Remuneration systems; Authorisation to issue statutory instruments

(1) Capital management companies must establish, for managers, for employees whose activities have a material impact on the risk profile of the management company or of the investment funds managed (risk takers), for employees with control functions, and for all employees who receive total remuneration that puts them in the same income bracket as managers and risk takers, a remuneration system that is compatible with, and promotes, a sound and effective risk management system, that does not create incentives for taking risks that are inconsistent with the risk profile, the investment conditions, the articles of association, or the partnership agreement of the investment funds they manage, and that does not prevent the capital management company from acting, as it is obliged to do, in the best interests of the investment fund. Capital management companies must apply the remuneration system.
(2) The requirements for the remuneration system are governed, for AIF capital management companies, more specifically by Annex II of Directive 2011/61/EU, and for UCITS capital management companies, more specifically by Article 14a(2) and Article 14b(1), (3), and (4) of Directive 2009/65/EC.
(3) The Federal Ministry of Finance is authorised to issue, by statutory instrument not requiring the consent of the Bundesrat, for the purpose of elaborating and supplementing the requirements under Annex II of Directive 2011/61/EU and under Article 14a(2) and Article 14b of Directive 2009/65/EC, more detailed provisions on 1. the design of remuneration systems, including decision-making processes and responsibilities, the composition of remuneration, the design of positive and negative remuneration parameters, performance periods, and the consideration of the investment strategy, the objectives, the values, and the long-term interests of the capital management companies and the investment funds managed, 2. the monitoring, by the capital management company, of the adequacy and transparency of remuneration systems, and the further development of remuneration systems, 3. the possibility of prohibiting the payment of variable remuneration components, or limiting them to a certain proportion of the annual result, 4. the disclosure of the design of remuneration systems and the composition of remuneration, and the medium and frequency of disclosure. The provisions must, in particular, have regard to the size and remuneration structure of the capital management company and of the investment funds it manages, as well as its internal organisation and the nature, scale, complexity, risk content, and international character of its business. Within the framework of the provisions under the first sentence, point 4, the commercial-law provisions on the disclosure of remuneration under section 340a(1) and (2) in conjunction with section 340l(1), first sentence, of the Commercial Code must remain unaffected. The Federal Ministry of Finance may transfer this authorisation, by statutory instrument, to the Federal Institute.