AI Summary of Article 56
The Directive imposes significant restrictions on investment companies managing common funds, prohibiting them from acquiring shares that confer significant influence on issuer management. Member States must consider existing definitions in other jurisdictions for this principle.
UCITS are limited to acquiring a maximum of 10% of non-voting shares and debt securities of a single issuer, 25% of units in other collective investment undertakings, and 10% of money market instruments. Waivers are available for specific categories of securities issued or guaranteed by Member States, third countries, or public international bodies, provided investment policies comply with established limits.
Article 56
1. An investment company or a management company acting in connection with all of the common funds which it manages and which fall within the scope of this Directive shall not acquire any shares carrying voting rights which would enable it to exercise significant influence over the management of an issuing body.
Pending further coordination, Member States shall take account of existing rules defining the principle stated in the first subparagraph in the law of other Member States.
2. A UCITS may acquire no more than:
(a) 10 % of the non-voting shares of a single issuing body;
(b) 10 % of the debt securities of a single issuing body;
(c) 25 % of the units of a single UCITS or other collective investment undertaking within the meaning of Article 1(2)(a) and (b); or
(d) 10 % of the money market instruments of a single issuing body.
The limits laid down in points (b), (c) and (d) may be disregarded at the time of acquisition if at that time the gross amount of the debt securities or of the money market instruments, or the net amount of the securities in issue, cannot be calculated.
3. A Member State may waive the application of paragraphs 1 and 2 as regards: