France Paves Way for First Active ETF Listings on Euronext Paris

The government move aims to "expand the distribution channels" of active ETFs.

Reviewed by: Staff
Edited by: James Rubin

The French government has made it possible for active ETFs to list in the country for the first time.

In a decree published by the prime minister on Feb. 27, the government said it would remove the conditions under its monetary and finance code which had previously prevented their listing.

Any listings will have to wait for the Autorité des Marchés Financiers (AMF) to publish an update to its regulations, expected imminently.

The decree will enable active ETF issuers to list their products on the Euronext Paris, a rapidly growing area of the market.

“These products, which are experiencing strong development in the U.S., could potentially expand the distribution channels of actively managed funds in Europe,” the government said.

“The decree modifies the monetary and financial code in order to remove this condition and thus allow the issue and admission to trading of active ETFs in France.

“This measure will contribute to the modernization of the range of savings products and the competitiveness of the Paris market.”

The code—first written in 2001—outlines what asset managers can list on the French stock exchange.

It was updated a few years later to integrate smart beta ETFs, adding the notion “based on an index or an algorithm.”

Business Advantages

The new updates will remove “index-based” from the code.

Olivier Paquier, global head of ETF sales at AXA Investment Managers, said: "We can identify two business advantages here. Firstly, investors tend to favor proximity and local stock exchange to buy, sell and process instruments."

“Secondly, international investors are watching closely European stock exchanges and are supportive of the fact that ETF providers are multi-listed.”

The active ETF market in the U.S. grew by 30% last year and is worth roughly $500 billion.

The European market has also experienced strong growth with $32.9 billion in assets under management (AUM) at the end of 2023, according to data from ETFbook.

JP Morgan Asset Management is the dominant force on the continent, generating a 42.5% market share since entering in 2018 with $14 billion in active ETF AUM.

There have been several new active ETF entrants in recent years, including AXA Investment Managers, abrdn, BNP Paribas Asset Management and Investlinx.

Theo Andrew joined ETF Stream as a senior reporter in September 2021. He has over four years of investment writing experience spanning pensions and retail investments, most recently at Citywire, where he was a senior reporter covering environmental, social and governance investing.