What is a UCITS? — Undertakings for Collective Investment in Transferable Securities (EU)
A UCITS is a fund authorised under Directive 2009/65/EC — the EU's harmonised retail fund regime. One home-state authorisation gives it a passport to be sold to the general public across the whole EU/EEA, in exchange for strict product rules: liquid, transferable assets, hard diversification limits, and a mandatory depositary. Everything that is not a UCITS is, by elimination, an AIF under AIFMD.
The regime dates back to 1985 (Directive 85/611/EEC) and was recast as 2009/65/EC — hence "UCITS IV"; Directive 2014/91/EU (UCITS V) then aligned the depositary and remuneration rules with AIFMD. The product discipline is what makes the retail passport possible: investments are limited to transferable securities and other liquid financial assets, and concentration is capped by the "5/10/40" rule in Article 52 — max 5% of assets per issuer, raisable to 10% provided all positions above 5% together stay under 40%. Redemption on demand is the default; investors can exit at NAV.
UCITS are also in the AIFMD II wave: the same amending directive (Directive (EU) 2024/927) amends the UCITS Directive on liquidity management tools and delegation, applying from 16 April 2026.
The practical gotcha: "UCITS" describes the product, not the manager — the management company (ManCo) is separately authorised, and one ManCo commonly runs UCITS and AIFs side by side under two different rulebooks. Don't assume a rule reads across.
Where this appears on FundRegTracker
- NAV error correction across domiciles — the Luxembourg thresholds are set per UCITS policy type
- AIFMD II implementation tracker — the UCITS-side LMT changes ride the same dates
- Regulatory calendar 2026