Key Updates To Ireland's UCITS Regulatory Framework

On 10 July 2026, the Central Bank of Ireland (the Central Bank) introduced a number of changes to the domestic UCITS rules and performance fee guidance. These reforms follow the CP161 consultation process, which ran from September to November 2025 (as outlined in our previous briefing), and should further strengthen Ireland's position as a leading domicile for retail investor products.

The Central Bank’s amendments are set out in the following:

• CP161 Feedback Statement;
• Central Bank (Supervision and Enforcement) Act 2013 (Section 48(1)) (Undertakings for Collective Investment in Transferable Securities) Regulations 2026 (S.I. 316 of 2026) (the "2026 CBI Regulations"); and
• Revised Guidance on Performance fees of UCITS and certain types of Retail Investor AIFs (the "Performance Fee Guidance").

The new 2026 CBI Regulations and Performance Fee Guidance follow on from the transposition of AIFMD II (Directive EU 2024/927) into Irish law earlier this year by way of the European Union (Undertakings for Collective Investment in Transferable Securities) (Amendment) Regulations 2026 (S.I. No. 182 of 2026) (the "UCITS Transposing Regulations"), as well as the recent enactment of the European Union (Undertakings for Collective Investment in Transferable Securities) (Amendment) (No. 2) Regulations 2026 (S.I. No. 289 of 2026).

What are the main changes?

Performance fees

The 2026 CBI Regulations and Performance Fee Guidance introduce several key changes, including: a new frequency of crystallisation requirement, subject to a number of exceptions; and broader alignment with the ESMA Guidelines on Performance Fees in UCITS and certain types of AIFs.

Verification of performance fee calculations has also been extended beyond the depositary. Instead, either the depositary or a competent person appointed by the responsible person and approved by the depositary may now verify that procedures are effectively implemented and that any performance fee payment is calculated in accordance with the fund’s constitutional documents and prospectus.

LMT alignment with the European framework

The 2026 CBI Regulations harmonise UCITS liquidity management tools ("LMTs") with AIFMD II requirements, as set down in the UCITS Transposing Regulations. When selecting LMTs, responsible persons should now consider selecting at least one anti-dilution tool (namely, redemption fees, swing pricing, dual pricing or, anti-dilution levy) and one quantitative-based tool (namely, redemption gates, extension of notice period or, redemption in kind), with all selected LMTs disclosed in the prospectus together with the terms and conditions under which the selected LMT can be activated and deactivated. A responsible person may establish side pockets, provided that the power exists in the constitutional document of the UCITS.

The 2026 CBI Regulations provide for the ability to (i) apply a charge on the redemption of shares and (ii) discharge redemption requests by way of an exchange of assets as part of its redemption policy, which are distinct from the use of redemption fees and redemptions in-kind as LMTs under the UCITS Transposing Regulations.

Redemption gates

The previous requirement that redemption gates could only be activated when requests exceeded 10% of total shares or NAV has been removed. Fund managers will now have significantly greater discretion to manage liquidity during stressed market conditions. To the extent that UCITS funds intend to avail of this flexibility, constitutional document provisions should be considered, along with any shareholder approvals/notifications that may need to be obtained/provided.

NAV-based fee disclosures

A new prospectus disclosure requirement now applies to any recurring NAV-based fees, improving fee transparency. In particular, the Central Bank had identified that certain fees (including research fees, calculated by reference to the NAV and paid out of the assets of the UCITS) were being absorbed into management fee disclosure without adequate transparency. The ability to remunerate and disclose distribution, paying agent, or representative agents out of the assets of the UCITS at normal commercial rates is retained.

ETF specific dealing provisions

Recent UCITS Q&A clarifications have been incorporated into the 2026 CBI Regulations, as well as new provisions that automatically accommodate operational differences for UCITS ETF share classes. In these circumstances, ETF managers will no longer need to submit individual derogation applications.

Connected party transactions

The scope of existing connected party transaction requirements has been expanded to include transactions entered into between the UCITS and a shareholder. However, a shareholder will not be treated as a connected party for transactions relating to its shares in the UCITS, including subscriptions, redemptions, conversions, or dividend payments. This places existing UCITS Q&A clarifications on a statutory footing and aligns the UCITS position with recent updates to the Irish AIF rules.

Money market funds (MMFs) and money market instruments (MMIs)

The Money Market Fund Regulation (EU) 2017/1131 created a dedicated regulatory framework for MMFs, replacing their prior treatment under UCITS rules. As a result, certain UCITS provisions for MMFs are now redundant, and the Central Bank has removed these obsolete rules from the 2026 CBI Regulations. The Central Bank has retained provisions relating to UCITS investments in MMIs under certain conditions.

Substance requirements

The Central Bank has retained minimum residency requirements for directors and designated persons of UCITS management companies. It retains a discretionary power to impose additional requirements at the point of authorisation, based on the nature, scale, and complexity of the firm.

Timing and next steps

The 2026 CBI Regulations came into effect without a transitional period on 10 July 2026. Existing UCITS and UCITS management companies should review their governing documentation (including offering documents, constitutional documents and policies) and ensure compliance with the new requirements. A fast-track filing option is available for updates made solely to comply with these requirements. However, any changes to investment objectives, policy, strategy, or SFDR classification must follow the standard post-authorisation filing process.