At the end of 2024, the AMF Position-Recommendation DOC-2020-03, commonly known as the AMF Doctrine, was amended to bring it in line with the European Securities and Markets Authority’s (ESMA) guidelines on fund naming.
This amendment ensures that ESG-related terms used in fund names comply with ESMA’s regulations as a minimum requirement. Zeidler Group recently delved into what this update means.
The AMF Doctrine regulates how investment funds that promote environmental, social, and governance (ESG) characteristics are marketed in France. It aims to combat greenwashing by enforcing stricter sustainability standards than those outlined in the Sustainable Finance Disclosure Regulation (SFDR). Meanwhile, ESMA’s guidelines introduce quantitative thresholds, requiring a certain percentage of a fund’s investments to be ESG-related or sustainable, alongside minimum safeguards, such as exclusion criteria.
The revised AMF Doctrine brings two significant changes. Firstly, funds can now reduce their investment universe by 20% through exclusions, a shift from the previous stance that disallowed exclusions alone to meet this requirement. This means that a fund can comply with the rule by excluding certain industries, such as tobacco producers or companies that violate the UN Global Compact.
Secondly, foreign funds marketed in France that comply with ESMA’s guidelines but do not meet AMF’s additional requirements must now include a mandatory disclaimer in their French marketing materials.
Additionally, the AMF made a minor update regarding the Transparency Code, a document that funds were previously required to model their non-financial approach on. The latest revision removes this requirement, while still recommending that funds provide a document explaining their sustainability approach.
The revised AMF Doctrine officially took effect on 1st January 2025.
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