Sat, Oct 10, 2015
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


What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
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. U.S. hedge funds prepare for worst finish this year since 2008[more]

    Komfie Manalo, Opalesque Asia: U.S.-focused hedge funds are preparing for their worst year since the 2008 global financial crisis, following a series of letdown including the market sell-off in August and the sell-off in healthcare and biotechnology sectors last month, reported

  2. Investing - AQR Capital and Renaissance Technologies raise stakes in Southwest Airlines[more]

    From In the previous part of this series, we saw how institutional investors played Southwest Airlines (LUV) in 2Q15. Now let’s move on to the trades executed by key hedge funds in Southwest Airlines over the same period. … Most of the hedge funds that had significant exposu

  3. Manager Profile - Pimco alternative funds flourish as 30-year bond rally fades[more]

    From Inside Pacific Investment Management Co., the bond behemoth that lost two chief investment officers last year and saw almost $500 billion of client money leave, a hidden profit engine is easing some of the pain. For more than a decade, Newport Beach, California-based Pimco has qu

  4. Niche Investing - Art investment funds: Attracting institutional and other new investors[more]

    From The Deloitte/ArtTactic Art and Finance Report 2014 (the "Art and Finance Report") noted that the "global art investment fund market was estimated to be worth at least $1.26 billion in the first half of 2014." This seems almost inconsequential when juxtaposed with the $54 billion of

  5. DoubleLine’s Jeffrey Gundlach warns of another round of market shakedown[more]

    Komfie Manalo, Opalesque Asia: DoubleLine Capital co-founder Jeffrey Gundlach is painting a bleak future as he warned that the U.S. equity market and other risk markets, such as high-yield "junk" bonds, are facing another round of selling pressure. Gundlach said in an interview with