On 19 December 2012, the European Commission (EC) published its delegated acts (the Level 2 Regulation) under the Alternative Investment Fund Managers Directive (AIFMD). The Level 2 Regulation provides the long awaited detail behind many of the elements of the Directive which sets out to regulate all managers of non-UCITS funds in Europe or marketing funds into Europe.
With the adoption of Level 2, we are publishing a series of Newsbriefs to provide a closer look at the requirements that AIFMs and depositaries will need to meet as well as issues they will be facing:
An overview of the key provisions of the Level 2 regulations is included in our Flash News: AIFMD: the final details take shape
After nineteen months of heated and controversial debates, both at an industry and at a political level, the final text of the Alternative Investment Fund Managers Directive (« AIFMD ») was adopted on its first reading in the European Parliament plenary session on 11 November 2010. The Directive was published in the Official Journal on 1 July 2011 and entered into force 20 days after its publication. The Member States are required to implement the Directive into their national laws within two years, i.e. mid-2013.
The European Securities and Markets Authority (ESMA) has been given the mandate by the EU to define Level 2 legislation in response to Level 1 text. The ESMA published on 13 July 2011 a consultation paper setting out its proposals for the detailed rules underlying the AIFMD. The consultation periods for the consultation papers closed in September 2011, leaving ESMA with the substantial task of having to review, distil and interpret over 100 responses to formulate its Final Advice to the Commission.
ESMA published its Final Advice on 16 November 2011to the European Commission on possible implementing measures. The final Level 2 regulation were issued by the European Commission on 19 December 2012.
The expected next steps are the following:
The AIFMD will heavily affect the non-UCITS sector. Gearing up for AIFMD requires all industry participants, especially managers, to start taking action as soon as possible.
With its 71 articles, the AIFMD will result in a number of significant alterations to the current organisational structure and business practice of the non-UCITS sector. With at least 48 subsidiary pieces of technical guidelines, rule making and review to follow, many more details on how AIFMD will apply in practice will emerge. There are a number of challenges to be addressed by the AIFMs in scope of the directive and we have listed some of the most important challenges ahead:
In addition to other conditions, there are certain requirements which may have major impacts for specific industries, like the asset stripping rules and requirements in case of investments in non-listed companies and issuers which will primarily affect the private equity industry.
We have a multi-disciplinary and multi-industry team of professionals in business strategy, operation and structuring, regulatory compliance, tax, remuneration and assurance services ready to assist you: identify and assess the many impacts of the Directive on your organisation and develop an integrated response to the AIFMD. Our team works closely with the PwC European AIFMD working group to ensure knowledge and best practices are shared on a Pan-European basis.
Tel: +352 49 48 48 2050