# Regulation (EU) 2017/1131 of the European Parliament and of the Council of 14 June 2017 on money market funds (Text with EEA relevance), Article 2a: Conditions for money market instruments and transferable securities


(1.) An instrument satisfies the conditions in this paragraph if it—
(a) is a financial instrument within paragraph 2, and
(b) satisfies one of the criteria in paragraph 3.
(2.) A financial instrument comes within this paragraph if it is—
(a) admitted to trading or dealt in on—
(i) a UK regulated market (within the meaning of Article 2(1)(13A) of Regulation (EU) 600/2014);
(ii) an EU regulated market (within the meaning of Article 2(1)(13B) of Regulation (EU) 600/2014 which operates regularly and is recognised and open to the public; or
(b) admitted to official listing on a stock exchange in a country other than the United Kingdom or a Member State;
(c) dealt in on a regulated market (within the meaning of Article 2(1)(13) of Regulation (EU) 600/2014) in a country other than the United Kingdom or a Member State which operates regularly and is recognised and open to the public provided that the choice of stock exchange or market has been approved by the FCA or is provided for in law or the fund rules or the instruments of incorporation of the investment company; or
(d) not admitted to trading.
(3.) An instrument satisfies one of the criteria in this paragraph if—
(a) it has a maturity at issuance of up to and including 397 days;
(b) it has a residual maturity of up to and including 397 days;
(c) it undergoes regular yield adjustments in line with money market conditions at least every 397 days; or
(d) its risk profile, including credit and interest rate risks, corresponds to that of financial instruments which have a maturity referred to in point (a) or (b), or are subject to a yield adjustment referred to in point (c).
(4.) Instruments satisfy the conditions in this paragraph if—
(a) the potential loss which a UCITS may incur with respect to holding those instruments is limited to the amount paid for them;
(b) their liquidity does not compromise the ability of a UCITS to comply with rule 6.2.16(3) of the Collective Investment Schemes sourcebook;
(c) reliable valuation is available for them—
(i) in the case of securities admitted to or dealt in on a regulated market as referred to in paragraph 2(a) or recently issued securities which satisfy the conditions in paragraph 5, in the form of accurate, reliable and regular prices which are either market prices or prices made available by valuation systems independent from issuers;
(ii) in the case of other securities as referred to in paragraph 6 in the form of regular and accurate information to the UCITS on the security or, where relevant, on the portfolio of the security;
(d) appropriate information is available for them as follows—
(i) in the case of securities admitted to or dealt in on a regulated market as referred to in paragraph 2(a) or recently issued securities which satisfy the conditions in paragraph 5, in the form of regular, accurate and comprehensive information to the market on the security or, where relevant, on the portfolio of the security;
(ii) in the case of other securities as referred to in paragraph 6, in the form of regular and accurate information to the UCITS on the security or, where relevant, on the portfolio of the security;
(e) they are negotiable;
(f) their acquisition is consistent with the investment objectives or the investment policy, or both, of the UCITS pursuant to the law of the United Kingdom which was relied on by the United Kingdom immediately before IP completion day to implement Directive 2009/65/EC;
(g) their risks are adequately captured by the risk management process of the UCITS.
(5.) A recently issued security satisfies the conditions in this paragraph if—
(a) the terms of issue include an undertaking that an application will be made for admission to official listing on a stock exchange or to another regulated market (within the meaning of Article 2(1)(13) of Regulation (EU) 600/2014) which operates regularly and is recognised and open to the public, provided that the choice of stock exchange or market has been approved by the FCA or is provided for in law or the fund rules or the instruments of incorporation of the investment company; and
(b) the admission referred to in point (a) is secured within a year of issue.
(6.) The securities referred to in this paragraph are—
(a) transferable securities or money market instruments which are not admitted to or dealt in on a regulated market as referred to in paragraph 2(a) or recently issued securities which satisfy the conditions in paragraph 5;
(b) precious metals or certificates representing them;
(c) ancillary liquid assets.

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Source: https://www.legislation.gov.uk/eur/2017/1131/article/2a (the official version)
Page: https://openlegislation.uk/eu-regulation-2017-1131/article-2a
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.