BNY Mellon has won a mandate from BlackRock to provide custody and other services for its new UK Tax Transparent Fund (TTF), which is the first of its kind.

BlackRock launched the its ACS US Equity Tracker Fund on the back of the introduction of the TTF in July last year. The fund structure, introduced following consultation by the UK government, is designed to act as a tax efficient solution for investors.

“Given the ever increasing complexity for today’s investors, delivering simple, transparent, tax efficient solutions has arguably never been more important. The introduction of this new structure by the Treasury last year is an important step in the next generation of tax efficient solutions for UK investors. We also welcome the arrival of a level playing field, bringing the UK in line with other European fund centres,” said Tony Stenning, head of UK retail at BlackRock.

BNY Mellon will also provide fund administration and trustee services.

The TTF allow investors to keep their tax position and access double taxation treaty benefits as if they had invested in the fund’s underlying assets directly, while achieving the administrative, governance and scale benefits of investing through a pooled vehicle.

BlackRock’s new fund will initially be offered to the firm’s UK pension fund clients that invest in US equities before being extended to other asset class in the future.