{
    "ucits": true,
    "type": "ETF",
    "leverage": false,
    "derivatives": true,
    "swaps": false,
    "inverse": false,
    "replication_method": "physical",
    "complex_factors": "Use of currency forwards for hedging; no embedded derivatives or synthetic replication",
    "classification": "non-complex",
    "supporting_data": "The UBS (Lux) Fund Solutions - MSCI Japan Socially Responsible UCITS ETF is a UCITS-compliant ETF that primarily uses physical replication by investing directly in the underlying securities of the MSCI Japan SRI Low Carbon Select 5% Issuer Capped Index. It employs currency forwards solely for currency hedging purposes, which is considered derivative use limited to efficient portfolio management (EPM) with minimal impact on the risk-return profile. The fund does not engage in securities lending, leverage beyond UCITS limits, or hold embedded derivatives or structured products such as CLOs. The index tracked is transparent and well-documented, and the ETF's structure and risks (market volatility, tracking error) are straightforward and understandable by retail investors with basic knowledge. According to MiFID II Article 25(4)(a)(iv) and Article 57 criteria, UCITS ETFs using physical replication and limited derivative use for EPM are presumed non-complex. The absence of synthetic replication, embedded derivatives, significant leverage, or opaque features supports this classification. Therefore, this ETF is classified as non-complex under MiFID II, and no appropriateness assessment or comprehension alert is required for retail investors."
}