The Overseas Funds Regime


Alexios Bostantzoglou

Publish Date



  • FCA
  • Compliance

Since Brexit and the UK’s withdrawal from the European Union, marketing a new fund in the UK that is domiciled overseas to retail investors has undoubtedly become much more of a challenge. This is set to change.

In late 2023 the UK Financial Conduct Authority (FCA) consulted on the Overseas Funds Regime (OFR), which was designed to recognize overseas funds and enable marketing to retail customers where the fund is domiciled in a jurisdiction approved by HM Treasury. It was created to provide a more streamlined route for overseas funds to market into the UK compared to the existing route for recognition of overseas funds – being either the Temporary Marketing Permissions Regime (TMPR) or s272 of the Financial Services and Markets Act, which is a lengthy and time consuming process. The OFR provides the ability for HM Treasury to grant equivalence in relation to specified categories of funds, assuming they apply for recognition to the FCA.


The backdrop for this regulatory change is that asset management is a global industry and many of the funds offered in the UK are domiciled outside of the UK. The OFR has been high on the FCA’s competitiveness agenda, and is designed to provide a new method for offering an overseas fund to UK retail investors. However, it is predicated on one key concept – equivalence. In welcome news, this has now been granted for EEA domiciled UCITS funds (except those which are authorised as Money Market Funds (MMFs)), as the Treasury has determined that the protections offered to investors or potential investors in other EEA states were equivalent with that of UK law.

Next Steps

The OFR will be available to new EEA UCITS that have not previously marketed to UK retail investors, as well as EEA UCITS that are currently operating under the TMPR.

Those schemes that are not currently in the TMPR are being given priority and the FCA intends to open a recognition gateway, via Connect, in September 2024. Those schemes in the TMPR will be issued landing slots from October 2024 for standalone UCITS. Umbrella UCITS therefore will have a little longer to wait in seeking recognition.  

The FCA has given itself two months to make any determination on recognizing a fund and until such time a determination is communicated to a firm, the scheme cannot be marketed. However, it is conceivable that by November 2024, new EEA UCITS could be coming to market in the UK.

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