For Immediate Release: Wednesday 10 December 2003

IMA WELCOMES INLAND REVENUE

RESOLUTION OF FUNDS OF FUNDS ISSUE

IMA welcomes the ruling by the Inland Revenue that non-UCITS funds of funds which invest in the new style “mixed” funds, permitted under new European legislation will now be eligible for ISA and PEP investment.

The Revenue has confirmed that, further to discussions with the IMA, a ruling had been made to remove the restrictions which prevented funds of funds investing in new-style UCITS securities funds. The IMA had earlier identified this unintended consequence of the regulations to amend the existing PEP and ISA regime.

The Revenue will be circulating a bulletin to PEP and ISA managers shortly to clarify their position and the regulations will be amended in due course 

Richard Saunders, Chief Executive of the IMA commented:

“We welcome this swift response by the Inland Revenue to our representations. This has averted a potentially damaging issue for the investment management industry. We appreciate the Revenue’s quick action and the open dialogue it has had with all parties concerned.”

-Ends-

For further information please contact:

Helen Stephenson, Communications Officer, IMA, 020 7831 0898

Ros Clark, Technical Adviser, IMA, 020 7831 0898

Richard Saunders, Chief Executive, IMA, 020 7831 0898

Notes to editors:

1.  UCITS stands for “Undertaking for Collective Investments in Transferable Securities”. It is an EU Directive which was adopted in 1985 for those retail investment funds which invest in securities and bonds, and can be marketed and sold in EU member states. Since its implementation an amending directive was adopted in the UK in November 2002 which extended the range of funds that were eligible for UCITS status. New funds included capital protected, money market and funds of funds. These “new-style” UCITS funds were eligible for PEP and ISA investment only from 17 November 2003.

2.  Funds of funds are collective investment schemes which invest in other authorised funds rather than investing directly into shares, bonds and gilts etc

65 Kingsway London WC2B 6TD 

Tel: +44 (0) 20 7831 0898 Fax:+44 (0) 20 7831 9975 

www.investmentuk.org 

Investment Management Association is a company limited by guarantee registered in England and Wales Registered number 4343737.  Registered office as above.