Regulation

The Alternative Investment Fund Managers Directive (the “AIFMD”) has come into force on 22nd July 2013 with a 12-month transition period. It applies in the EU member states and in the European Economic Area (“EEA”):

  1. The AIFMD is intended to regulate fund managers and not the funds that they manage.
  2. A non-EU fund manager of a non-EU fund will only be affected by the AIFMD if it wishes to market that fund to investors in one or more EU/EEA member states.
  3. The AIFMD can also have an indirect effect on non-EU fund managers or advisers if they are delegates of authorized EU AIFMs.
  4. The AIFMD allows each member state to decide whether to permit non-EU managers to market their funds in their jurisdiction. Each member state is free to impose its own “national private placement” regime, subject to certain minimum conditions.
  5. Using the private placement regime after 22nd July 2013, fund documents may therefore need to be amended to ensure that the fund manager is able to obtain all the information that it needs in order to comply with certain transparency and disclosure obligations imposed by the AIFMD on the fund managers.
  6. For a Non-EU AIFM marketing Non-EU AIFs, marketing is permitted in a given EU/EEA state only if
    1. that country permits active marketing under the “article 42” regime; or
    2. responding to a genuinely unsolicited request for information from an investor on a reverse enquiry basis (no required to comply with AIFMD)
  7. A non-EU fund manager planning to raise assets in Europe must carefully consider what changes may need to be made to its operations and marketing activities in order to comply with the private placement regimes in the EU member states or the EEA.

With the new regulation, UCITS funds are most requested by the European investors.

We can guide and help our fund manager clients under the new regulation to achieve their capital raising goals.