Thu, Apr 17, 2014
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Cerulli claims regulators risk 'ensnaring unintended victims' with AIFMD

Tuesday, March 05, 2013
Opalesque Industry Update - New research from Cerulli Associates. finds that national differences are appearing as the deadline for the AIFMD approaches.

National regulators risk ensnaring unintended victims as they transpose the Alternative Investment Fund Managers Directive (AIFMD), according to The Cerulli Edge-Global Edition, March 2013 Issue. Domestic flexibility in adopting the directive is throwing the industry a multitude of curve balls. Spanish guaranteed funds may face a life-threatening retail market ban if national financial regulator CNMV gets transposition wrong. German open-ended property funds, which were never in the directive's sights, could also be hit. Managers are adopting a wait-and-see approach.

Meanwhile, alternatives managers across the Channel fear a cross-border marketing black hole over authorization delays. "Although U.K. alternative investment funds (AIFs) will have one year's grace to get their authorization after the implementation deadline of July 22, 2013, the Financial Services Authority will not be accepting applications any time soon," said Barbara Wall, a director at Cerulli Associates. "With non-authorized private placements choked off in Germany and possibly other EU domiciles, United Kingdom-domiciled AIFs will have to abandon their cross-border money raising efforts until their passports arrive in the post."

Non-EU managers face even greater uncertainty. The directive does allow these managers to continue distributing their non-EU alternative investment funds, so long as they adhere to national private placement regimes. But the fact it also requires a formal cooperation agreement between the regulator of the fund's home jurisdiction and the EU country into which the fund is to be distributed is raising some concerns.

Yoon Ng, a Cerulli associate director, commented, "Only Switzerland and Brazil have so far established cooperation agreements. The jury is still out on whether there will be an exodus of Swiss hedge fund managers to EU jurisdictions, but feedback from local fund groups indicates that the Swiss regulator has probably done enough to ensure Switzerland retains its appeal as a hedge funds center."

The United States is currently in negotiation with the EU, but it remains to be seen whether cooperation agreements will be in place for July. U.S. managers appear to be in the dark about the work required to ready themselves for the new regime. They need to act now as the penalty for non-compliance with the directive is likely to be severe.

Press release

bc

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Banner
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing
  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Opalesque Exclusive: European stock-picking fund up 19% YTD, bets on small caps’ high cash level[more]

    Benedicte Gravrand, Opalesque Geneva for New Managers: Here is a European long/short equity fund that has been beating the odds since its 2008 inception by employing its own investment model, frequent company visits

  2. CTAs could face new challenges in a rising rates environment[more]

    Bailey McCann, Opalesque New York: CTAs have taken a beating performance wise lately, and asset flows reports show that investors aren't sticking around to see how the movie ends. Now, a new white paper from Roy Niederhoffer and Coen Weddepohl notes that as interest rates start to tick back u

  3. Investing – Big hedge funds bought Puerto Rico's junk bonds, Fidelity explores new trading venue amid flash trade concerns, Crisis-era Greek bonds reward early buyers with big effective returns, Cargill unit discloses stake in Freddie preferred[more]

    Big hedge funds bought Puerto Rico's junk bonds From Reuters.com: Several large hedge funds doubled down on Puerto Rico in last month's giant bond sale despite the U.S. territory's financial struggles, the Wall Street Journal reported, citing confidential documents reviewed by the newspa

  4. Opalesque TV: First Trust Advisors launches liquid alternatives platform[more]

    Bailey McCann, Opalesque New York: First Trust Advisors is launching a new liquid alternatives platform aimed at building on the companies existing alternative ETFs offering by adding hedged mutual funds. Senior Portfolio Managers Rob Guttschow and John Gambla recently sat down in an

  5. Commodities – Popular value fund manager David Iben bets on Russia, gold,[more]

    From Reuters.com: With large bets on Russia and North American gold miners, one of the best performing stock pickers in the wake of the 2008 financial crisis is back with a new fund that reflects his deep aversion to following the crowd. In the Kopernik Global All-Cap Fund, David Iben is follo