ISIN: IE00BFYN8Y92
Dear Shareholder
This letter is to inform you, on behalf of the board of directors of the ICAV (the Board) about proposed changes to the index that the Fund is tracking and related proposed changes to the supplement of the Fund (the Supplement).
Changes to the Index Methodology
The investment policy of the Fund is to invest, as far as possible and practicable, in all of the securities in proportion to the weightings comprising the EMQQ The Emerging Markets Internet & Ecommerce Index (the Index).
It is proposed that the methodology of the Index will be amended to provide for certain environmental, social and governance (ESG) screens and new country weightings.
Under the proposed changes to the Index methodology, companies will be evaluated based on ESG screens, with any companies violating any of the ESG screens excluded from the index universe, in addition to those companies for which an evaluation cannot be made due to insufficient and/or missing information or data.
The ESG screening is based on research and analysis provided by Minerva Analytics Limited and excludes companies from the Index universe which:
a) violate the UN Global Compact principles; and/or
b) are involved in, linked and/or derive a specified proportion of their revenues from: (1) Controversial weapons; (2) Conventional weapons; (3) Tobacco; and/or (4) Thermal coal.
It is also proposed that the Index methodology will assign market capitalisation percentage weights to constituents based on eligible countries. For example, China's weighting in the Index is limited to 45%, whilst South Korea's weighting in the Index is limited to 10%. Maximum weights will be dictated by the Index Committee (as defined in the Supplement) and constituent weights will then be assigned accordingly.
The proposed changes to the Index methodology do not significantly alter the asset type, credit quality, borrowing or leverage limits or risk profile of the Fund.
SFDR Classification and Consideration of Sustainability Risks
Following the proposed changes to the Index methodology, the Fund will promote, among other characteristics, environmental and social characteristics, by implementing an investment policy that seeks to provide exposure to publicly traded, internet and ecommerce emerging market companies which meet the Index provider's ESG criteria. Consequently, the Fund will disclose under Article 8(1) of 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 (as may be amended from time to time).
In seeking to track, before fees and expenses, the return performance of the Index when making investment decisions on behalf of the Fund, the Manager, in conjunction with the Investment Manager, has deemed it not relevant that further consideration should be given by the Investment Manager to sustainability risks or the adverse impacts of its investment decisions taken on behalf of the Fund on environmental, social and employee matters, respect for human rights, anti-corruption and anti-bribery matters as part of its implementation of the investment policy, as to do so would risk increasing tracking error between the returns of the Fund and the returns of the Index.
Change to the Index Name
It is proposed that name of the Index will be changed to "EMQQ The Emerging Markets Internet ESG-Screened Index".
Change to the Fund Name
It is proposed that name of the Fund will be changed to "EMQQ Emerging Markets Internet UCITS ETF" or such other name as may be approved by the Central Bank.
It is proposed that these changes will be effective on or around 21st June 2024. The changes will be reflected in a revised supplement which will be noted by the Central Bank shortly thereafter.
If you have any queries or if any of the above is not clear you should seek advice from your stockbroker, bank manager, legal adviser, accountant or other independent financial advisor.
Any further information in relation to the above may be obtained by contacting info@hanetf.com. This notice will also be available at www.hanetf.com.
Capitalised terms used in this notice shall have the same meaning ascribed to them in the latest version of the Prospectus unless the context otherwise requires.
We thank you for your continuing support of the ICAV.
Yours faithfully
Manooj Mistry
Director
For an on behalf of
HANetf ICAV
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