ESMA strengthens ETF cost transparency rules: what changes from July 1, 2026
The new directive requires issuers to disclose the actual TER (including transaction costs), not just the headline TER.
QFQuentin Fossé·Founder & Editor in ChiefThe regulatory context
ESMA (European Securities and Markets Authority) published new guidelines on February 15, 2026 strengthening cost transparency obligations for UCITS ETF issuers. These rules, effective July 1, 2026, substantially change how fees must be communicated to investors.
What changes: from TER to real total cost
Until now, ETF issuers were required to publish the TER (Total Expense Ratio). The new directive also requires publication of the total portfolio cost, which includes:
- Internal transaction costs (securities bought/sold within the fund)
- Entry and exit costs
- Performance fees where applicable
- Securities lending income (which reduces net cost)
For retail investors, this reform will make it easier to truly compare ETFs tracking the same index. The standardization imposed by ESMA should make these differences explicit in regulatory documents (KID, annual reports).