On 11 November 2024, the International Organization of Securities Commissions (IOSCO) issued a consultation report on revised recommendations for liquidity risk management for collective investment schemes (CIS), especially for open-ended funds. IOSCO is also consulting on complementary guidance for the effective implementation of the recommendations for liquidity risk management.

The recommendations describe a range of initiatives throughout the entire life cycle of the CIS, i.e., during both the pre-launch/design phase of the CIS and the on-going day-to-day operation of the

CIS, in order that responsible entities can appropriately design and implement an effective liquidity risk management process. Such process includes determining dealing arrangements in alignment with asset liquidity, monitoring and managing liquidity risks, considering and using liquidity management tools (LMTs) and other liquidity risk management measures, putting in place contingency plans to implement such tools as needed, and proper disclosure of liquidity risks and the liquidity risk management process, including the availability and potential use of LMTs to investors and prospective investors.

Next steps

The deadline for comments is 11 February 2025.

IOSCO will review progress by member jurisdictions in implementing the proposed revised liquidity recommendations and the proposed implementation guidance. The review process will begin with a stocktake, to be completed by the end of 2026, of the measures and practices adopted and planned by member jurisdictions.