Central Bank Publishes Revised Central Bank UCITS Regulations and Updated Guidance

The Central Bank (Supervision and Enforcement) Act 2013 (Section 48(1)) (Undertakings for Collective Investment in Transferable Securities) Regulations 2026 (2026 CBI Regulations) were published on 10 July 2026. They repeal and replace the 2019 Central Bank UCITS Regulations (as amended) to align the Irish domestic legal framework with Directive (EU) 2024/927 (UCITS VI) and to incorporate other legacy changes. On 10 July 2026, the Central Bank (CBI) also issued its Feedback Statement to CP161 and its updated Guidance on performance fees for UCITS and certain Retail Investor AIFs (the Performance Fee Guidance).

By way of background, on 9 September 2025, the CBI published Consultation Paper 161 (CP161), proposing updates to the 2019 CBI UCITS Regulations, the CBI Performance Fee Guidance and other policy changes. Following the consultation, the CBI issued its feedback statement.  

We summarise, below, the key changes provided for in the 2026 CBI Regulations, together with key changes made to the Performance Fee Guidance.

Liquidity Management Tools (LMTs):

One of the most significant developments in the 2026 CBI Regulations is the introduction of a comprehensive LMT framework:

• Managers should select at least one quantitative LMT and one anti-dilution LMT, with required prospectus disclosures (e.g. a requirement to disclose in the prospectus the LMTs and the circumstances in which under which the LMTs may be activated and deactivated).
• In-kind settlement arrangements are differentiated from in kind redemptions operated as an LMT. Transfers of assets to redeeming investors may continue to operate as part of a fund's normal dealing process without being classified as LMTs.
• Similarly, ordinary redemption charges that form part of a fund’s standard dealing arrangements are distinguished from redemption fees used as an anti-dilution LMT and will not be treated as a liquidity management tool
• (De)activations of LMTs will be captured through the Daily Investment Fund Returns to the CBI.
• The CBI must be notified without delay of the suspension of dealing in, or calculation of the net asset value of, a UCITS. 

Performance Fees:

The Performance Fee Guidance has been updated to align with ESMA’s ‘Guidelines on Performance fees in UCITS and certain types of AIFs’.

Key Changes made by the 2026 CBI Regulations and the Performance Fee Guidance:

• A broader range of performance fee methodologies are now provided for (e.g. hurdle rates, fulcrum fees and other symmetrical fee models) subject to compliance with specific minimum requirements.
• The disapplication of the requirement for performance fees to crystallise no more than once per year with regards to high water mark or high-on-high models, subject to certain conditions.
• Amendment to provide that performance fees are only payable where positive performance has accrued during the performance reference period.
• The addition of a requirement whereby the manager must ensure that the depositary (or a competent person appointed by the manager and approved by the depositary) has implemented measures to ensure that any performance fees payable by a UCITS are calculated in accordance with the UCITS constitutional document and offering document.
• The disapplication of the requirement for a performance reference period (i.e. the look-back period) with regards to fulcrum fee model or other symmetrical fee models. 

NAV-Based Fees:

A new prospectus disclosure requirement applies to NAV-based fees. Maximum recurring NAV-based fees (including research fees) payable out of fund assets must be disclosed in the fund prospectus.

UCITS Exchange Traded Funds (ETFs):

Changes have been made to include previous CBI UCITS Q&As on a statutory footing e.g. an update has been made to clarify that an Irish UCITS ETF can have different deadlines for cash and in-kind dealing. An update has also been made to permit the designation "UCITS ETF" to be used at sub-fund or share class level.

Other Notable Updates

• The rules on “Connected Party Transactions” are extended to any transaction between UCITS and unitholders, except in the case of subscriptions, redemptions, conversions or dividends.
• Side pockets are permitted for UCITS (where provided for in the constitution) in respect of assets whose economic or legal features have changed significantly or become uncertain due to exceptional circumstances.
• Additional capital requirements have been introduced for managers providing individual portfolio management services.

Next Steps

These changes apply with immediate effect. Fund boards are advised to review fund documents and related policies without delay to ensure compliance with the updated 2026 CBI Regulations and revised Performance Fee Guidance.

In the CBI Process Clarification published in February 2026, the CBI established a streamlined filing process for existing UCITS seeking to update fund documents to align with UCITS VI changes (and other non-material changes). This streamlined filing process remains open and is available to fund boards making changes to fund documents to incorporate updates required by the 2026 CBI Regulations and/or the Performance Fee Guidance. Depending on the nature of the proposed changes to the fund documents, shareholder approval or advance shareholder notice may be required prior to effecting the changes.

For more information and advice on these updates, please contact David Naughton, Doireann O’Daly, Katrina Smyth, Brónach Rafferty, or your usual contact within our Investment Funds and Financial Services Regulation department.