A Guide to Article 8 and 9 Funds in Europe

The European Sustainable Finance Disclosure Regulation (SFDR), officially known as Regulation EU 2019/2088, has been in effect for nearly two years. However, the regulatory landscape for sustainable investment disclosures continues to pose challenges for participants in the financial markets. The recent implementation of Delegated Regulation EU 2022/1288 has brought about significant changes by introducing more comprehensive rules governing the disclosure requirements established under the SFDR. In addition, the European Commission (EC) conducted a comprehensive assessment of the SFDR framework and launched a public consultation on the implementation of the SFDR on September 14, 2023. The in-depth nature of the Commission’s review is surprising. Accordingly, it seems that the SFDR framework could undergo a fundamental overhaul, although the legislative process for a significant reform of the SFDR would likely take several years. This guest article by Wilkie Farr attorneys David Jansen and Claudius Straub discusses the evolving regulatory landscape of sustainable investments in Europe under the SFDR, providing guidance to fund managers considering setting up an Article 8 or9 Fund in light of the latest regulatory developments. It also touches on the emerging environmental, social and governance disclosure framework in the U.S. and its differences from the SFDR. See “The E.U. Sustainable Finance Disclosure Regulation: New Disclosures for U.S. Asset Managers” (May 6, 2021).

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