Schedule 10 - EU Sustainable Finance Disclosure Regulation (SFDR)
Version 1 - Released and Dated 14th November 2022
SCHEDULE 10 - EU SUSTAINABLE FINANCE DISCLOSURE REGULATION (SFDR)
Pursuant to the terms of the Regulation (EU) 2019/2088 (the “Disclosure Regulation” or “SFDR Regulation”) and the regulatory technical standards (the “RTS”) published by the Joint Committee of European Supervisory Authorities, financial market participants shall present the information to be disclosed in accordance with Article 8(1) and (2) of Regulation (EU) 2019/2088 and the Section III Article 13 of the RTS in an annexe to the Issuance Document as referred to in Article 6(3) of SFDR Regulation in accordance with a template set out in Annex II of the RTS.
Such information and statements will be disclosed in the relevant Final Terms referred to as “ESG disclosure”.
Such disclosure shall include a prominent statement as referred to in Article 6(3) of the SFDR Regulation that information related to environmental or social characteristics is available in that Final Terms.
The Final Terms will make the statement to explain the investment objectives of the Compartment:
does not promote environmental or social characteristics nor have a sustainable objective and do not integrate sustainable risks into investment decisions.
does not promote environmental or social characteristics nor have a sustainable objective but do integrate sustainable risks into investment decisions.
promotes environmental or social characteristics.
has a sustainable objective.
As a Financial market participant, it shall include a statement to explain:
(a) whether the Note(s) to be issued intends to make any sustainable investments;
(b) that the Note(s) promotes environmental or social characteristics, but does not have as its objective a sustainable investment; and
(c) whether an index has been designated as a reference benchmark for the purpose of attaining environmental or social characteristics promoted by the Notes.
(d) It shall present the information in summary format in the order and made up of the following sections titled:
(e) ‘What environmental and/or social characteristics are promoted by this Note?’;
(f) ‘What investment strategy does this Note follow?’;
(g) ‘What is the asset allocation or the Underlying Asset planned for this Note?’;
(h) ‘Does this Note take into account principal adverse impacts on sustainability factors?’;
(i) ‘Can I find more specific information online?‘; and
(j) where an index is designated as a reference benchmark for the purpose of attaining the environmental or social characteristics promoted by the Note,
(h) ‘Is a specific index designated as a reference benchmark to determine whether this Note is aligned with the environmental and/or social characteristics that it promotes?’.
By default, and unless otherwise stated in the relevant Final Terms, the investment decisions made for a Series of Notes – and consequently for the relevant Compartment – do not currently take into account Sustainability Risks (being understood as any environmental, social or governance event or condition that, if it occurs, could cause an actual or a potential material negative impact on the value of the investment, and as defined in the Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 on sustainability-related disclosures in the financial services sector (the “SFDR”)).
The Issuer does neither promote environmental or social characteristics nor have sustainable investment as an objective. The Issuer therefore considers that the best interests of the Noteholders are served by following the relevant Compartment’s investment objective and policy.
Should the investment objective of a specific Series of Notes be promoting such environmental or social characteristics or having sustainable investment as an objective, then the Issuer shall (i) mention such decision and objective in the relevant Final Terms and (ii) consider taking into account the impact of investment decisions on Sustainability Risks. For these reasons, the Issuer has also not undertaken an assessment of the likely impacts of Sustainability Risks on the returns on any Series of Notes at this point.
European Green Bond
The designation ‘European green bond’ or ‘EuGB’ shall only be used for bonds that comply with the requirements set out in the 201/0191 Regulation until their maturity. Such designation shall be mentioned in the relevant Final Terms of the Note.
Use of the proceeds of European Green bonds :
Before maturity of the bond, the proceeds of European green bonds shall be exclusively and fully allocated, without deducting costs, to the following, or a combination thereof:
fixed assets, including those of households, that are not financial assets;
capital expenditures, including those of households;
operating expenditures that were incurred more recently than three years prior to the issuance of the European green bond;
financial assets as referred to in Regulation Several obligations are to be met by the Issuer in such case.
Obligation #1 : Factsheet and pre-issuance review Prior to issuing a European green bond, issuers shall:
complete the European green bond factsheet laid down in Annex I;
ensure that the completed European green factsheet has been subject to a pre-issuance review with a positive opinion by an external reviewer.
The pre-issuance review of the factsheet shall contain all of the following:
an assessment of whether the completed green bond factsheet complies with Articles 4 to 7 of the Regulation and Annex I to the Regulation;
the elements set out in Annex IV to the Regulation.
Obligations #2 : Yearly Allocation Report
Every year and until the full allocation of the proceeds of the European green bond concerned, issuers of European green bonds shall draw up a European green bond allocation report by using the template laid down in Annex II, demonstrating that the proceeds of any European green bonds concerned from their issuance date and until the end of the year the report refers to have been allocated in accordance with Articles 4 to 7 of the Regulation.
Issuers of European green bonds shall obtain a post-issuance review by an external reviewer of the allocation report drawn up after the full allocation of the proceeds of the European green bond in accordance with Articles 4 to 7 of the Regulation. Issuers of European green bonds shall provide the allocation reports referred to in paragraphs 3, 4, and 5 to an external reviewer within 30 days following the end of the year to which the allocation reports refer. The post-issuance review must be made public within 90 days following the receipt of the allocation report.
Obligation #3: Green Bond Impact Report
Issuers of European green bonds shall, after the full allocation of the proceeds of such bonds and at least once during the lifetime of the bond, draw up a European green bond impact report on the environmental impact of the use of the bond proceeds by using the template laid down in Annex III of the Regulation.
This report is a one-off exercise. The Issuer may decide to prepare several reports during the life of the green bond. Obligation #4 : Website publications
Issuers of European green bonds shall publish on their website, in a distinct section titled ‘European green bonds’ and make available free of charge until at least the maturity of the bonds concerned, all of the following:
the completed European green bond factsheet referred to in Article 8, before the issuance of the bond;
the pre-issuance review related to the European green bond factsheet referred to in Article 8, before the issuance of the bond;
the European green bond annual allocation reports referred to in Article 9, every year until the full allocation of the proceeds of the European green bond concerned, no later than three months following the end of the year it refers to;
the post-issuance reviews of the European green bond allocation reports referred to in Article 9;
the European green bond impact report referred to in Article 10.
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