THE EUROPEAN COMMISSION,

Having regard to the Treaty on the Functioning of the European Union,

Having regard to Regulation (EU) No 346/2013 of the European Parliament and of the Council of 17 April 2013 on European social entrepreneurship funds [OJ L 115, 25.4.2013, p. 18.], and in particular Article 9(5), Article 10(2) and Article 14(4) thereof,

Whereas:

(1) Managers of qualifying social entrepreneurship funds should adopt procedures and measures to ensure that persons engaged in such business activities carry out those activities in the best interests of the qualifying social entrepreneurship funds and their investors. To achieve a harmonised level of investor protection in the Union, and to enable those managers to adopt and follow a consistent and effective practice to prevent, monitor and manage conflicts of interest, a minimum set of steps should be listed in their conflicts of interest policy. To avoid unnecessary administrative burdens while ensuring an appropriate level of investor protection, the conflicts of interest policies should be adapted to the nature, scale and complexity of the managers' businesses.

(2) The procedures and measures set out in the conflicts of interest policies may be insufficient to protect the interests of the qualifying social entrepreneurship fund or its investors, in which case managers of qualifying social entrepreneurship funds should take necessary additional steps to protect those interests. Those steps should include informing the senior management or other competent internal body of the qualifying social entrepre­neurship fund, and taking the necessary decisions or actions to act in the best interest of the qualifying social entrepreneurship fund or its investors.