The Alternative Investment Fund Managers Directive (AIFMD) provides a comprehensive, harmonized and stringent regulatory and supervisory framework, on an EU-wide level, for the activities carried out by the managers of alternative investment funds (AIFMs), other than undertakings for collective investments in transferable securities (UCITS). The AIFMD does not aim at regulating the alternative investment funds (AIFs), but rather lays down rules for the AIFMs.
An AIFM is subject to either a full AIFM license or a registration requirement, which depends on the size of the AIFs managed by it and on the marketing to professional or retail investors. Exemptions to the AIFMD apply under specific conditions.
The AIFMD has significant implications for the AIF management and marketing. Requirements relate to business conduct, organizational structure and procedures, appropriate risk and liquidity management, delegation, valuation of the fund assets, principles of sound remuneration policies, appointment of a depositary, capital requirements and disclosure to investors and regulatory authorities. In addition to the requirements for the AIFMs, the directive indirectly affects service providers, such as depositaries and fund administrators. Furthermore, it imposes requirements on third-country asset managers to whom AIFMs delegate portfolio management.
Author: Ivo Habets