NAV error thresholds and correction rules by domicile

Run fund operations across several domiciles and the same NAV error gets seven different answers. A 0.4% pricing error on an equity fund is below Luxembourg's default 1.00% equity threshold. That changes if the fund has adopted a lower one (pt 36) or must apply a stricter distribution-country threshold (pt 37(v)). In the UK it sits under the 0.5% reference in FCA guidance, so the depositary may treat it as of minimal significance if controls meet the guidance standards. It is below Jersey's notification trigger and below the 0.5% that CP130 proposed for Ireland. It is already past Guernsey's record-and-report line. Rule 2a-4 in the United States and CIMA's rule in the Cayman Islands specify no percentage. In Cayman the NAV calculation policy in the offering document governs, and US correction practice is listed in To verify.

No regulator publishes this comparison. Each one publishes its own regime, and the changes arrive one domicile at a time.

Two terms carry the whole page. A materiality (tolerance) threshold is the error size, as a % of NAV or of the unit price, at which formal steps apply. Depending on the domicile, those steps are some or all of regulator notification, NAV recalculation and compensation. Below it, duties can remain. In Luxembourg the fund still assesses whether to compensate for non-significant dates (pt 39). In the UK the manager still records the error and reports it to the depositary, and the depositary may still require payment (COLL 6.3.6G, s.4(1) and s.5(4)). De minimis is different. It caps the individual payout, not the error. It is a per-investor amount below which compensation is not paid out, even when the error was material.

The full matrix, with the conditions and the primary source for every cell.

The one-line read: Luxembourg and Guernsey prescribe. The UK delegates to the depositary, guided by a 0.5% reference. Jersey notifies but does not remediate. Ireland proposed a regime in 2019 and never finished it.

Circular 24/856 entered into force on 1 January 2025 (pt 162). On that date it repealed Circular 02/77, the 2002 text that ran the market for two decades (pt 166). Errors detected between the circular's publication and 1 January 2025 still run under 02/77 (pt 163). A CSSF FAQ (Version 1, 24 December 2024) sits alongside it. It was still the current version listed on the CSSF's circular page as at 2026-07-06, and again as at 2026-10-06. The same page carries a UCI notification practical guide (v1.2, updated 17 July 2025) for the eDesk filing itself. This section is the comparison-level view. The point-by-point annotation of 24/856, covering scope, the active/passive gate, the eDesk form, de minimis and the FAQ in full, is on the Circular 24/856 annotated page.

Thresholds (pt 35)

The table above reproduces pt 35 and Tables 1 to 3. Several points belong on an operations checklist.

• Per sub-fund: thresholds are set per sub-fund, with one threshold across all share classes (pt 37(i)).
• Look-through: fund-of-funds, index trackers and feeders look through to the target exposure (pt 37(iv)).
• Foreign thresholds: a stricter threshold required by a distribution country, once adopted, applies to the whole sub-fund and every investor in it (pt 37(v)).
• Aggregation: sub-threshold errors that run simultaneously or in succession, and have not been treated, are aggregated. If together they reach the threshold, they count as significant (pt 38).
• Closed-ended UCIs: they sit outside the NAV-error chapter (Chapter 4) and file no NAV-error notifications. They must still correct NAV errors where appropriate (pt 27).

Notification (pts 152 to 158)

Every significant error goes to the CSSF on its prescribed form. All fields must be completed, the format may not be edited, and a quantitative impact calculation must be attached. The CSSF refuses incomplete filings (pts 153 to 155). The circular sets the deadline at 4 to 8 weeks from detection for an error that needs no investor compensation (pt 158). Where compensation reaches many investors across jurisdictions, the filing still goes in within that window. The compensation date follows later through the complete form, with monthly progress updates. Where the réviseur d'entreprises agréé (the fund's approved statutory auditor) must produce a special report, it is due within 3 months of the complete notification (pt 157). The CSSF does not approve your remediation. It takes the filing and reserves the right to intervene ex post (pts 159 to 160). Host-country regulators of any market where the fund is distributed must also be informed under local rules (pt 161).

Remediation (pts 39 to 47, 123 to 133)

Recalculate the NAV for every error date. Compensation is compulsory only for the dates the error was significant (pt 39). If the NAV was undervalued, compensate redeeming investors and the fund. If it was overvalued, compensate subscribing investors and the fund (Tables 4 to 5). The financial impact runs on a compound or non-compound method. Pick one in your procedures and apply it consistently (pt 47).

A de minimis amount may be applied to investor payouts. It is a lump sum reflecting actual bank charges, documented per fund or sub-fund. It never applies to amounts owed to the fund, which are paid down to the last unit of currency (pts 124 to 127). Compensation by allocating extra units skips de minimis entirely (pts 128 to 129). Clawback from investors who accidentally gained is acceptable for well-informed or professional investors, but "in principle not appropriate" for retail (pt 44). Unclaimable amounts owed to departed investors go to the Caisse de Consignation, Luxembourg's state deposit office for unclaimed funds (pt 132). Finally, the costs of running the correction cannot be charged to the fund (pt 133).

The Central Bank consulted on a full errors framework in CP130, Treatment, Correction and Redress of Errors in Investment Funds. It was published on 9 September 2019 and closed on 9 December 2019. It defined four error types: NAV error, investment breach error, fee error and control breach error. It proposed quantitative thresholds of 0.10% of NAV for MMFs and 0.50% for all other funds, overlaid with qualitative materiality factors. It also proposed an obligation to notify investors of any material error, whether or not redress follows. CP130 records that the 2015 thematic review found industry practice was to notify investors only when the error was above the materiality threshold and they were due redress.

Then nothing. In 2020 the Central Bank delayed the feedback statement as one of its COVID-19 measures. That text was on its website from 16 June 2020 (CBI, Central Bank Expectations in light of COVID-19, version of 16 June 2020). From 5 November 2020 it said it expected the feedback statement by Q1 2021 (CBI, current version). As at the last-verified date of this page, the CP130 page lists no feedback statement and no final rules. In the meantime, the general obligations below make up the operative regime.

• Reporting (UCITS): under Regulation 108(2), the management company notifies the Central Bank without delay of any breach of the UCITS Regulations or the Bank's requirements. The same duty covers events with a significant impact on the UCITS. The depositary notifies material breaches promptly under Regulation 119(3). It notifies non-material breaches unresolved after four weeks under 119(4). It keeps a written record of every breach under 119(5)(a), retained for at least six years (119(5)(b)). All numbering is from S.I. No. 316 of 2026, signed on 7 July 2026, which revoked S.I. No. 230 of 2019 (Reg 131). The same duties sat in Regulations 107(2) and 118(3) to 118(5) of the 2019 instrument. S.I. 316 contains no NAV-error-specific provision.
• Reporting (AIFs): the AIF Rulebook (July 2026 edition) requires an AIF to notify the Central Bank promptly of any material breach. The duty sits in Chapter 1, Section 2(i), para 5 for a Retail Investor AIF and in Chapter 2, Section 2(i), para 4 for a Qualifying Investor AIF. The depositary carries the same duty (Chapter 5, Part I, Section 1(iii), para 2). The Rulebook has no four-week rule for non-material breaches.
• Materiality: Irish Funds industry guidance sets the materiality level that administrators apply. That is industry guidance, not a Central Bank rule. CP130 confirms the guidance exists and that the Central Bank has "neither sanctioned nor approved" it. The figure the guidance uses is listed in To verify.
• De minimis: the industry-standard limits recorded in CP130 are €50 for retail investors and €500 for institutional investors. Again, this is practice, not rule. CP130 described them as appearing excessive, particularly for institutional investors.

For a cross-border operations team this gives a false sense of comfort. Ireland feels like Luxembourg because administrators apply near-identical playbooks, but the playbook has no statutory floor. If a counterparty disputes a remediation, you are arguing industry guidance, not a circular.

For FCA-authorised funds (UCITS-style and NURS), the rule is COLL 6.6.3R. The authorised fund manager must "take action immediately to rectify any breach of COLL 6.3" [valuation and pricing]. Where "the breach relates to the incorrect pricing of units", "the rectification must… extend to the reimbursement or payment" of money to unitholders or the scheme. The exception is COLL 6.6.3R(4): no reimbursement is needed where "it appears to the depositary [the] breach is of minimal significance".

No percentage appears in the FCA rules, but one appears in FCA guidance. COLL 6.3.6G, table section 5(2), says a depositary may consider an incorrect price of minimal significance if two conditions hold. The manager and depositary must meet the control standards in sections 2 and 3 of the table. The error must be less than 0.5% of the correct price. Where an error has several causes or runs over time, each price is considered separately (s.5(3)). The depositary may still require payment (s.5(4)). Individual sums that the manager and depositary reasonably consider immaterial need not normally be paid (s.5(8)). Because this is guidance (G), the 0.5% is a reference the depositary applies, not a rule you can cite as binding.

Notification runs on four routes in COLL 6.3.6G, table section 4. The manager records each incorrect price as soon as it is discovered and reports it to the depositary with the action taken (s.4(1)). The depositary reports breaches of COLL 6.3 to the FCA immediately, limited to instances it considers material (s.4(2), citing COLL 6.6.11G). It also reports immediately any error of 0.5% or more where it believes reimbursement is inappropriate (s.4(3)). It then reports with its recommendation and justification (s.5(6)). Finally, it makes a quarterly return summarising the number of incorrect prices (s.4(4), SUP 16.6.8R).

Firms also notify significant breaches under the general rule, SUP 15.3.11R. The guidance at SUP 15.3.12G weighs potential customer losses, frequency of the breach, systems-and-controls implications and any delay in identifying or rectifying it.

UK AIFs outside the authorised-fund regime (the FUND sourcebook) have no prescribed threshold or compensation grid. AIFMD-derived valuation obligations govern how the NAV must be produced. The UK assimilated text of Article 72(3) of Regulation (EU) No 231/2013 also requires the AIFM to have remedial procedures in place for an incorrect NAV calculation. That applies while the UK text remains in force (see To verify). Beyond that duty, what happens after an error is a matter for the fund documents and the general duty to treat customers fairly. Set the threshold and compensation method in the LPA or prospectus, because no rule prescribes them.

The advisory note on application states the scope. The Code applies to all unclassified collective investment funds holding a JFSC Certificate under Article 8B of the Collective Investment Funds (Jersey) Law 1988. Some parts apply only to particular types, such as OCIFs, Jersey Expert Funds, Jersey Listed Funds and Jersey Eligible Investor Funds. The notification duties in Principle 6 are not limited that way.

Para 6.7.6 covers "an error in the pricing of Units of the Fund greater than 0.5 per cent". Notice is due "as soon as the Fund becomes aware". An inability to calculate the NAV is separately notifiable on the same timescale (para 6.7.8). Both appear again in the Schedule 1 table of notifications and consents. The note to Principle 6 says these duties arise once the fund knows, or has reasonable grounds for believing, that the matter has occurred or may be about to occur. That holds even where it is outside the fund's control. Valuations must be "prepared in an appropriate, regular and timely manner" (s.3.8.1).

That is where it stops. The Code prescribes no correction methodology, no compensation duty, no de minimis and no investor-notification rule for pricing errors. Beyond para 6.7, every certified fund carries the general Principle 6 duties: dealing with the JFSC openly and co-operatively and notifying significant events (paras 6.1 and 6.2). Jersey Private Funds sit outside the certified regime entirely.

The listed, OCIF and eligible investor fund Guides add no pricing-error provision. The Jersey Listed Fund Guide requires the offer document to state how the fund's value is calculated (Schedule 3, para 2.1.13). So does the Jersey Eligible Investor Fund Guide (Schedule 5, para 3.2.10). The OCIF Guide (Schedule 4) requires the constitutive documents to state the valuation methods (para 6.1). The trustee or custodian must take reasonable care that the manager's valuation and pricing methods produce calculations that follow those documents (para 3.10). The OCIF Guide's one pricing percentage applies to a permitted fixed-price offer after the initial offer, lasting no more than 30 days. If the asset value moves more than 2.5% from the value used to set the fixed price, the manager defers dealing. It then calculates a new price as soon as possible (paras 6.13 and 6.13.1). The Expert Fund Guide (Schedule 2) likewise only requires the offer document to state the basis on which the fund's value is calculated (para 3.3.9).

Remediation in Jersey is therefore governed by the fund's constitutional documents, the administrator's service contract and the governing body's fiduciary judgment. For an OCIF, the trustee or custodian's para 3.10 oversight also applies.

Guernsey's regime lives in a GFSC guidance note, Pricing Controls in respect of Open-Ended Collective Investment Schemes. It applies to open-ended authorised and registered schemes under the Protection of Investors Law 1987. It is guidance the Commission applies when it monitors and enforces the Rules, and it works on two thresholds.

• 0.1% or more of the unit price: record it, report it to the Trustee with the corrective action taken, and fix the cause (s.5.1).
• 0.5% or more: the Trustee reports it to the Commission with a prescribed information pack (see the guidance appendix). The pack covers dates, cause in detail, per-day % impact, investors affected and compensation paid. The guidance states that "human error" is not enough as a cause. Compensation is normally required (ss.5.1, 5.3).

Below 0.5%, no compensation is normally required, but only if the manager can demonstrate compliance with the prescribed pricing-control standards (ss.2.1 to 2.14). These include price-source review, delegate oversight, monthly reconciliations to the Trustee's records and movement-limit checks signed off by senior staff. Without those controls, the manager cannot rely on the de minimis provisions (s.2, opening rubric).

Where an error persists across days, compensation is owed only for the days the error was 0.5% or more. Multiple simultaneous causes are combined (ss.5.3.3 to 5.3.4). A compensation chart (ss.5.4 to 5.6) allocates who pays whom across fund, manager, incoming and outgoing holders. A per-investor de minimis of £30 applies to payouts (s.5.4.1): individual sums under £30, or the currency equivalent at the valuation-point rate, need not normally be paid. In the published black-lined final version, the old £10 is struck through and £30 inserted. Clawback from investors who gained is a matter for the manager's legal and commercial judgment (s.5.7).

Throughout, "normally" means "unless the Trustee directs otherwise". The Trustee, not the Commission, is the day-one decision-maker. That includes whether a manager may rely on de minimis at all (s.4.3).

First, different thresholds inside one umbrella: a Luxembourg equity UCITS tolerates 1.00% by default. Its Irish twin has no binding threshold and follows industry guidance. Its Guernsey counterpart triggers a regulator report at 0.5%. One identical error can lead to three different filings.

Second, the stricter distribution-country threshold: Luxembourg's pt 37(v) applies where a country in which the fund's units are marketed requires a more restrictive threshold. The fund must then retain that threshold for the whole sub-fund and every investor in it. A new marketing registration can therefore tighten a Luxembourg tolerance without any change to the Luxembourg rules.

Third, the aggregation rule: Luxembourg counts stacked untreated sub-threshold errors as one significant error. Guernsey and UK guidance both test each affected price. Guernsey combines simultaneous causes on each day (ss.5.3.3 to 5.3.4). The UK considers each price separately where an error has more than one cause or runs over time (COLL 6.3.6G, s.5(3)). Only Luxembourg expressly combines separate untreated errors, whether simultaneous or successive. Ireland's CP130 proposed that the cumulative impact of an error across valuation points count towards materiality (p.10, factor (a)), but that proposal was never finalised. An error log that looks clean domicile by domicile can still be reportable in Luxembourg.

In Luxembourg the costs of correcting an error cannot be charged to the fund, directly or through higher fees (24/856 pts 133 to 135). In Guernsey a manager can rely on de minimis only with demonstrable pricing controls, and the Trustee decides whether it may (guidance s.2 and s.4.3). In the UK the minimal-significance route depends on controls meeting the COLL 6.3.6G standards (s.5(2)).