In the aftermath of CP86

Ahead of the Irish Funds Annual Global Funds Conference 2024 (to be held Thursday 23 May) Funds Europe talks to participants about regulation, private markets, and a potential change of government. 

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Pauline Plunkett, managing director, Legal & General Investment Management Ireland

Did CP86 – the consultation by the Central Bank of Ireland (CBI) – change Ireland from a fund servicing centre to a fund management centre?

The implementation of CP86 has been transformative to Ireland as a global funds hub for many reasons. The guidelines set out in the CP86 framework are designed to ensure Irish fund management companies are appropriately resourced with local cross-functional expertise who are proactive and responsible for ensuring robust governance and effective oversight of delegates. The transparency and robustness of CP86 provides assurance to investors that ‘client first’ is not just a mantra for Irish fund management companies but the core of their business. The impact is significant: After all, investor protection and confidence underpins the credibility and reputation of the funds industry.

Can Ireland become a market leader in ESG funds and sustainable investing? If so, how and why?

Ireland is fast emerging as one of the leading fund centres for ESG investing, with ESG funds accounting for over €1.2 trillion in AUM, which is 31% of all AUM, made up of 1,664 Article 8 funds and 159 Article 9 funds [official figures, at September 2023].  The Irish regulator has set a very high standard around the integration of sustainability risks and transparency of ESG characteristics to prevent ‘greenwashing’. The Central Bank of Ireland has clear expectations on fund boards and senior management to demonstrate a thorough understanding, ownership and management of ESG risk, with the introduction of SEAR (Senior Executive Accountability Regime) executives across the Irish fund management sector will necessarily continue to improve their knowledge and skills to meet regulatory expectations and meet investor demand.


Barry O’Brien, head of funds, FundRock/Apex Group

What are the most important regulatory developments facing Ireland?

The Central Bank of Ireland’s Fitness and Probity Regime, introduced by the Central Bank (Individual Accountability Framework) Act 2023 contains enhanced certification requirements which strengthen the control and governance framework for the fund sector generally. On the product side, on 11 March 2024, the Central Bank of Ireland finalised its position regarding the Irish Eltif by publishing an updated version of its AIF Rulebook. The revised AIF Rulebook now includes a new European Long-term Investment Fund (Eltif) chapter setting out the requirements applicable to Irish Eltifs. The aim of the Eltif is to widen the investor base and hopefully democratise access to private markets for the more retail market with exposure to illiquid private market assets.

Has CP86 changed Ireland from a fund servicing centre to a fund management centre?

The statistics certainly point to an increased number of authorisations of ManCos and AIFMs since CP86 with the self-managed funds being a thing of the past. Independent third-party management companies have benefitted from CP86 typically implementing a model where investment management is delegated to the portfolio manager.

What impact would a change of government have on Ireland’s funds industry, if any?

It is not anticipated that a change of government will have any significant impact on the funds industry as due to proportional representation in terms of the voting system, coalition government is a feature of Irish politics where a compromise approach and centre view is more likely rather than any extremist ideology. There is no desire to ‘kill the golden goose’.

The ESMA Fund Name Guidelines, which were published on 14 May, will require a significant effort by industry to meet the requirements.


Geraldine Brehony, senior manager, policy & regulatory, Irish Funds

What are the most important regulatory developments facing Ireland?

The ongoing debate in relation to macroprudential policy and financial stability is constantly evolving, at a domestic, European and international level. As a result, there will be a European Commission consultation and expected output from the Central Bank’s discussion paper on fund macro-prudential policy. Firms and regulators are also focussing their attention on the implementation of the updated IOSCO guidance and FSB Recommendations relating to fund liquidity, that were published in December 2023.

The ESMA Fund Name Guidelines, which were published on 14 May, will require a significant effort by industry to meet the requirements. The review of the Ucits Eligible Assets Directive could have significant implications for Ucits funds (including Irish Ucits funds) with direct or indirect exposure to certain asset classes such as loans, commodities and real estate. Although the agreement on the AIFMD review recognises and maintains the existing robust delegation model, the focus on substance, delegation and strategic autonomy continues as we enter the drafting phase of the AIFMD 2 level 2 regulations. This is evidenced by the expectation that ESMA will conduct a peer review on delegation in 2025.

We eagerly await the issuance of the Department of Finance’s Funds Sector 2030 review final report in August as well as the Eltif Level 2 RTS covering liquidity provisions, which are expected to be finalised in October 2024.


Ruth Fairclough, senior manager, industry collaboration, Irish Funds

Can Ireland succeed as a hub for private markets funds?

The Irish regulatory environment for investment funds is founded on the principles of openness, transparency and investor protection. Our members have been working with key stakeholders such as the Central Bank of Ireland and the Department of Finance to further expand Ireland’s attractiveness to encompass a broader spectrum of private asset investment strategies. Our recent efforts include significant focus on funds specialising in private equity, private credit, and infrastructure investments.  Notable milestones include the update to Ireland’s Investment Limited Partnership legislation in December 2020 and the establishment of a dedicated European Long-term Investment Funds chapter in our Alternative Investment Funds Rulebook in March 2024.

Several of our asset manager clients are looking to launch private capital products at scale to diversify their offerings.


Meliosa O’Caoimh, country head, Ireland, Northern Trust

Can Ireland succeed as a hub for private markets funds?

Yes. The Irish funds industry is competitively positioned alongside other jurisdictions to support quality fund mandates and build on traditional areas of strength such as exchange-traded and money market funds. Several of our asset manager clients, including many who have historically been more active in the traditional rather than alternatives space, are looking to launch private capital products at scale to diversify their offerings.

Additionally, Ireland’s European Long-term Investment Fund 2.0 regulation has been in effect since this year, broadening the scope of eligible assets and permissible investments, and allowing managers to invest in a broader range of real assets via this structure. It also expands the scope for investment in other funds and allows for master feeder Eltifs.

Eltif 2.0 also enhances the marketing and distribution rules to offer investors redemptions during the life of the fund, allowing for ‘semi-liquid’ evergreen Eltifs comprising both traditional and private market assets to be provided from Ireland.

The ability to offer a semi-liquid evergreen Eltif corresponds with the broader trend for having some liquidity in private credit strategies and, again, we are seeing increasing interest from clients to offer these structures to their investors.

Eight years on from the UK’s referendum, has Ireland started to reap the benefits of Brexit?

Ireland has played a key role during this period in helping UK managers plan how to match their investment management activities with their optimal path for both retaining investors and reaching new ones. As such Ireland has continued to enjoy sizeable asset flow in recent years, including from UK managers and investors.

Looking forward, we will likely see further upcoming changes in the international relationships between Ireland, the EU and the UK, and relationships between EU and UK regulators will of course evolve as the post-Brexit investment landscape develops correspondingly.

Use of Irish fund management companies and of fund vehicles should continue to be a valued solution for how asset managers can maintain and grow their European distribution while appropriately managing regulatory risk. Given the mutually beneficial links between the UK and Ireland, the success of both locations remains closely correlated.



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