Image2On 17 December 2021, the European Securities and Markets Authority (“ESMA”) published a letter (the “Letter”) addressed to the European Commission (the “Commission”) as a response to the questions raised by the Commission in their letter dated 24 September 2021. The Commission’s letter related to a consultation on facilitating cross border investment undertakings, which included the use of reverse solicitation.


The Commission sought input from national competent authorities (“NCAs”) on the following questions:

  • Have NCAs received any data from asset managers about the use of reverse solicitation, to the extent used in their jurisdiction?
  • Have NCAs obtained any other information about the use of reverse solicitation, e.g. from investor associations?
  • Can NCAs estimate the share of the use of reverse solicitation as compared to marketing?
  • Have NCAs observed any impact of reverse solicitation on the passporting regime?

Furthermore, the Commission sought input on whether the notification portal established in accordance with Article 13(2) should be developed, so that all transfers of documents between NCAs take place through it. As a result, this has been proposed for prioritisation in the 2022 IT ESMA budget.

ESMA Response

ESMA conducted a survey among various NCAs and invited them to respond to the questions above.

In the Letter to the Commission the key findings ESMA found were:

  • NCAs have no readily available information on the use of reverse solicitation either via asset managers or investor associations. As such, ESMA found that the vast majority of NCAs were not able to provide an estimation of the share of the use of reverse solicitation as compared to marketing. ESMA notes that this is because under EU law, asset managers are not subject to any obligation to report to their NCAs any information on e.g. investor subscriptions stemming from reverse solicitation. For example, in Italy, reverse solicitation was used by professional investors who engage with AIFMs.
  • Certain NCAs believe that the use of reverse solicitation is used to circumvent the use of third-country EU passporting regime post Brexit. Prior to Brexit, NCAs were able to passport their investment services in the EEA if authorised to do so under the passport scheme. However, post Brexit the Passporting regime has fallen away, hence the difficulty in direct marketing of cross border investment services. However, this is not confirmed by any tangible data.
  • Having reviewed commercial databases on market data there was no quantitative information on the use of and results of reverse solicitation.
  • For those EU jurisdictions (namely, Italy and Cyprus) which did provide statistical information to ESMA, it was clear that the use of reverse solicitation was significant in size.


The Commission is likely to issue its report to Parliament and Council during Q1 2022, so we will keep updated with the progress of the report.

To read the letter published the European Commission on 24 September 2021, please see here.

To read ESMA’s response to the European Commission which was published on 17 December 2021, please see here.

For more information, and any guidance or advice on the use of reverse solicitation by asset managers, Cleveland & Co External in-house counsel™, your specialist outsourced legal team, are here to help.