Brexit

1. How did you prepare for Brexit?

Following the EU referendum in 2016, M&G acted to minimise disruption to our clients, protect their interests and provide certainty and clarity where we could, regardless of the outcome of the Brexit negotiations.

We have built a new international hub in Luxembourg: a fully licensed and operational business distributing traditional and alternative funds and servicing our investors in Europe, Asia and America. 

We completed the migration of assets for most non-UK investors from our UK OEIC range to our Luxembourg SICAV funds in March 2019. Since then, EU and international investors in our funds have been serviced through our Luxembourg hub, while UK investors continue to be serviced in London.

Our Alternative Investment Funds (AIFs) were already largely domiciled in either Luxembourg or Ireland. The operation of these will now managed by our Luxembourg hub.

2. Can you continue to manage funds distributed in the EU from the UK?

In short, yes.

For EU and other international investors in SICAV mutual funds and AIFs, the UK Financial Conduct Authority, the European Securities and Markets Authority and the National Competent Authorities (NCAs) have confirmed that the Memorandums of Understanding enabling continued delegation of portfolio management activities will be valid from 1 January 2021.

For our existing EU clients who have appointed M&G Investments Management Limited (MAGIM) to manage their segregated or advisory mandates, we are putting in place a number of arrangements to ensure that we can continue to provide these services. This includes expanding the regulatory permissions of our EU-based entities, as well as the passporting of those permissions to the relevant EU-jurisdictions.

3. Can EU investors be able to remain invested in UK funds and UK clients in Lux-domiciled funds after Brexit?

For our EU-domiciled clients, UK-domiciled funds no longer retain their ‘Undertakings for Collective Investment in Transferable Securities’ (UCITS) status. This could have implications for EU investors, including tax consequences. All our strategies relevant to clients domiciled outside the UK are available as equivalent Luxembourg-domiciled SICAVs

For institutional investors in the UK, the FCA’s Temporary Marketing Permissions Regime (TMPR)  enables relevant firms and funds which passport into the UK to continue operating temporarily following the UK´s departure of the EU. 

Please reach out to your distributor or regular contact at M&G if you want to further discuss these at any time.