ESMA on the AIFMD passporting regime in regards to non-EU AIFMS AND AIFS

In a speech held on 13 October 2015 Steven Maijoor, the Chair of
the
European Securities and Markets Authority (“ESMA”), discussed ESMA’s work in relation to the passport under the Alternative Investment Fund Managers Directive (“AIFMD”) in front of the European Parliament’s ECOFIN committee. Some of the key issues covered in Mr Maijoor’s speech included the functioning of the EU passport and the national private placement regimes (“NPPR”), and the the possible extension of the passport to non-EU countries.

One of the key points of Mr Maijoor’s speech was in regards to ESMA’s recommendation of extending the current AIFMD passport to Jersey, Guernsey and Switzerland but not the United States, Singapore and Hong Kong. However, it was noted that the EU institutions may wish to consider waiting until ESMA has delivered positive advice on a larger number of non-EU countries before triggering the relevant legislative procedures, taking into account such factors as the potential impact on the market that a decision to extend the passport might have. Furthermore, Mr Maijoor indicated three key areas of work were ESMA will seek to focus on in the short term. Namely, a continued assessment of Hong Kong, Singapore and the US in regards to reaching a definitive conclusion on whether the passport should be extended to these jurisdictions. Given the size of the economies of the three countries this would have a significant impact on EU investment firms in respect of the marketing of their funds cross-border and gathering investments.

A further point which was discussed in the speech is the current divergence in fund marketing rules between EU member states, which is something ESMA seeks to evaluate and address with the view of promoting a common approach. A more harmonised EU marketing environment would lead to an overall smoother placement regime throughout member states and hence an easier movement of and access to capital.

Firms should keep track of the upcoming developments to AIFMD’s passporting regime and marketing rules. Should the suggested harmonisation and extension be implemented, this would be good news for the industry as a whole.

In order to view the full speech by Steven Maijoor from 13 October 2015 please follow this link.

Should you require any further advice or information on the above, Cleveland & Co, your external in-house counsel, are here to help.

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