Talks continue on new Belgian AIFM directive compromise

Talks are continuing on a fresh compromise draft of the Directive on Alternative

Investment Fund Managers issued by the Belgian EU presidency last week despite
the failure of representatives of the European Parliament, the European Commissi
on and member states to reach agreement at a meeting in Brussels on Monday, Octo
ber 11.
The new round of meetings, which was scheduled to continue on Tuesday, follows F
rance’s indication that it is willing to compromise by allowing funds and managers
from outside the EU to benefit from the same marketing ‘passport’ as EU-based manag
ers, as long as their compliance with the directive is monitored by the future E
uropean Securities and Markets Authority.
The revised draft of the directive would offer non-EU managers a choice between
compliance with the directive in order to qualify for their funds to be marketed
freely within the EU, and continued use of national private placement rules.
The draft text says the private placement mechanism may be abolished after a tra
nsitional period of five years if the Commission certifies that that passport sy
stem is operating with “no negative effects” in areas including investor protection,
market disruption, competition and monitoring of systemic risk.
The draft also proposes the designation of a “member state of reference” that would
authorise the marketing of funds within the EU by non-EU managers and within whi
ch the manager must appoint a legal representative to act as a contact point for
EU-based investors and regulatory authorities.
By Olivier Sciales, partner of Chevalier & Sciales (Luxembourg). You may find mo
re information on our AIFM blog at http://www.cs-avocats.lu/aifm-directive. The
purpose of this blog aims to provide up to date news coverage and timely analysi
s of the legislative process and issues raised by the European union’s Directive o
n Alternative Investment Fund Managers.
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