For the purpose of EU Directive, UCITS means a Undertakings for collective Investment Transferable Securities which operates by collecting funds from investors and invests in securities or other assets. There are two types of UCITS in Directive; In the first structure, UCITS has a separate legal personality and fund assets are owned by a investment company. In the second, the UCITS does not create a separate personality and its assets are hold on the behalf of investors by a unit by a trustee. The UCITS Directive is designed to promote the free movement of collective investment scheme and to make it easy market its unit in another Member State. The Directive set the exclusives from the Directive's scope as follows; the closed-end type, collective investment scheme which does not raise capital by public offering. In the Directive no UCITS shall start its business unless it has been authorised but such authorisation is valid for all Members State. So it is called "Passport". In the Directive a unit trustee's assets must be managed by a management company and entrusted to a depositary. However investment company can manage its assets by itself or through management company. Of course investment company's assets must be entrusted to a depositary as unit trustee. THe Directive contains several provision that requires investment policies to designed to protect investors. For examples it provides that UCITS may invest its assets only in the transferable securities, money market instrument etc.. Apart from the investment policy rule regulation the Directive imposes several prudential requirement on UCITS to protect investors. For example, the Directive prohibits investment company and management company and depositary from borrowing. In the comparison with our "Capital Market Act" most structures are similar each other however some provisions have stricter regulations.