Having regard to the following:

1. Art. 4(1), point 20, of the IFR provides the definition of investment advice, making reference to Art. 4(1), point 4, of MiFID II.
2. Art. 4(1), point 21, of the IFR provides the definition of investment advice on ongoing nature, stating that “‘investment advice of an ongoing nature’ means the recurring provision of investment advice as well as the continuous or periodic assessment and monitoring or review of a client portfolio of financial instruments, including of the investments undertaken by the client on the basis of a contractual arrangement”.
3. Art. 4(1), point 27, of the IFR provides the definition of Assets under management (AUM) for the purposes of the calculation of the corresponding K-factor under the IFR and states that AUM “means the value of assets that an investment firm manages for its clients under both discretionary portfolio management and nondiscretionary arrangements constituting investment advice of an ongoing nature”.
4. Recital 24 or the IFR clarifies that “K‐AUM captures the risk of harm to clients from an incorrect discretionary management of client portfolios or poor execution and provides reassurance and client benefits in terms of the continuity of service of ongoing portfolio management and investment advice”. 

It is possible to draw the following conclusions:

1. The combined reading of the above provisions, in light of the above recital, suggests that investment advice of an ongoing nature is indeed captured by K-AUM, regardless of whether such investment advice is within or outside the MiFID scope and of the reason therefore, namely of whether lying outside the MiFID scope is due to its generic, non-personal or ex post nature. However, as the purpose of the inclusion of the investment advice of an ongoing nature in K-AUM is precisely to provide reassurance that the risk of harm to clients from an incorrect discretionary management of their portfolios or poor execution on the portfolio concerned by this advice will be covered by capital requirements, such inclusion appears redundant only when both conditions are met, namely the investment advice is outside the MiFID scope, and the reassurance is already provided by capital requirements to which another investment firm, or credit institution, or financial institution, is subject to for that particular portfolio. Thus, when another investment firm, or credit institution, or financial institution, is subject to capital requirements for that particular portfolio (either directly – via K-AUM or similar provisions, or indirectly – via operational risk for instance), the investment firm providing investment advice outside of the MiFID scope should not be subject to K-AUM on the asset of that particular portfolio.  
2. Similarly, the activity of providing ex-post performance analysis (benchmarking service) by comparing the return of the portfolio to the return of a benchmark should be out of scope of K-AUM when another investment firm, or credit institution, or financial institution, is subject to capital requirements for that particular portfolio. 

The activity of screening and selecting asset managers is not reflected in either Art. 4(1) point 20, point 21 or point 27, of the IFR, thus it should not be included in the scope of K-AUM.