fund will terminate all new or other direct or indirect marketing or placement of issued securities to which the terminated notification applies in the Czech Republic (see next paragraph).

The relevant bodies of the home member state of a foreign standard fund verify the completeness of the notification of the termination of the notification and hands over the notification to the Czech National Bank and ESMA, no later than within 15 working days from the day when they received the complete notification. The relevant bodies of the home member state of the foreign standard fund inform the manager of this fund of this handover without unnecessary delay. The effects of the notification end on the day when the manager of this fund receives a communication from the relevant organs of its home member state that the notification was handed over to the Czech National Bank and ESMA. After the termination of the effects of the Notification, a foreign standard fund must provide owners of securities issued by this fund that have their seat or residence in the Czech Republic with current documents pursuant to Article 304(1)(a) to (d) of the AMCIF and data pursuant to Article 304(1)(e) of the AMCIF through a remote means of communication in the Czech or Slovak language.

The sub-fund of a foreign standard fund terminates its activities in the same way as the foreign standard fund. In the case of classes of securities, the issue is the termination of activity only in relation to the last class of security. Until then, the termination of the marketing of one class of securities is notified to the Czech National Bank under Article 93(8) of the UCITS Directive, as stated above.

8 Deletion from a Czech National Bank list

The Czech National Bank will delete from the list of foreign investment funds whose securities may be publicly marketed in the Czech Republic, maintained under Article 597(d) of the AMCIF, a foreign standard fund that so requested under Article 506a(1)(a) of the AMCIF, that provided information about how it met the conditions specified in the paragraph on the termination of marketing, and at the same time notified the date it will cease its activities in the Czech Republic. The Czech National Bank will also welcome information on the reason for the termination of the activities. In the event of a transformation, the deletion of a foreign standard fund from the list is implemented on the date of the transformation causing it to cease to exist. In the case of only ending marketing in the Czech Republic or liquidation, a foreign standard fund is deleted on the date the marketing of the securities is terminated in the Czech Republic. The recommended design for the proposal for the deletion of a foreign standard fund from the list of the Czech National Bank is available on the Czech National Bank’s website.

The proposal may be submitted to the Czech National Bank directly or through the competent authority of the host Member State of the foreign standard fund if required by the legal regulations of the host Member State. A proposal is sent in electronic form to the address of the Czech National Bank’s electronic filing room: podatelna@cnb.cz .

The Czech National Bank will also delete a foreign standard fund from the list maintained pursuant to Article 597 of the AMCIF after the expiry of the validity period for the entry pursuant to Article 598(5) of the AMCIF, unless the renewing administrative fee was paid (see the related document “Fees and costs”).

Advice: The Czech National Bank has taken the necessary care to ensure that the information on national regulations governing the requirements for marketing foreign standard funds in the Czech Republic shown on this website is current and complete. The Czech National Bank is not responsible for the administration of external websites and is not responsible for any incorrect or missing information on any external websites linked by hyperlinks provided on this website.

Additional requirements: In addition to the AMCIF, other legal regulations may apply to the marketing of foreign standard funds in the Czech Republic, although they are not specifically intended for the marketing of foreign standard funds. Marketing in the Czech Republic may lead to the application of additional requirements, such as those relating to unfair commercial practices, information obligations towards consumers, advertising requirements and others.

Advice: This is not an exhaustive list of national legal regulations that could apply, and the Czech National Bank is not responsible for any omissions in this list. Supervision over compliance with the requirements arising from these legal regulations is not within the competence of the Czech National Bank. The applicability of those requirements and of any other legal requirements should be assessed before investing in or marketing foreign standard funds. In the case of uncertainty, entities marketing or investing in foreign standard funds should take independent advice on the requirements applicable to their individual situation.

Summary of the requirements for marketing foreign UCITS on the market in the Czech Republic

Relevant legal regulations:

Only investments in a foreign standard fund that has duly notified public marketing to the Czech National Bank pursuant and has ensured that the conditions for public marketing are met (Article 305 to 307 of the AMCIF) can be offered publicly in the Czech Republic.

Marketing materials do not need to be sent to the Czech National Bank in advance. The Czech National Bank does not check, approve or give consent to their use before the start of marketing of a foreign standard fund in the Czech Republic. All marketing materials must be in accordance with the requirements of Articles 243–244 of the AMCIF.

General legal regulations applicable to marketing and promotional communications:

[1] Directive 2009/65/EC of the European Parliament and of the Council of 13 July 2009 on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (UCITS Directive)