Can aifs be marketed to retail investors?
Last Update: April 20, 2022
This is a question our experts keep getting from time to time. Now, we have got the complete detailed explanation and answer for everyone, who is interested!Asked by: Jade Denesik
Score: 5/5 (34 votes)
Marketing of AIF to retail investors. Article 43 provides that, subject to compliance with other European Union law, Member States may allow AIFM to market shares or units of AIF that they manage to retail investors.
Who does AIFM apply?
The Alternative Investment Fund Managers Directive (AIFMD) is a regulatory framework that applies to EU-registered hedge funds, private equity funds, and real estate investment funds.
Are AIFs regulated?
In fact, the AIF are less regulated than UCITS, in particular regarding the use of leverage, their investment policy, the short-selling practice etc., which are key elements in the determination of the risk level.
Can an AIFM manage a UCITS?
No, the services listed in Article 6(4) have to be part of the AIFM's authorisation to be obtained according to Article 6 AIFMD. Article 6(2) AIFMD specifies that the only additional authorisation that an AIFM can obtain is an authorisation to act as a UCITS management company.
Can a non EU AIFM manage an EU AIF?
Article 41(1) requires Member States to ensure that an authorised non-EU AIFM is allowed to manage EU AIF established in Member States other than that AIFM's Member State of reference.
Special Episode: The Rise of Retail Investing and Its Impact Across Market Participants
Can a fund of one be an AIF?
No. An undertaking that has no external manager and is managed by its own governing body may be an AIF. Question 2.6: Is the definition restricted to funds that invest in certain kinds of asset?
When did AIFMD become effective?
The directive came into force on 21 July 2011. On 16 November 2011, ESMA issued technical advice to the European Commission (EC) on possible implementation measures for Directive 2011/61/EU.
Can a MiFID firm be an AIFM?
MiFID investment firms (other than Exempt CAD firms).
In a private equity context, these are typically firms acting as an investment manager (but not an AIFM). These firms will be subject to the entirety of MiFID II.
What is the difference between UCITS and Aifmd?
The key difference between the two texts is that UCITS requires a “risk management process” that “enables it to monitor, measure at any time” whereas the AIFMD legislation require “risk management systems” that will be used “in order to identify, measure, manage and monitor all risks … to which each AIF is or may be ...
What is a master AIF?
an AIF in which another AIF (a feeder AIF) invests or has an exposure in accordance with the definition of 'feeder AIF'.
What are 4 types of investments?
- Growth investments. ...
- Shares. ...
- Property. ...
- Defensive investments. ...
- Cash. ...
- Fixed interest.
Are alternative investment funds regulated?
Venture Capital Funds (VCFs) registered under the repealed SEBI (Venture Capital Funds) Regulations, 1996 ("VCF Regulations") may seek re- registration under SEBI (Alternative Investment Funds) Regulations, 2012 subject to approval of two-third of their investors by value of their investment.
What qualifies as an AIF?
Under AIFMD, an alternative investment fund or “AIF” is: ... Both open-ended and closed-ended vehicles and listed and un-listed vehicles can be AIFs for the purposes of AIFMD.
Is an AIFM a ManCo?
For alternative investment fund (AIF) promoters looking to domicile and market their AIF in Europe, outsourcing core alternative investment fund manager (AIFM) functions to a provider of third-party management company (ManCo) and AIFM services is a quick, cost effective and compliant route to cross-border distribution.
What does AIFM stand for?
The AIFM Directive (Alternative Investment Fund Managers Directive) is a European Directive which has introduced a harmonised regulatory framework to which managers of alternative investment funds must comply as of 22 July 2013.
What are AIFM fees?
Ireland offers a very attractive taxation regime for AIFMs with the AIFM being taxed at either 12.5% or 25% on its profits. investment by the AIFM in an AIF which it manages may also qualify for the 12.5% tax rate.
What does UCITS cover?
UCITS stands for Undertakings for the Collective Investment in Transferable Securities. This refers to a regulatory framework that allows for the sale of cross-Europe mutual funds. UCITS funds are perceived as safe and well-regulated investments and are popular among many investors looking to invest across Europe.
How much cash can a UCITS hold?
UCITS are not allowed to borrow except for temporary cash flow mismatches up to a limit of 10% of Net Asset Value. This mechanism is thus designed to protect the interests of the remaining shareholders in the case of large redemptions. Liquidity risk management is an increasing focus for regulators.
What is UCITS V?
The UCITS V Directive (“UCITS V”) amends the regulatory framework for Undertakings for Collective Investment in Transferable Securities (“UCITS”) to address issues relating to the depositary function, manager remuneration and administrative sanctions.
What is a MiFID investment firm?
"Investment firm" under the Markets in Financial Instruments Directive (MiFID) means "any legal person whose regular occupation or business is the provision of one or more investment services to third parties and/or the performance of one or more investment activities on a professional basis" (Article 4(1)).
Can a MiFID firm manage an AIF?
Controlling (but not holding) client money: article 3 UK MiFID exempt firms are not permitted to hold client money in relation to UK MiFID business. ... However, a UK AIFM is not permitted to be authorised to manage an AIF on that basis (see FUND 1.4. 4 R (4)). Authorised AIF: this is an AIF which is an authorised fund.
What are MiFID investment services?
'Investment services and activities' under MiFID II mean any of the services and activities listed in Section A of Annex I to the Directive relating to any of the instruments listed in Section C of Annex I (financial instruments).
Who falls under Aifmd?
An AIFM is defined as an entity that provides, at a minimum, portfolio management and risk management services to one or more AIFs as its regular business irrespective of where the AIFs are located or what legal form the AIFM takes.
Is UK subject to Aifmd?
Overview. The UK ceased to be a member state of the European Union on 31 January 2020. ... Amongst other consequences, the UK is no longer directly subject to EU law, including AIFMD.
What is an alternative investment firm?
An alternative investment is a financial asset that does not fall into one of the conventional investment categories. ... Alternative investments include private equity or venture capital, hedge funds, managed futures, art and antiques, commodities, and derivatives contracts.