UCITS: treatment of breaches of UCITS global exposure limit

On 17 August 2021, the CSSF updated its FAQ on the UCI Law in order to add four new questions in a new Section 11 entitled "Treatment of breaches of the UCITS global exposure limit".

The new questions bring about certain clarifications in relation to passive and active breaches of VaR limits, notably:

• in what circumstances a breach can be considered as passive, the actions which the CSSF expects managers to take in case of passive breaches and confirmation that passive breaches do not need to be reported to the CSSF;
• the information that UCITS must communicate to the CSSF upon occurrence of an active breach of  VaR limits.