Inside this Topic Guide
The EU Alternative Investment Fund Managers Directive (AIFMD) regulates the management, administration and marketing of alternative investment funds (AIFs) in the European Union. An AIF is a collective investment undertaking that is not subject to the UCITS regime. This includes hedge funds, private equity funds, retail investment funds, investment companies and real estate funds.
Key issues covered by the AIFMD include authorisation and operating conditions for AIFMs, remuneration, conduct of business and valuation requirements, transparency, marketing and rules in relation to third countries. The Directive also includes requirements for firms acting as a depositary of an AIF.
| Status |
- AIFMD Directive published in OJ 1 July 2011 and entered into force on 21 July 2011.
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| Next |
- On 7 February 2024, the EU Parliament adopted a directive to improve the regulatory framework applicable to EU investment funds (AIFMD2).The directive still needs to be formally adopted by the EU Council before it can be published in the Official Journal. The new rules enter into force 20 days after publication in the Official Journal of the EU (OJ). Member states will have 24 months to implement AIFMD II.
- On 25 November 2021, the Commission adopted a Capital Markets Union (CMU) legislative package, including a proposal for a directive amending AIFMD (AIFMD2) following a review of the framework, with proposed changes covering delegation, loan-origination / liquidity rules, reporting and depositaries.
- Timing Uncertain: Extension of the passport to non-EU AIFs and AIFMs: the Commission has the power under Article 67(8) to adopt a delegated act which would extend the passport to non-EU AIFMs in accordance with Article 35 and 37-41. This delegated act has not yet been adopted.
- Timing Uncertain: Termination of national private placement regimes: The Commission has the power to adopt a delegated act under Article 68 that would specify the date on which national private placement regimes are to terminate if it has received a positive opinion in this regard from ESMA. ESMA's opinion is to be given after three years of entry into force of the delegated act referred to in Article 67(8), which has yet to be adopted.
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| Implementation |
- Member states will have 24 months to implement AIFMD II
- All EU member states have implemented the AIFMD which was incorporated into the European Economic Area Agreement (EEA Agreement) on 1 October 2016.
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| Other measures affecting the AIFMD |
- EMIR Refit, which entered into force on 17 June 2019, increased the scope of AIFs considered to be financial counterparties under EMIR.
- Provisions in the Disclosure Regulation (EU) 2019/2088 (SFDR) that affect AIFMs applied from 10 March 2021.
- Directive 2019/1160 amending the AIFMD with regard to cross-border distribution of funds (CBDF) applied from 2 August 2021.
- Delegated Regulation (EU) 2021/1255 as regards sustainability risks and sustainability factors to be taken into account by AIFMs applied from 1 August 2022.
- The EU's digital finance reforms – the EU is currently developing a new legislative package on digital operational resilience for the financial sector (DORA). The proposed package includes a draft directive that would amend the AIFMD to includes cross-references to DORA requirements.
- ESMA final report on notifications for cross-border marketing and management of funds – in December 2022, ESMA published draft ITS and RTS regarding the information and templates that firms should use when notifying regulators of their cross-border marketing and management activities under the UCITS Directive and AIFMD.
- ECA recommendations on investment fund framework – in February 2022, the European Court of Auditors (ECA) published a special report on the EU investment funds framework, concluding that EU actions have not yet created a true single market benefitting investors. The report set out five recommendations, as a result of which, further EU initiatives affecting the AIFMD regime may be developed.
- ESMA conducted various workstreams relating to the AIFMD in 2022, including: a common supervisory action on the valuation of UCITS and AIFs; and a discretionary peer review on depositary obligations under the AIFMD.
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