Funds Quarterly Legal And Regulatory Update: 1 April 2026 - 30 June 2026

1            APPROACHING DEADLINES/DATES OF INTEREST

2         UCITS & AIFMD

2.1              Publication of Irish implementing legislation transposing Directive (EU) 2024/927 into Irish law

On 1 May 2026, the statutory instruments which transpose Directive (EU) 2024/927, commonly referred to as “AIFMD II” or the “Omnibus Directive”, into Irish law were published.

These statutory instruments, which amend the Irish UCITS and AIFMD legislative framework, comprise of the following:

• European Union (Undertakings for Collective Investment in Transferable Securities) (Amendment) Regulations 2026; and

• European Union (Alternative Investment Fund Managers) (Amendment) Regulations 2026.

A copy of the Amending UCITS Regulations is available here.

A copy of the Amending AIFM Regulations is available here.

2.2         Publication of revised Central Bank AIF Rulebook and related Feedback Statement

On 5 May 2026 the Central Bank of Ireland (Central Bank) published a revised version of its AIF Rulebook along with a feedback statement to its consultation paper 162 published in September 2025 (CP 162).

The changes introduced are intended to align the domestic AIFMD framework with the revised European rules set down in in the Omnibus Directive which were recently transposed into Irish law via the European Union (Alternative Investment Fund Managers) (Amendment) Regulations 2026 relating to loan origination, liquidity management tools, delegation, reporting and depositary obligations.

The revised AIF Rulebook also introduces certain changes to the existing alternative investment fund (AIF) regulatory regime which significantly enhances Ireland as a domicile for such funds, with a particular emphasis on changes that support further growth of private asset funds in Ireland.

A copy of the revised AIF Rulebook is available here.

A copy of the Central Bank’s feedback statement on CP 162 is available here.

A detailed overview of the changes introduced by the publication of the revised AIF Rulebook is available here.

2.3          Publication of Irish implementing legislation transposing EMIR 3.0 Directive into the Irish UCITS regulatory framework

On 26th June 2026, the European Union (Undertakings for Collective Investment in Transferable Securities) (Amendment) (No. 2) Regulations 2026 were published (Amending UCITS Regulations).

The Amending UCITS Regulations update the existing European Union (Undertakings for Collective Investment in Transferable Securities) Regulations 2011 as amended to transpose the revised UCITS counterparty risk-spreading rules introduced under the EMIR 3.0 Directive into Irish law.

Under the revised framework, any derivative transaction entered into by an Irish UCITS (regardless of whether an exchange-traded or OTC derivative) which is not centrally cleared through (i) an EU clearing counterparty which is authorised by ESMA under the EMIR framework or (ii) a third country clearing counterparty which has been recognised by ESMA under the EMIR framework, will need to be taken into account when calculating its counterparty risk exposure for the purposes of complying with the UCITS counterparty risk limits.

The Amending UCITS Regulations came into operation on 25 June 2026.

A copy of the Amending UCITS Regulations is available here. 

2.4         Central Bank of Ireland publishes Notice of Intention relating to ESMA Guidelines on Liquidity Management Tools

On 7 May 2026, the Central Bank published a Notice of Intention relating to the ESMA Guidelines on Liquidity Management Tools of UCITS and open-ended AIFs (Guidelines).

In it, it confirms that it expects full compliance with the Guidelines from 7 May 2026. The Guidelines themselves confirm that they do not apply in respect of UCITS and open-ended AIFs established before 16 April 2026 until 16 April 2027.

A copy of the Notice of Intention is available here.

A copy of the Guidelines is available here.

2.5         Central Bank of Ireland publishes guidance on quantitative liquidity management tools

On 9 April 2026, the Central Bank published a document titled “Good practices on incorporating implicit costs into the calibration of price-based LMTs” (Good Practices Document).

In it, the Central Bank notes that the Good Practices Document is designed to assist fund managers in estimating the implicit costs associated with subscriptions and redemptions, including any significant market impact, and in incorporating these implicit costs in the calibration of price-based liquidity management tools which include redemption fees, swing pricing, anti-dilution levies and dual pricing.

A copy of the Good Practices Document is available here.

2.6         ESMA publishes final report on the simplification of EU reporting frameworks for funds and transactions

On 4 May 2026, ESMA published the following reports relating to the simplification of EU reporting frameworks for funds and transactions:

• final report on a harmonised approach to fund reporting (Final Report on Fund Reporting); and

• an interim report on the simplification of financial transaction reporting (Interim Report on Financial Transaction Reporting).

In the Final Report on Fund Reporting, ESMA notes that there is no single, coherent investment fund reporting framework currently in place and outlines a suite of recommendations for the development of an integrated reporting system for reporting of certain information to relevant national competent authorities (NCAs), including:

• the development of a common and single reporting template designed to be proportionate for different fund sizes and investment strategies;

• the introduction of a “report once, use many times” reporting flow based on collection of data by the relevant NCA and a centralised EU data hub;

• EU centralised data validation and analytics of reported data;

• the collection of relevant data remaining with the relevant NCA but the validation, storage and analytics of data being organised at EU level.

ESMA notes that it will take forward these conclusions in the context of its regulatory technical standards which it is required to prepare under the Omnibus Directive on enhanced reporting to NCAs under the UCITS and AIFMD frameworks. It intends to publish consultation papers on those regulatory technical standards later in 2026.

In the Final Report on Fund Reporting, ESMA has called for the delay of application of these technical standards by two years until April 2029 (being two years later than the timeframe contemplated under the Omnibus Directive). In its position paper on the proposed Market Integration and Supervision package, EFAMA has called on the European Commission to take steps to avoid a split implementation under which UCITS management companies and AIFMs would be required to comply with the high-level reporting obligations under the UCITS and AIFMD Directives by April 2027 while not being required to comply with the related regulatory technical standards until 2029.

The Interim Report on Financial Transaction Reporting identifies the main challenges in the current EMIR, SFTR and SFTR reporting frameworks. While ESMA does not put forward any policy recommendations, it outlines certain possible approaches to overcome these challenges, including instrument-based and dual-side simplifications and the introduction of a “report once” framework across EMIR, MiFIR and SFTR in the long term.

ESMA subsequently published its final policy recommendations on the streamlining of financial transaction reporting on 2 July 2026 (ESMA Final Report on Simplification of Financial Transaction Reporting).

A copy of the Final Report on Fund Reporting is available here.

A copy of EFAMA’s position paper on the proposed Market Integration and Supervision Package is available here.

A copy of the Interim Report on Financial Transaction Reporting is available here.

A copy of the ESMA Final Report on Simplification of Financial Transaction Reporting is available here.

2.7         ESMA publishes final report on CSA on compliance and internal audit functions of UCITS management companies and AIFMs

On 11 May 2026, ESMA published its final report on the common supervisory action (CSA) on compliance functions and internal audit functions within fund management companies which was initiated by it in conjunction with EU NCAs in 2025 (Final Report).

In the Final Report, ESMA notes that the majority of NCAs assessed the overall level of compliance of their supervised entities with relevant internal audit and compliance provisions as satisfactory. Annex 1 to the Final Report also details both good and poor practices in the area of compliance and internal audit functions identified by the NCAs in the course of the CSA.  

On the compliance function, poor practices included inadequate focus on risks which are relevant for the fund management company specifically (but not its group as a whole), insufficient follow-up monitoring and progress updates, lack of clear recommendations and deadlines, inadequate controls, lack of coordination between compliance monitoring and internal audit plans and inadequate compliance monitoring plans.

On the internal audit function, poor practices included poor internal audit reporting to senior management/the board of directors of the relevant management company, overly broad themes identified as areas of focus for the internal audit function and failure to subject the compliance function to an internal audit review.

ESMA also notes the importance of consulting with the compliance and internal audit functions before taking significant strategic decisions such as setting up new funds, entering into new delegation arrangements and engaging in new asset classes.

The Central Bank is expected to publish its findings from the CSA it conducted on selected Irish fund management companies in due course.

A copy of the Final Report is available here.

2.8         Central Bank of Ireland publishes paper on Financial Stability Risk Assessment of Irish Hedge Funds

In April 2026, the Central Bank published a financial stability risk assessment of Irish domiciled UCITS hedge funds and Irish domiciled AIF hedge funds (Assessment).

In it the Central Bank concludes that:

• hedge funds play an important role in the provision of liquidity and price discovery in financial markets but their use of leverage could impact financial stability;

• financial stability risk in the hedge fund sector can materialise through fire sales and/or counterparty losses for creditors, with potentially adverse consequences for the real economy;

• emerging risks from hedge funds have been identified across several key areas with Relative Value and Credit funds in particular displaying vulnerabilities due to high leverage and/or low liquidity;

• other key themes of concern include Euro area government bonds and UCITS hedge funds.

The Assessment will inform macroprudential surveillance and support ongoing supervisory engagement on the resilience of the sector.

A copy of the Assessment is available here.

2.9         ESMA publishes TRV Risk Analysis of Leveraged AIFs in the EU-2025

On 6 May 2026, ESMA published its annual risk assessment of leveraged AIFs in the EU for 2025 (ESMA TRV Risk Analysis).

The ESMA TRV Risk Analysis summarises the findings of its 2025 risk assessment, focusing on leveraged-related risks and the potential systemic relevance of different AIF categories.

A copy of the ESMA TRV Risk Analysis is available here. 

2.10       ESMA publishes TRV Report on LDI funds

On 23 June 2026, ESMA published a TRV Risk Analysis focusing on recent developments and methods for liquidity stress testing for liability driven funds (ESMA LDI TRV Risk Analysis).

The ESMA LDI TRV Risk Analysis considers the following:

• the risks associated with LDI fund business models, their use of leverage and the monitoring of their resilience to liquidity stress over time; and

• the incorporation of liquidity risks into a fund stress testing framework.

A copy of the ESMA LDI TRV Risk Analysis is available here.

3            CENTRAL BANK OF IRELAND

3.1            Central Bank of Ireland publishes report on board effectiveness of Irish fund management companies

On 20 April 2026, the Central Bank published a feedback report on the review it carried out last year on a cohort of Irish fund management companies on board effectiveness through the lens of diversity and inclusion (Report).

As part of its review, the Central Bank examined the composition of Irish fund management company boards and their senior management as well as the strategic decision-making process succession planning and their broader diversity and inclusion (D&I) practices within those fund management companies.

The Report sets down recommendations put forward by the Central Bank in the following areas:

• the need to embed diversity and inclusion in the composition and effectiveness of the board of directors, senior management and board committees;

• the importance of performing a formal and comprehensive assessment of the appropriateness of the continued use of the INED designation by any director who are in place for a prolonged period of time;

• strategic decision-making, including ensuring that diverse project teams advise the board on strategic decisions and clear minutes demonstrating challenge and discussion are maintained;

• board evaluations;

• succession planning.

While the review was carried out certain Irish fund management companies, the Report makes clear that it expects not only Irish fund management companies but other Irish regulated firms to consider the Report and to take appropriate steps to address any gaps or weaknesses and then develop and implement actions to mitigate any risk.

A copy of the Report is available here.

A detailed analysis of the Report is available here.

3.2           Central Bank of Ireland publishes Dear CEO letter on Thematic Review on Depositaries obligations to undertake risk assessments of the fund and fund management company at appointment and on an ongoing basis.

On 11 May 2026, the Central Bank published a Dear CEO letter outlining the findings from its thematic review to assess how depositaries applied the relevant UCITS and AIFMD risk management requirements to assess the risks associated with the nature, scale and complexity of a fund’s investment objective and strategy and the organisation of a fund management company, both at onboarding and on an ongoing basis (Dear CEO Letter).

Taking into account the fiduciary duty owed by the depositary to fund investors to undertake independent monitoring of the fund(s), the Central Bank considers that the due diligence and risk assessment conducted at onboarding and refreshed on an ongoing basis is fundamental to enable the depositary to devise effective and appropriate oversight procedures. It also highlights the importance of being able to effectively identify and manage any conflicts of interest that may arise between the Depositary and the fund, the fund management company or the relevant delegate.

Appendix 1 to the Dear CEO Letter sets out some general good practices observed by the Central Bank during the thematic review, categorised into (i) client acceptance and onboarding, (ii) due diligence processes and (iii) depositary independence/conflicts of interest management.

The Central Bank expects Irish depositaries to consider those good practices in the context of their own organisation and identify any potential enhancements which could be made to improve the ability of the depositary to manage relevant risks.

A copy of the Dear CEO Letter is available here.

3.3           Central Bank of Ireland publishes Consultation Paper 170: Regulatory Impact Assessments and the Central Bank’s Approach to Consultation

On 22 June 2026, the Central Bank published Consultation Paper 170 titled “Regulatory Impact Assessments and the Central Bank’s Approach to Consultation” (CP 170).

In CP 170, the Central Bank seeks feedback from stakeholders on aspects of its regulatory policy framework and policy. In particular, it seeks feedback on:

• a draft Statement of Approach to Regulatory Impact Assessment (RIA); and

• a proposed updated approach to public consultation.  

In the draft RIA, the Central Bank sets out a proposed structured framework for analysing regulatory proposals and outlines how it proposes to assess regulatory interventions, including identifying problems to be addressed, considering options and evaluating potential impacts, including on consumers and firms.

The proposed updated approach to public consultation outlines how the Central Bank intends to approach public consultations going forward which it notes reflects current practices and emerging thinking on how consultation can most effectively support policy development.

In both cases, the objective is to “support more consistent and transparent decision-making and contribute to a more predictable regulatory framework”.

The Central Bank has noted that CP 170 does not introduce new regulatory requirements or amend existing rules, stating that the consultation paper is focused on the processes and frameworks that support regulatory policy development and communication.

The consultation closes on 30 September 2026 with responses to be submitted through the Central Bank’s submission form or via stakeholderengagement@centralbank.ie.

A copy of CP 170 is available here.

3.4            Central Bank of Ireland publishes Dear CEO Letter on Thematic Review of the Compliance Function in MiFID firms

In May 2026, the Central Bank published a thematic assessment on the compliance function in the MiFID investment firm sector (Assessment).

While not directly applicable to Irish fund management companies, its findings may be of interest to those performing a compliance role given the broad non-sector specific findings of the Central Bank outlined in its Assessment.

Good practices identified by the Central Bank include ensuring adequate arrangements are in place during staff absences thus maintaining the compliance function on a permanent basis, carrying out on-site inspections of business areas to verify the effective implementation of policies and procedures in practice and the linking of compliance monitoring findings to identifying training needs in specific business areas. It also noted that board minutes should provide sufficient evidence of substantive discussion and challenge of compliance related matters to demonstrate board oversight of such matters. 

Similar to the findings of ESMA from its CSA on the compliance function in fund management companies outlined in Section 2.7 above, the Central Bank emphasised the importance of an active involvement of the compliance function in strategic decision-making regarding new products and business lines.

A copy of the Assessment is available here.

3.5           Recent speeches delivered by the Central Bank

Recent speeches delivered by the Central Bank relevant to the funds industry include:

• a speech delivered by Gavin Curran which considers (i) the increasing complexity of retail investment products, (ii) the importance of robust product governance frameworks which produce appropriate target markets and distribution strategies and good governance in distribution,  (iii) the need for fund management companies to treat distribution as part of the product lifecycle that sits within its core control framework,  (iv) the role of the administrator and depositary in maintaining the integrity, transparency and efficiency of authorised funds and (v) supervisory expectations of corporate governance frameworks within fund management companies;

• a speech delivered by Mary Elizabeth McMunn which addresses (i) the geopolitical and technological change and what it means for the funds sector, (ii) the increasing importance of resilience in the face of this change and (iii) how regulation must adapt to ensure that benefits of such technological change for investors and the economy in a risk-appropriate manner; and

• a speech delivered by Vasileios Madouros on the Central Bank’s approach to tokenised finance.

4            SUSTAINABLE FINANCE

4.1            SFDR 2.0 Negotiations

On 24 June 2026, the Council of the EU adopted its negotiating position on the proposals to overhaul the SFDR framework originally published by the European Commission in November 2025 (Council Negotiating Position).

Key changes to the European Commission’s proposal included in the Council Negotiating Position include:

• an obligation for all categorised funds to report on the principal adverse impacts (PAI) of their investment decisions on sustainability factors making mandatory use of at least three indicators from a list set down in EU legislation;

• clarifying the scope of the exclusion criteria which must be satisfied by funds categorising themselves as “Transition” products by permitting such funds to invest in companies active in the fossil fuel sectors which allocate at least 20% of their CAPEX to EU taxonomy-aligned activities which have a time-bound strategy to reduce greenhouse gas emissions;

• transition products being able to categorise investments in general-purpose issuances by public sector bodies as permitted investments subject to certain conditions being satisfied;

• an opt-out from the categorisation framework for AIFs offered exclusively to professional investors.

Separately, the Committee for Economic and Monetary Affairs of the European Parliament (ECON) continues to negotiate its position on SFDR 2.0 with a vote by ECON due to take place in July 2026 or September 2026, after which the file must then be considered by the European Parliament in plenary vote.

Key proposals understood to be currently considered by ECON include (i) the introduction of mandatory disclosure of engagement strategies adopted by the relevant fund (if any) for all three categories, (ii) mandatory PAI reporting for all three categories which includes disclosure of greenhouse gas emissions and exposure to companies active in the fossil fuel sectors and (iii) an alternative exclusion to allow Transition products to invest in certain fossil fuel issuers subject to specific criteria being satisfied.

Trialogue negotiations on the SFDR 2.0 file are expected to begin under the Irish Presidency of the Council later this year.

A copy of the Council Negotiating Position is available here.

An overview of the original proposal published by the European Commission in November 2025 is available here.

4.2              ESMA report on CSA on MiFID II sustainability aspects

On 6 May 2026, ESMA issued a public statement presenting the results of the common supervisory action (CSA) carried out by it and NCAs on the integration of sustainability by EU MiFID-regulated firms in their suitability and product governance processes and procedures over the course of 2024 and 2025 (Report).

In its Report, ESMA acknowledges the ongoing legislative developments under the EU Retail Investment Strategy and the review of the SFDR and provides some high level interim supervisory expectations on some key areas.

It emphasises the importance of:

• ensuring that clients’ sustainability preferences are collected in a clear, neutral and sufficiently detailed manner, using questionnaires which are usable and proportionate and which avoid unnecessary complexity;

• strengthening the consistency of product categorisation processes;

• accurate and comprehensive record keeping of clients’ sustainability preferences (including the matching process and any adaptations made);

• ensuring that the negative sustainability-related target market is clearly articulated in products that do not consider sustainability factors.

It advises NCAs to adopt a proportionate supervisory approach and encourages dialogue with relevant firms to address identified issues rather than prioritising enforcement actions (save in cases of clear breaches or mis-selling). ESMA commits to considering the results of the CSA in preparing revised MiFID II delegated acts on sustainability as part of future reforms of the EU sustainable finance framework.

A copy of the Report is available here.

5            MONEY MARKET FUNDS

5.1           European Commission publishes report and FAQ on EU MMFR

On 11 May 2026, the European Commission published a report (Report) on the EU’s regulatory framework for money market funds set down under Regulation (EU) 2017/1131 (MMFR). 

Alongside the Report, it also published an FAQ on the interpretation and implementation of certain provisions of the MMFR (FAQ) to provide further guidance to the market on how certain requirements of the MMFR should be complied with. This FAQ is intended to encourage a harmonised approach on the part of EU national competent authorities in supervising EU money market funds.

In its FAQ, the European Commission notes that the thresholds in respect of daily and weekly maturing assets set down in the MMFR should be considered as minimum thresholds. The Report notes that weekly liquid assets (WLA) resilience levels of 40% for stable NAV MMFs and 20% for VNAV MMFs are “sufficient to withstand stressed market conditions” and that EU MMFs would be able to withstand severe redemption shocks if WLAs at or above these resilience levels are held. The FAQ notes that intensified scrutiny should be applied by risk management teams of MMFs and their managers if the WLA maintained by an MMF falls below the applicable resilience levels.

The FAQ also provides further clarity on the action that should be taken by managers of MMFs when the regulatory limits set down in the MMFR have been breached.

A copy of the Report is available here.

A copy of the FAQ is available here.

A detailed analysis of this topic is available here.

5.2          Central Bank of Ireland publishes consultation on guidance for MMF weekly liquid assets

On 8 June 2026, the Central Bank of Ireland published a consultation paper titled "Guidance on Money Market Fund Weekly Liquid Assets Levels (CP168).

In it, the Central Bank proposes minimum weekly liquid asset (WLA) levels which it believes should be maintained by money market funds with the objective of increasing the overall liquidity maintained by the MMF that is available to be used in times of liquidity stress. 

The WLA levels proposed by the Central Bank in CP168 are consistent with those proposed by the European Commission in its recent report on the adequacy of the MMFR and related FAQ on the interpretation and implementation of certain legal provisions of the MMFR (addressed in further detail under Section 5.1 above).

Interested stakeholders should respond to CP 168 no later than 3 August 2026 via fundspolicy@centralbank.ie.  

A copy of CP 168 is available here.

A detailed analysis of this topic is available here.

5.3          Central Bank of Ireland publishes Notice of Intention on ESMA Guidelines on Stress Test Scenarios under the MMFR

On 26 May 2026, the Central Bank published a Notice of Intention on the ESMA Guidelines on Stress Test Scenarios under the MMFR (Notice of Intention).

In it, the Central Bank confirms that it expects full compliance with the ESMA guidelines on stress test scenarios which were published in March 2026 (ESMA Guidelines) from 26 May 2026 onwards when performing mandatory stress testing under the MMFR.

A copy of the Notice of Intention is available here.

A copy of the ESMA Guidelines is available here.

5.4          ESMA publishes consultation on its approach to guidelines on stress test scenarios under the MMFR

On 5 May 2025, ESMA published a consultation on its guidelines on stress test scenarios under the MMFR (Consultation).

In it, ESMA proposes replacing the publication of revised guidelines on an annual basis with a new framework under which the revised parameters (which are updated annually) to be used for stress testing MMFs would be published on a dedicated page on the ESMA website. The ESMA guidelines will continue to set down the methodology to be used to conduct such stress testing.

The deadline for submitting responses to the Consultation is 6 August 2026.

A copy of the Consultation is available here.

6            AML & CTF

6.1           AMLA consults on draft guidelines on business-wide risk assessments and draft RTS on group-wide requirements

On 17 April 2026, the EU Authority for Anti-Money Laundering and Countering the Financing of Terrorism (AMLA) published two consultation papers under the AML Regulation[1] which is due to take effect from July 2027:

• consultation paper on draft guidelines on business-wide risk assessment (BWRA). The guidelines set out minimum requirements for the BWRA and the additional sources of information to be taken into account when carrying out the BWR.  The consultation closes on 15 July 2026. The consultation can be accessed here.

• consultation paper on draft regulatory technical standards (RTS) on group-wide requirements and on additional measures on branches and subsidiaries in third countries. The draft RTS addresses organisational aspects related to group-wide requirements and define provisions related to information sharing among entities of a group. The RTS also provides criteria for identifying the parent undertaking in the Union in cases of two or more obliged entities in the Union belonging to a head office in a third country. It further extends group-wide requirements to structures other than groups and provides criteria to identify the parent undertaking in the Union in those cases.  The consultation closed on 15 June 2026. The consultation paper can be accessed here.

6.2          AMLA consults on draft RTS for Home-Host Supervisory Cooperation

On 11 May 2026, AMLA published a consultation paper on draft regulatory technical standards (RTS) under MLD6[2]. The majority of the provisions of MLD6 are required to be transposed into national law by 10 July 2027. The RTS specify the duties of home and host supervisors and establish practical arrangements for co-operation between them.  The proposed draft RTS combines foundational cooperation principles with specific provisions on 

• information exchange, including obligations to share information on the supervisor’s own initiative and upon request, with specific content requirements; 

• inquiries, setting out procedures for conducting or facilitating cross-border supervisory inquiries, including roles, timelines, and post-inquiry exchanges; and 

• common approaches, enabling supervisors to, where necessary, agree on coordinated or joint supervisory activities.

The consultation paper can be accessed here.

6.3          AMLA consults on draft guidelines on ongoing monitoring of business relationships under AML Regulation

On 3 June 2026, AMLA published a consultation on draft guidelines setting out expectations for ongoing monitoring of business relationships and transaction activity.

The first part of the draft guidelines outlines expectations for keeping customer documents, data and information up to date, through both so called periodic and event‑driven reviews, applied in line with a risk‑based approach. It sets out the sources of information that may be used by obliged entities to update the CDD information and shares non exhaustive lists of information that obliged entities should consider and assess during periodic customer information reviews and event trigger reviews.

The second part of the draft guidelines clarifies how obliged entities should design, implement and test monitoring frameworks to detect unusual or suspicious transactions and activities. It sets out proportionate approaches, including the use of manual, automated or semi-automated processes and controls and, where appropriate, advanced analytical tools.  The consultation will close on 3 September 2026.

The consultation paper can be accessed here. 

7            EMIR & SFTR

7.1           ESMA releases reporting templates and instructions for the Active Account Requirement

On 13 April 2026, ESMA published the reporting templates and instructions for the Active Account Requirement (AAR) reporting under EMIR 3.0[3].

The new templates set out how entities subject to the AAR should report the required information to their competent authorities. The standardised templates and instructions, along with the facilitation of consistent supervisory practices, ensure efficiency in AAR reporting across the EU.

The template instructions can be accessed here.

A related press release from ESMA explains that the first AAR reporting submission is expected on 31 July 2026, covering the period from 25 June 2025 to 30 June 2026. After the first submission, reporting will take place every six months, with submissions due on 31 January and 31 July of each year.

A copy of the press release can be found here.

8            DORA

8.1           Joint-ESA Report on major ICT-related incidents

On 3 June 2026, the European Supervisory Authorities (ESAs) published their first annual report under Article 22(2) of DORA[4], analysing major ICT-related incidents reported across the EU financial sector in 2025. This report considers the number of these incidents and the sectors in which they occurred, the impact on clients, transactions and financial counterparties, remedial actions and the costs incurred.

A copy of the report can be accessed here.

9            DATA PROTECTION

9.1           EDPB consults on a Data Protection Impact Assessment template

In April 2026, the EDPB published a draft template Data Protection Impact Assessment (DPIA), subject to consultation. The publication seeks to support organisations in complying with requirements imposed under Article 35 of the GDPR. The publication addresses the following key points:

• the template is designed to help organisations structure, harmonise and evidence DPIA processes. It aims to reduce inconsistencies across Member States where different DPIA templates and guidance currently exist;

• DPIAs are required where processing is likely to result in a high risk to individuals’ rights and freedoms, including the use of new technologies, profiling, or large-scale sensitive data processing;

• the template reflects the required elements under Article 45(7) of the GDPR; including the description of processes and purposes, the assessment of necessity and proportionality, the assessment of risks and the identification of mitigating measures and safeguards;

• the use of the template is not mandatory, and organisations may continue to use their own methodologies;

• the template is supported by an explainer document to assist with completion and understanding.

The consultation closed on 9 June 2026.

The EDPB template and explainer document can be accessed here. 

10        MISCELLANEOUS

10.1       ECON publishes draft reports on proposed EU Market Integration and Supervision Package

In December 2025, the European Commission published its Market Integration and Supervision Package (MISP) proposal[5] aimed at removing existing barriers to single market integration and simplifying the EU’s regulatory and supervisory framework.

On 11 June 2026, the European Parliament’s Committee on Economic and Monetary Affairs (ECON) published the following draft reports detailing its initial proposed amendments, as well as the rationale for such proposed amendments, to the European Commission’s MISP proposal:

• draft report on the proposed directive which amends the UCITS Directive, AIFMD and the MiFID II Directive (Draft Report on the MISP Omnibus Directive);

• draft report on the proposed omnibus regulation which amends fourteen existing EU financial services regulations, including the Cross Border Distribution of Funds Regulation, EMIR and the ESMA Regulation (Draft Report on the MISP Omnibus Regulation); and

• draft report on the proposed regulation which replaces the Settlement Finality Directive and amends the Financial Collateral Directive (Draft Report on the MISP Regulation on Settlement Finality).

The deadline for members of ECON to table amendments has been set as 16 July 2026.

Separately, the Irish Government has confirmed in its policy programme for its presidency of the Council of the EU that it aims to conclude negotiations on the MISP proposal during its term which runs from 1 July 2026 to 31 December 2026.

A copy of the Draft Report on the MISP Omnibus Directive is available here.

A copy of the Draft Report on the MISP Omnibus Regulation is available here.

A copy of the Draft Report on the MISP Regulation on Settlement Finality is available here.

10.2        Council of the EU adopts position on EU Retail Investment Strategy

On 5 June 2026, the Council of the EU endorsed the final compromise text of the EU Retail Investment Strategy.

The finalised legal text endorsed by the Council is not yet available.

However, our current understanding is that the compromise text will introduce the following changes to the UCITS and AIFMD frameworks:

• an obligation to carry out an undue costs assessment both prior to the fund being launched and on a periodic basis during the life of the fund;

• any obligation to carry out a documented “value-for-money” assessment on any fund marketed to retail investors to ensure that costs are justified and proportionate. This will involve carrying out a peer group comparison to other EU funds with similar characteristics; and

• an obligation to (i) assess on a yearly basis whether any undue costs have been charged to the relevant fund or its unitholders and (ii) reimburse impacted investors for any amounts unduly charged without delay.

The European Parliament must vote on the approval of the finalised legal text which is due to take place at the plenary meeting of the European Parliament scheduled for November 2026.

The likely application date of the new rules under the UCITS and AIFMD frameworks is early 2029 at the earliest.

10.3       IOSCO publishes final report on valuing collective investment schemes

On 1 June 2026, IOSCO published its final report on valuing collective investment schemes (Report).

The Report incorporates an updated set of valuation recommendations intended to enhance the reliability, consistency and transparency of valuation practices across global investment funds.

A copy of the Report is available here.

10.4       AI Act Round Up

(i)                    Council of the EU approves changes to the EU AI Act

On 29 June 2026, the Council announced that it had approved changes to the EU AI Act aimed at streamlining and simplifying the framework introduced in 2024.

Changes being made to the EU AI Act via an amending regulation include:

• the delayed application of rules governing high-risk AI systems from 2 August 2026 to 2 December 2027 for stand-alone high-risk AI systems and 2 August 2028 for high-risk AI systems embedded in products;

• a new deadline of 2 December 2026 (originally set as 2 August 2026) for providers to comply with transparency obligations for AI generated content known as watermarking obligations; and

• clarifying the competences of the EU AI Office for the supervision of AI systems based on general-purpose AI models.

The regulation amending the EU AI Act is expected to be published in the Official Journal shortly and will enter into force on the third day after its publication.

A copy of the Council’s press release is available here.

(ii)                   Irish National Cyber Security Centre publishes guidance on AI adoption

On 30 June 2026, the Irish National Cyber Security Centre (NCSC) published guidance titled “Securing AI Adoption in the Public Sector” (Guidance).

The Guidance is intended to help public sector bodies adopt artificial intelligence securely and is accompanied by an AI Cyber Security Risk Assessment which sets out the principal cyber security risks associated with AI deployments.

While the Guidance is designed for the public sector, the NCSC notes that the principles and measures set out therein are applicable to organisations of every kind.

A copy of the Guidance and AI Cyber Security Risk Assessment are available here.

(iii)                  EU AI Office publishes Code of Practice on Transparency Obligations under the EU AI Act

On 10 June 2026, the EU AI Office published a Cope of Practice to support compliance with transparency obligations under Article 50 of the EU AI Act.

It is intended to help providers and deployers of generative AI systems to comply with the obligations imposed under the EU AI Act relating to the labelling and marking of AI-generated content.

A copy of the Code of Practice, which has been confirmed by the European Commission, is available here.

(iv)                  European Commission publishes draft guidelines on the classification of high-risk AI systems under Article 6 of the EU AI Act

On 19 May 2026, the European Commission published draft guidelines on the classification of high-risk AI systems under Article 6 of the EU AI Act (Draft Guidelines).

The Draft Guidelines are intended to assist providers and deployers of AI systems in assessing whether an AI system should be classified as high-risk, thereby facilitating the uniform application and effective enforcement of Article 6 of the EU AI Act.

The Draft Guidelines set out the European Commission’s interpretation of certain concepts that are relevant for classification purposes and contain practical examples of AI systems that should or should not be classified as high-risk under the EU AI Act.

Stakeholders were invited to provide feedback on the Draft Guidelines by 23 June 2026.

A copy of the Draft Guidelines is available here.

Footnotes

1 Regulation 2024/1624

2 Directive (EU) 2024/1640

3 Regulation (EU) 2024/2987amending Regulations (EU) No 648/2012, (EU) No 575/2013 and (EU) 2017/1131 as regards measures to mitigate excessive exposures to third-country central counterparties and improve the efficiency of Union clearing markets

4 Digital Operational Resilience Act (Regulation (EU) 2022/2554)

5 For a detailed analysis of the proposals put forward by the European Commission in December 2025, see our briefing on the topic. 

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