ESMA toughens transparency standards for funds with multiple share classes

Permits the continuing use of currency hedged classes

ESMA has proposed that all the differences between share classes of the same fund should be clearly disclosed to investors, as part of a raft of proposals aimed at creating a pan-European transparency standard.

In guidelines released today, the European Securities and Markets Authority (ESMA) said when investors have a choice between two or more share classes in one fund, the information about each share class should be provided via the fund's prospectus, to ensure a common level of transparency. It added the fund's UCITS management company should also provide a list of share classes in the form of readily available information, which should be kept current, while making stress test results for all share classes available to national competent authorities on request. IA to target fee transpa...