AIFMD & the Death of the traditional Hedge Fund

Save this PDF as:
 WORD  PNG  TXT  JPG

Size: px
Start display at page:

Download "AIFMD & the Death of the traditional Hedge Fund"

Transcription

1 A White Paper ` AIFMD & the Death of the traditional Hedge Fund By Shane Brett, Managing Director May

2 Contents Introduction 2 Background 2 AIFMD & the Hedge Fund Industry 3 1. Domiciliation 3 2. Reporting 3 3. Depository Requirements 4 4. Leverage 5 5. Valuation policy 5 6. Remuneration 5 Conclusion 6 Introduction So the EU has closed its doors to the US hedge fund industry. Financial Times, Oct 2011 Make no mistake the AIFM directive is going to change the Hedge Fund industry forever. This legislation (now in advanced draft form) effectively marks the end of the free-wheeling unregulated years of the Hedge Fund. A new era of regulation is upon us and the consequences of this EU Directive means the traditional, secretive Hedge Fund model is effectively dead. Background Rightly or wrongly Hedge Funds in mainland Europe have an unenviable reputation. Despite no Hedge Fund ever having required a public bailout, the EU has used the current economic crisis as a pre-text to increase regulation across the industry in Europe. Across the industry focus to date has been on Dodd Frank (especially in the US) but the Alternative Investment Fund Managers Directive (AIFMD) is likely to have far greater affects on the wider Hedge Fund Industry in the years to come. The third and final draft version of the AIFM Directive was published recently (May 2012) and unsurprisingly, against a background of extreme Euro Zone turbulence, they have reintroduced many of the more prohibitive requirements that were first seen in the original draft but had been successfully lobbied down in the second version. Incredibly, this final version has even been criticised by such unlikely sources as ESMA (the EU s own super regulator) and the ECB but still looks likely to become law across the EU in July We believe the adoption of AIFMD signals the death of the traditional largely unregulated

3 alternative investment black-box which pre-dominated the industry for so long. Instead we are moving towards a more standard and invasive model of financial regulation, similar to the UCITS regime in Europe. This means Hedge Funds will be trying to implement the required operational reforms (including around leverage, reporting and depository liability) while the outcome of the on-going Euro Zone saga is being played out in the background. It will make for a challenging environment to try and implement substantial regulatory change. We will look at the main changes required under AIFMD and what the likely (largely negative) effects of this will be on the Hedge Fund Industry. Likely Effects - There is a real fear that many Hedge Funds may have to re-domicile their funds within the EU in order to be able to market their products (or potentially co-domicile their funds in EU/Cayman by setting up a mirror fund inside the EU - potentially operationally tricky). Indeed some large fund of funds (like Amundi Alternative Investments) have already changed their existing structure and moved their funds fully onshore, re-domiciling within the EU regulated framework. We expect to see a lot more of this in the future. Hedge Fund friendly EU locations like Ireland (which already has nearly half the global hedge fund administration market) are pushing hard to promote themselves as an alternative domiciliation location (using their existing AIFM compliant QIF structure). AIFMD & the Hedge Fund Industry 1. Domiciliation One of the thorniest issues in the AIFMD proposals is what will happen to non-eu based managers who want to market and sell their funds inside the EU. To date the legislation has taken an inside or outside of Europe view i.e. that the Hedge Fund either operated fully within the EU or fully outside it. This view also applied to Hedge Fund investors, Managers, Custodians and the Hedge Funds themselves. Of course in reality this is nonsense. There is no such clear division. Funds (and their service providers) operate across multiple jurisdictions just like companies in other global industries. 2. Reporting Like Dodd Frank in the US, AIFMD massively increases the level of record-keeping reporting required by Hedge Fund Managers. Managers will have to register with their national regulator (essentially the FSA in the UK (itself changing shortly) given that 80% of EU based Hedge Funds are in London). Details will be required of investment strategy, the main instruments funds will be trading and what the likely level of exposure will be. Similar reporting will be required on a frequent on-going basis in relation to its exposure and risk calculations. The stated aim of this is to allow the regulators to determine if a systemic threat is building up in the financial system. Likely Effects Hedge Funds will have to invest heavily in their operational software in order to be able to access large volumes of data quickly and flexibly for reporting purposes. This 3

4 will obviously favour larger, more established managers who should have deeper pockets. It will also favour larger Administrators. As they are holding the official books and records of the fund and can easily access and report this data, many Managers may decide to fully outsource the AIFMD reporting requirements to them. Administrators themselves will likely have to invest in their existing reporting capabilities in order to satisfy their clients. Smaller administrators will find this more difficult, reinforcing the process of consolidation already underway in this part of the industry. Additionally these reporting requirements will feed down pressure to the industries main software vendors; to make their software more malleable and dynamic for reporting purposes, right across all aspects of the fund. There is likely to be a year or two lag once the Directive is finalised, while many vendors built out the required enhancements in their applications Hedge Funds using proprietary software will likely have to make substantial investments to bring their systems up to the new required standard. They may decide the gap is not worth trying to bridge and opt to migrate to an off-theshelf platform which will do this for them. 3. Depository Requirements All Alternative Investment Funds will have to appoint a single independent Depository to safeguard the fund s assets. Under the AIFMD proposed regulations Depositories (Custodians/Prime Brokers) will have a much higher degree of liability for any losses that are incurred even losses that are outside of their control (i.e. delegated to a third party). In many ways this regime will be even tighter than the existing UCITS requirements. This is a huge change whereby hedge funds are effectively more tightly regulated than the existed onshore regime. Non-EU funds must have a Depository either within the EU or in their home country (main location) or country of domiciliation. However the catch here is that non-eu Depository must be subject to the same level of EU regulation in the home jurisdiction as they would be in the EU (including mutual tax and regulatory cooperation agreements). It is completely unclear how this will work in practice and is a source of much concern in the industry. Our view is that this requirement is close to unworkable. Likely Effects We would expect to see some depositories withdraw completely from perceived risky markets. Additionally we would also expect to see them offer less coverage for markets which they deem are in any way inherently risky. Many existing Depositories will be reluctant to continue to offer coverage in certain Emerging Markets. This could have a huge effect on these countries. If Hedge Funds are effectively unable to allocate their investment capital to the assets in these countries, it serves to undermine investment in the markets that most need it. Non-EU funds will have to spend the next couple of years (the Directive becomes law in July 2013) working with their national regulator to ensure that their home regulations satisfy the Directive s requirements. The real issue will be when the gaps are identified. 4

5 The Directive is mandating that the home regulator must itself introduce regulation to bring itself up to the EU level. This, of course, will be close to impossible politically. The EU will be seen as trying to supplant other countries sovereignty. We expect many countries (including the US) to lodge official objections to these rules (perhaps at the WTO level) and if this is not resolved satisfactorily, then reciprocal rules will be imposed on EU resident Hedge Funds. 4. Leverage As well as stricter rules on the use of leverage, the current draft proposals contain an unusual and very strict methodology for calculating leverage. This proposal has raised many eyebrows right across the industry. The EU actually rejected the more common leverage methodology recommended by ESMA (its own markets regulator). Likely Effect If this calculation is adopted it will further limit the amount of leverage a Hedge Fund can adopt in its investment strategy and could be a major change from the model of the traditional hedge fund. Furthermore adopting these new calculations will be an operational nightmare for smaller firms, as they struggle to change/add existing leverage calculations to their risk analysis reporting and software. Service providers such as Administrators and the industries system vendors will have to move quickly to ensure they are compliant with these calculations if they are in the final treaty text (as currently looks likely). 5. Valuation policy AIFMD mandates that all assets of a fund will be independently valued. The valuation of the Funds assets must either be performed by an independent entity (i.e. an administrator) or they can be performed by the Hedge Fund - as long as it is not valued by the Portfolio Management function or the area that sets remuneration policy for the fund. Likely Effect - Funds will be required to use administrators (as all EU managers do now) but further restrictions on the valuation of hard to mark assets by Hedge Fund Managers may mean some may start to steer clear of potentially illiquid investments. Firms will need to document their valuation procedures, valuation committee processes and pricing policies carefully, ready for external regulatory inspection or submission. The best managers do this already, however the focus of the regulators will be squarely on the hard to value, illiquid securities which they will be concerned (in aggregate across the industry) may cause a systemic risk in the future. 6. Remuneration Under the directive company remuneration must be published in detail in the Fund Managers annual reports. Also, salaries and bonuses must be weighed towards long term rewards and away from short term payments. Likely Effect The industry will have to become use to a new level of transparency and openness in some of the most sensitive areas of any business how much its staff are remunerated. This will be a major cultural change. 5

6 Like in investment banking, Hedge Funds are likely to increase their basic salaries to staff, in order to mitigate unfavourable reporting in the press (this will be the first time mainstream media will ever have access to Hedge Fund remuneration). Conclusion It is clear from the draft AIFMD proposals that these new EU regulations will change forever the way Hedge Funds operate. offers the following services to the Asset Management industry:- The industry will have to reconcile itself to a far more open, more invasive and more regulated operating environment in Europe. This is likely to become the de-facto standard globally, bringing the era of the traditional, secretive Hedge Fund to an end. The question in the years to come is whether this is in fact only the start of a pipeline of future regulation designed to bring Alternative Investments tightly within the regulatory net. Consulting, Bespoke Research, Product Design, Service Provider Reviews Operational Due Diligence reviews. Sign up for our monthly White Papers at- ite-papers 6

November 2011. Alternative Investment Fund Managers Directive (AIFMD) Frequently Asked Questions (FAQs)

November 2011. Alternative Investment Fund Managers Directive (AIFMD) Frequently Asked Questions (FAQs) November 2011 Alternative Investment Fund Managers Directive (AIFMD) Frequently Asked Questions (FAQs) Contents Scope In a nutshell, what is the AIFMD? 3 Who is subject to the AIFMD? 3 Can an Alternative

More information

How to start a Hedge Fund

How to start a Hedge Fund How to start a Hedge Fund How to start a Hedge Fund Introduction When setting up a hedge fund, you will need to consider the following matters: Jurisdiction Fund structure Eligible investors Authorisation

More information

The Alternative Investment Fund Managers Directive Level 2 Measures published Six months to go!

The Alternative Investment Fund Managers Directive Level 2 Measures published Six months to go! The Alternative Investment Fund Managers Directive Level 2 Measures published Six months to go! 12 February 13 Introduction The Alternative Investment Fund Managers Directive ( AIFMD ) establishes a common

More information

AIFM Directive. Briefing. The impact on non-eu fund managers of non-eu funds. Introduction. Overview of the AIFMD

AIFM Directive. Briefing. The impact on non-eu fund managers of non-eu funds. Introduction. Overview of the AIFMD AIFM Directive FINANCIAL INSTITUTIONS ENERGY INFRASTRUCTURE, MINING AND COMMODITIES TRANSPORT TECHNOLOGY AND INNOVATION PHARMACEUTICALS AND LIFE SCIENCES Briefing August 2012 The impact on non-eu fund

More information

Impact on the Jersey asset management industry

Impact on the Jersey asset management industry www.pwc.com AIFMD Update Impact on the Jersey asset management industry 22 March 2012 AIFMD Setting the scene what was the purpose behind the AIFMD? Who gets caught? Impact of AIFMD Managers Service providers

More information

The Alternative Investment Fund Managers Directive ( AIFMD )

The Alternative Investment Fund Managers Directive ( AIFMD ) The Alternative Investment Fund Managers Directive ( AIFMD ) The alternative investment funds industry is shortly to be subject to European authorisation and conduct of business requirements for the first

More information

Alternative Investment Fund Managers Directive ( AIFMD ): An Overview and Analysis

Alternative Investment Fund Managers Directive ( AIFMD ): An Overview and Analysis ViewPoint May 2011 Alternative Investment Fund Managers Directive ( AIFMD ): An Overview and Analysis Introduction The Alternative Investment Fund Managers Directive ( AIFMD or Directive ) is the most

More information

AIFM DIRECTIVE: ESMA CONSULTATION PAPER

AIFM DIRECTIVE: ESMA CONSULTATION PAPER AIFM DIRECTIVE: ESMA CONSULTATION PAPER On 13th July ESMA published its consultation on the implementation measures for the Alternative Investment Fund Managers Directive (AIFMD). The AIFM Directive aims

More information

Navigating the Regulatory Maze. AIFMD Impact on Service Providers

Navigating the Regulatory Maze. AIFMD Impact on Service Providers www.pwc.com Navigating the Regulatory Maze Navigating the Regulatory Maze AIFMD Impact on Service Providers January 2011 AIFMD Impact on Service Providers The Alternative Investment Fund Managers Directive

More information

Preparing to become a Hedge Fund/Open-ended Fund AIFM. May 2013. March2013. Preparing to become an AIFM 1

Preparing to become a Hedge Fund/Open-ended Fund AIFM. May 2013. March2013. Preparing to become an AIFM 1 Preparing to become a Hedge Fund/Open-ended Fund AIFM May 2013 March2013 Preparing to become an AIFM 1 Complying with AIFMD We are pleased that the text of the implementing measures has been published.

More information

AIMA NOTE. Analysis of divergences between the EU Commission s draft regulation implementing the AIFMD and the ESMA advice

AIMA NOTE. Analysis of divergences between the EU Commission s draft regulation implementing the AIFMD and the ESMA advice AIMA NOTE Analysis of divergences between the EU Commission s draft regulation implementing the AIFMD and the ESMA advice April 2012 Analysis of divergences between the EU Commission s draft regulation

More information

BVI s position on the Consultative Document of the Basel Committee on Banking Supervision: Capital requirements for banks equity investments in funds

BVI s position on the Consultative Document of the Basel Committee on Banking Supervision: Capital requirements for banks equity investments in funds Frankfurt am Main, 4 October 2014 BVI s position on the Consultative Document of the Basel Committee on Banking Supervision: Capital requirements for banks equity investments in funds BVI 1 gladly takes

More information

Loan funds Europe s alternative source of business funding

Loan funds Europe s alternative source of business funding Loan funds Europe s alternative source of business funding Niamh Geraghty Director Audit Deloitte Matthew Foley Director Audit Deloitte Aisling Costello Senior Manager Audit Deloitte The financial crisis

More information

Disclosure and Reporting Requirements Under the Alternative Investment Fund Managers Directive

Disclosure and Reporting Requirements Under the Alternative Investment Fund Managers Directive Disclosure and Reporting Requirements Under the Alternative Investment Fund Managers Directive Edward Black, Senior Principal Consultant ACA Compliance (Europe) Limited Sally McCarthy, Senior Principal

More information

Exchange traded fund, UCITS, Alternative Investment directive, financial stability, systemic risk.

Exchange traded fund, UCITS, Alternative Investment directive, financial stability, systemic risk. The regulatory regime of Exchange traded funds in the European Union Eddy Wymeersch University of Gent Exchange traded funds have become an essential part of our financial landscape: they stand globally

More information

Policy options for implementing the Alternative Investment Fund Managers Directive

Policy options for implementing the Alternative Investment Fund Managers Directive Policy options for implementing the Alternative Investment Fund Managers Directive March 2012 Policy options for implementing the Alternative Investment Fund Managers Directive March 2012 Official versions

More information

Real Estate in Europe. Update on regulatory developments. Ad Buisman

Real Estate in Europe. Update on regulatory developments. Ad Buisman Real Estate in Europe Update on regulatory developments Ad Buisman Update on regulatory development May 22, 2012 Page 2 Key regulations that will impact the real estate funds industry Regulations that

More information

EUROPEAN CENTRAL BANK

EUROPEAN CENTRAL BANK 19.2.2013 Official Journal of the European Union C 47/1 III (Preparatory acts) EUROPEAN CENTRAL BANK OPINION OF THE EUROPEAN CENTRAL BANK of 24 May 2012 on a draft Commission delegated regulation supplementing

More information

Strategy, Marketing and Distribution AIFMD Newsbrief

Strategy, Marketing and Distribution AIFMD Newsbrief www.pwc.lu/aifm Strategy, Marketing and Distribution AIFMD Newsbrief A closer look at the impact of AIFMD on how managers market and distribute their funds April 2013 Introduction On 19 December 2012 the

More information

EU audit reform Providing nonaudit

EU audit reform Providing nonaudit www.pwc.co.uk EU audit reform Providing nonaudit services August 2014 In December 2013, the European Commission, Parliament and Council of Ministers reached political agreement on draft legislation to

More information

The Alternative Investment Fund Managers Directive a guide for US managers

The Alternative Investment Fund Managers Directive a guide for US managers Financial Services Regulation Practice Group The Alternative Investment Fund Managers Directive a guide for US managers November 15, 2013 The EU Alternative Investment Fund Managers Directive (AIFMD) has

More information

Luxembourg Life Assurance for International Investors

Luxembourg Life Assurance for International Investors Luxembourg Life Assurance for International Investors 2 3 CONTENTS 4 Luxembourg Life Assurance for International Investors 4 A truly international focus 6 Maximum protection 8 Solutions designed for sophisticated

More information

Outsourcing by UK-based Fund Managers: Identifying and Applying the Rules

Outsourcing by UK-based Fund Managers: Identifying and Applying the Rules Outsourcing by UK-based Fund Managers: Identifying and Applying the Rules Amanda Lewis, Partner and Rosali Pretorius, Partner, Dentons 1 October 2014 UK-based fund managers must comply with increasingly

More information

Fund Management Companies Guidance

Fund Management Companies Guidance 2015 Fund Management Companies - Guidance Fund Management Companies Guidance November 2015 1 Contents Part I. Delegate Oversight 2 Part II. Organisational Effectiveness 24 Part III. Directors Time Commitments

More information

Brexit assessing the impact on asset managers

Brexit assessing the impact on asset managers Asset management and funds briefing note 1 Briefing note April 2016 Brexit assessing the impact on asset managers On 23 June 2016, the UK will decide in a referendum whether to remain in or to leave the

More information

AIFMD Depositary-Lite. Overview of Requirements and Considerations for Hedge Fund Managers. 20 September 2013

AIFMD Depositary-Lite. Overview of Requirements and Considerations for Hedge Fund Managers. 20 September 2013 AIFMD Depositary-Lite Overview of Requirements and Considerations for Hedge Fund Managers 20 September 2013 1 Contents AIFMD Depositary Requirements Depositary-lite Requirements & Final UK Regulatory Position

More information

6. Supporting the financial services industry and looking to the future

6. Supporting the financial services industry and looking to the future 6. Supporting the financial services industry and looking to the future 6.1. Issues raised outside the scope of this project The NRFSB Law and FinTech / Digital Finance (DP 6.1.1 6.1.4) 6.1.1. The Commission

More information

APB ETHICAL STANDARD 5 (REVISED) NON-AUDIT SERVICES PROVIDED TO AUDITED ENTITIES

APB ETHICAL STANDARD 5 (REVISED) NON-AUDIT SERVICES PROVIDED TO AUDITED ENTITIES APB ETHICAL STANDARD 5 (REVISED) NON-AUDIT SERVICES PROVIDED TO AUDITED ENTITIES (Revised December 2010, updated December 2011) Contents paragraph Introduction 1 4 General approach to non-audit services

More information

Draft FATCA Regulations. Submission from the Association of Investment Companies

Draft FATCA Regulations. Submission from the Association of Investment Companies Draft FATCA Regulations Submission from the Association of Investment Companies Overview The Association of Investment Companies (AIC) welcomes the opportunity to comment on the draft FATCA regulations.

More information

Alternative Investment Fund Managers Directive. What does this mean for your business?

Alternative Investment Fund Managers Directive. What does this mean for your business? Alternative Investment Fund Managers Directive What does this mean for your business? Background to the Alternative Investment Fund Managers Directive (AIFMD) The Alternative Investment Fund Managers (AIFM)

More information

(Legislative acts) DIRECTIVES

(Legislative acts) DIRECTIVES 1.7.2011 Official Journal of the European Union L 174/1 I (Legislative acts) DIRECTIVES DIRECTIVE 2011/61/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 8 June 2011 on Alternative Investment Fund

More information

CAIA Ireland Educational Workshop. 9 th October 2015. Driving the Governance Agenda in Alternatives

CAIA Ireland Educational Workshop. 9 th October 2015. Driving the Governance Agenda in Alternatives CAIA Ireland Educational Workshop 9 th October 2015 Driving the Governance Agenda in Alternatives Dr Margaret Cullen CEO Certified Investment Fund Director Institute Overview 1. Agency Problem 2. Conflicts

More information

U.S. Securities and Exchange Commission

U.S. Securities and Exchange Commission U.S. Securities and Exchange Commission Annual Staff Report Relating to the Use of Data Collected from Private Fund Systemic Risk Reports This is a report of the Staff of the Division of Investment Management

More information

Convergence and the impact of AIFMD survey. www.multifonds.com

Convergence and the impact of AIFMD survey. www.multifonds.com Convergence and the impact of AIFMD survey www.multifonds.com Executive summary $16 trn total AUA, 51 survey participants The survey was carried out in June 2012 and primarily fund administrators and asset

More information

RIT Capital Partners plc Shareholder Disclosure Document January 2015

RIT Capital Partners plc Shareholder Disclosure Document January 2015 RIT Capital Partners plc Shareholder Disclosure Document January 2015 This document is intended to provide shareholders with specific information required by the FCA and ESMA in accordance with the Alternative

More information

www.davyfundservices.ie UCITS Platform

www.davyfundservices.ie UCITS Platform www.davyfundservices.ie Contents Section 1 1.1 Ireland as a Fund Domicile 1 1.2 About Davy Fund Services 1 Section 2 2.1 Why UCITS? 3 2.2 What can UCITS invest in? 4 2.3 4 2.4 Structure 5 2.5 Participating

More information

Asset management The regulatory challenges ahead

Asset management The regulatory challenges ahead Date: 05 November 2014 ESMA/2014/1333 Asset management The regulatory challenges ahead EFAMA Investment Management Forum 2014 Square Brussels Meeting Centre Steven Maijoor Chair European Securities and

More information

PROVISIONAL REQUEST TO CESR FOR TECHNICAL ADVICE

PROVISIONAL REQUEST TO CESR FOR TECHNICAL ADVICE Ref. Ares(2010)892960-02/12/2010 PROVISIONAL REQUEST TO CESR FOR TECHNICAL ADVICE ON POSSIBLE LEVEL 2 MEASURES CONCERNING THE FUTURE DIRECTIVE ON ALTERNATIVE INVESTMENT FUND MANAGERS Table of Contents

More information

OPEN-ENDED FUNDS. Guernsey your premier funds domicile BANKING MANAGEMENT

OPEN-ENDED FUNDS. Guernsey your premier funds domicile BANKING MANAGEMENT OPEN-ENDED FUNDS Guernsey your premier funds domicile INSURANCE INVESTMENT FUNDS TRUST & COMPANY PENSIONS INVESTMENT MANAGEMENT BANKING Guernsey a premier open-ended funds domicile Guernsey s open-ended

More information

MiFID II. Key interactions between MiFID/MiFIR II and other EU and US financial services legislation.

MiFID II. Key interactions between MiFID/MiFIR II and other EU and US financial services legislation. July 2012 MiFID II. Key interactions between MiFID/MiFIR II and other EU and US financial services legislation. Introduction MiFID is often described as the corner stone of financial services regulation

More information

CONSULTATION DOCUMENT REVIEW OF THE EUROPEAN VENTURE CAPITAL FUNDS (EUVECA) AND EUROPEAN SOCIAL ENTREPRENEURSHIP FUNDS (EUSEF) REGULATIONS

CONSULTATION DOCUMENT REVIEW OF THE EUROPEAN VENTURE CAPITAL FUNDS (EUVECA) AND EUROPEAN SOCIAL ENTREPRENEURSHIP FUNDS (EUSEF) REGULATIONS EUROPEAN COMMISSION Directorate-General for Financial Stability, Financial Services and Capital Markets Union FINANCIAL MARKETS Asset management CONSULTATION DOCUMENT REVIEW OF THE EUROPEAN VENTURE CAPITAL

More information

PHOTO. for alternative investments

PHOTO. for alternative investments PHOTO αsuite for alternative investments Understanding the challenges The alternative investment industry is developing at an ever increasing rate with new markets and vehicles, as trading strategies and

More information

Risk management within AIFMD for private equity and real estate funds. Sylvain Crépin Senior Manager Capital Markets/Financial Risk Deloitte

Risk management within AIFMD for private equity and real estate funds. Sylvain Crépin Senior Manager Capital Markets/Financial Risk Deloitte Risk management within AIFMD for private equity and real estate funds Xavier Zaegel Partner Capital Markets/Financial Risk Deloitte Sylvain Crépin Senior Manager Capital Markets/Financial Risk Deloitte

More information

MiFID II/MiFIR. Implications for Fund Managers. May 2014. 2014 Deloitte LLP. All rights reserved.

MiFID II/MiFIR. Implications for Fund Managers. May 2014. 2014 Deloitte LLP. All rights reserved. /MiFIR Implications for Fund Managers May 2014 Webinar participants Manmeet Rana Senior Manager Audit Deloitte UK mrana@deloitte.co.uk +44 20 7303 8624 Manmeet Rana is a Senior Manager within Deloitte

More information

GUIDELINE ON THE APPLICATION OF THE OUTSOURCING REQUIREMENTS UNDER THE FSA RULES IMPLEMENTING MIFID AND THE CRD IN THE UK

GUIDELINE ON THE APPLICATION OF THE OUTSOURCING REQUIREMENTS UNDER THE FSA RULES IMPLEMENTING MIFID AND THE CRD IN THE UK GUIDELINE ON THE APPLICATION OF THE OUTSOURCING REQUIREMENTS UNDER THE FSA RULES IMPLEMENTING MIFID AND THE CRD IN THE UK This Guideline does not purport to be a definitive guide, but is instead a non-exhaustive

More information

Table of content. MiFID II: getting ready for implementation

Table of content. MiFID II: getting ready for implementation Table of content MiFID II: getting ready for implementation The European Council adopted a set of legislation on 13 May 2014 regulating the trade in financial instruments and the investment services sector.

More information

NEW ALTERNATIVE INVESTMENT VEHICLES RISING

NEW ALTERNATIVE INVESTMENT VEHICLES RISING NEW ALTERNATIVE INVESTMENT VEHICLES RISING Niamh Gaffney Senior Manager Tax and Legal Deloitte David Capocci Partner Tax Deloitte Benjamin Toussaint Director Tax Deloitte The alternative investment fund

More information

How to Run Offshore Management Companies and Funds with Substance and Corporate Governance

How to Run Offshore Management Companies and Funds with Substance and Corporate Governance White Paper Series: How to Run Offshore Management Companies and Funds with Substance and Corporate Governance This white paper series by Laven Financial Services discusses how hedge fund businesses should

More information

This is a guide to how funds and managed accounts work, how they are regulated and the pros and cons of each.

This is a guide to how funds and managed accounts work, how they are regulated and the pros and cons of each. GUIDE TO FUNDS AND MANAGED ACCOUNTS This is a guide to how funds and managed accounts work, how they are regulated and the pros and cons of each. Glossary These are some of the common words used in this

More information

master-feeder structures: made in luxembourg UCITS IV

master-feeder structures: made in luxembourg UCITS IV master-feeder structures: made in luxembourg UCITS IV What is a master-feeder structure? One of the main features of the UCITS IV Directive is the master-feeder structure, which provides for pooling of

More information

SETTING UP IN LUXEMBOURG ASSET MANAGEMENT COMPANY FUND VEHICLE CONTRACTS DERIVATIVES & SECURITIES OPERATIONS

SETTING UP IN LUXEMBOURG ASSET MANAGEMENT COMPANY FUND VEHICLE CONTRACTS DERIVATIVES & SECURITIES OPERATIONS SETTING UP IN LUXEMBOURG ASSET MANAGEMENT COMPANY FUND VEHICLE CONTRACTS DERIVATIVES & SECURITIES OPERATIONS SETTING UP IN LUXEMBOURG JURISCONSUL assists its clients in the setting-up of hedge funds in

More information

Hedge Funds Facing new challenges

Hedge Funds Facing new challenges Hedge Funds Facing new challenges IN ASSOCIATION WITH WHITE PAPER SERIES Hedge Funds Facing new challenges The global financial markets are on the threshold of a new regulatory era. Technology will undoubtedly

More information

www.carnegroup.com AIFMD Guide for Asset Managers Knowledge Expertise Experience By Carne - the AIFMD experts

www.carnegroup.com AIFMD Guide for Asset Managers Knowledge Expertise Experience By Carne - the AIFMD experts www.carnegroup.com AIFMD Guide for Asset Managers Knowledge By Carne - the AIFMD experts Expertise Experience 1 2 www.carnegroup.com www.carnegroup.com Contents Page 1 Preface 3 2 Overview of the AIFM

More information

Is your prime broker or administrator the biggest threat to the success of your business?

Is your prime broker or administrator the biggest threat to the success of your business? Is your prime broker or administrator the biggest threat to the success of your business? Managers have become so wearily familiar with completing and issuing due diligence questionnaires that there is

More information

UCITS IV: Management Companies, and passports. February 2011

UCITS IV: Management Companies, and passports. February 2011 February 2011 This briefing paper sets out the new provisions which will apply to UCITS Management Companies, explains how the passport is now designed to work, and summarises the changes made to the long

More information

Please find below our responses to the questions raised in the consultation document.

Please find below our responses to the questions raised in the consultation document. 9 May 2014 To: Unit G3 Securities Markets DG Internal Market and Services European Commission Via e-mail to MARKT-G3@ec.europa.eu Re: Consultation Document FX Financial Instruments Dear Sir, Dear Madam,

More information

INVESTMENT POLICY April 2013

INVESTMENT POLICY April 2013 Policy approved at 22 April 2013 meeting of the Board of Governors (Minute 133:4:13) INVESTMENT POLICY April 2013 Contents SECTION 1. OVERVIEW SECTION 2. INVESTMENT PHILOSOPHY- MAXIMISING RETURN SECTION

More information

1. HISTORY OF SWISS HEDGE FUNDS

1. HISTORY OF SWISS HEDGE FUNDS Switzerland Froriep Renggli Catrina Luchsinger Gaehwiler, Raffaele Rossetti & Michael Fischer 1. HISTORY OF SWISS HEDGE FUNDS 1.1 Facts and figures Switzerland has historically always been considered an

More information

Hedge funds: Improving disclosure

Hedge funds: Improving disclosure REGULATORY GUIDE 240 Hedge funds: Improving disclosure October 2013 About this guide This guide is for those involved in the issue and sale of hedge funds. It sets out our guidance for improved disclosure

More information

Things to Consider When Establishing Your Irish Fund Structure

Things to Consider When Establishing Your Irish Fund Structure Things to Consider When Establishing Your Irish Fund Structure Before establishing your fund in Ireland, there are a number of steps to consider which are primarily driven by the fund structure selected.

More information

Davy Fund Services

Davy Fund Services www.davyfundservices.ie Contents Section 1 About 1 Section 2 2.1 Investment Management Services 2 2.2 Management Company Services 2 2.3 Distribution Services 2 2.4 Funds Listing 3 2.5 The Davy UCITS Platform

More information

HOW TO SET UP A GIBRALTAR EXPERIENCED INVESTOR FUND

HOW TO SET UP A GIBRALTAR EXPERIENCED INVESTOR FUND HOW TO SET UP A GIBRALTAR EXPERIENCED INVESTOR FUND [2 nd Edition, June 2013] When taking the decision to establish an Experienced Investor Fund ( EIF ) in Gibraltar, various matters require consideration.

More information

A Guide to Investment Funds in Ireland

A Guide to Investment Funds in Ireland A The firm is flexible, responsive, business like and highly commercial. Chambers Global INTRODUCTION We have prepared this guide for the benefit of fund promoters and professional advisers who may be

More information

Impact of Regulations and Risk Management in Financial Markets in Europe

Impact of Regulations and Risk Management in Financial Markets in Europe SALES OPPORTUNITY ASSESSMENT PRODUCT CATI EMERGING MARKET ENTRY STRATEGY CUSTOMER INTELLIGENCE MARKET SIZING AND FORECASTING INDUSTRY BEST PRACTICE CUSTOMER NEED BEST PRACTICE ASSESSMENT COMPETITIVE INTELLIGENCE

More information

Risk mitigation requirements for daily valuation a. The use of the term outstanding contracts under Article 11(2) of EMIR;

Risk mitigation requirements for daily valuation a. The use of the term outstanding contracts under Article 11(2) of EMIR; The European Securities and Markets Association (ESMA) 103 Rue de Grenelle Paris 75007 France Attention: Rodrigo Buenaventura/Fabrizio Planta 12 March 2013 Dear Sirs, The Alternative Investment Management

More information

The Universal Management Company

The Universal Management Company The Universal Management Company Jean Devambez, BNP Paribas Securities Services Claude Niedner, Arendt & Medernach Christopher Stuart-Sinclair, Deloitte 25 October 2013 The Universal Man Co: combine your

More information

UKSIF response to The Social Business Initiative: Promoting Social Investment Funds

UKSIF response to The Social Business Initiative: Promoting Social Investment Funds Register id: 59426296269-17 14 September 2011 Directorate General Internal Market and Services European Commission 1049 Brussels, Belgium Email: markt-social-investment@ec.europa.eu UKSIF response to The

More information

Response to European Commission Consultation Document on Undertakings for Collective Investment in Transferable Securities ( UCITS )

Response to European Commission Consultation Document on Undertakings for Collective Investment in Transferable Securities ( UCITS ) Association for Financial Markets in Europe Response to European Commission Consultation Document on Undertakings for Collective Investment in Transferable Securities ( UCITS ) 24 October 2012 The Association

More information

Questions and Answers Application of the AIFMD

Questions and Answers Application of the AIFMD Questions and Answers Application of the AIFMD 03.06.2016 ESMA/2016/909 Date: 3 June 2016 ESMA/2016/909 Contents Section I: Remuneration 5 Section II: Notifications of AIFs 7 Section III: Reporting to

More information

10 minutes on... post FOFA rewards

10 minutes on... post FOFA rewards September 2012 What you need to know about emerging topics essential to your business. 10 minutes on... post FOFA rewards Brought to you by PwC. Highlights With the FOFA deadline looming and ASIC regulatory

More information

Third-party Management Companies A new governance model?

Third-party Management Companies A new governance model? Third-party Management Companies A new governance model? William Jones Founder and Senior Partner ManagementPlus Group The third-party management company is a familiar concept originating with UCITS. It

More information

The directive on alternative investment fund managers

The directive on alternative investment fund managers The directive on alternative investment fund managers financial institutions ENERGY infrastructure AND COMMODITIES Transport technology Briefing December 2010 Summary With the approval of the EU Parliament

More information

Review of Consultation Paper CP86 Consultation on Fund Management Company Effectiveness Delegate Oversight

Review of Consultation Paper CP86 Consultation on Fund Management Company Effectiveness Delegate Oversight Review of Consultation Paper CP86 Consultation on Fund Management Company Effectiveness Delegate Oversight The Central Bank of Ireland ( CBI ) issued a Consultation Paper on 19 September 2014 titled Fund

More information

Important Information about a Fund of Hedge Funds

Important Information about a Fund of Hedge Funds Robert W. Baird & Co. Incorporated Important Information about a Fund of Hedge Funds Fund of Hedge Fund Investing at Baird Baird offers eligible clients the opportunity to invest in funds of hedge funds

More information

New Risk Management Paradigms for Asset Managers

New Risk Management Paradigms for Asset Managers April 2014 Asset Management New Management Paradigms for Asset Managers Point of view The financial crisis has caused deep reflection by regulators, asset managers and investors as to the effectiveness

More information

MiFID II, Research Unbundling, and What it Means for You

MiFID II, Research Unbundling, and What it Means for You AUTHORS Jack Pollina Managing Director Head of Global Commission Management and Hedge Fund Business Development jack.pollina@itg.com CONTACT Asia Pacific +852.2846.3500 Canada +1.416.874.0900 EMEA +44.20.7670.4000

More information

COMMISSION STAFF WORKING DOCUMENT SUMMARY OF THE IMPACT ASSESSMENT. Accompanying the document

COMMISSION STAFF WORKING DOCUMENT SUMMARY OF THE IMPACT ASSESSMENT. Accompanying the document EUROPEAN COMMISSION Brussels, 7.3.2012 SWD(2012) 23 final COMMISSION STAFF WORKING DOCUMENT SUMMARY OF THE IMPACT ASSESSMENT Accompanying the document Proposal for a Regulation of the European Parliament

More information

The Fintech and Payments Revolution of PSD2: What do I need to know?

The Fintech and Payments Revolution of PSD2: What do I need to know? Financial Regulation Group Focus April 2016 The Fintech and Payments Revolution of PSD2: What do I need to know? Technology and competition are revolutionising the provision of payment services. Long established

More information

Risk Management under the Alternative Investment Fund Managers Directive ( AIFMD )

Risk Management under the Alternative Investment Fund Managers Directive ( AIFMD ) guidelines Risk Management under the Alternative Investment Fund Managers Directive ( AIFMD ) in association with table of contents I. Introduction 4 General Aspects of Risk Management Function for an

More information

Infrastructure: From Cost to Benefit Hedge Funds 2.0

Infrastructure: From Cost to Benefit Hedge Funds 2.0 www.pwc.com/assetmanagement Infrastructure: From Cost to Benefit Hedge Funds 2.0 Preparing the next generation of hedge funds for growth. Contents Executive summary 2 Why stronger infrastructure matters

More information

Nollaig Greene, Elaine Keane, Darragh Noone & Peter Maher A&L Goodbody Solicitors

Nollaig Greene, Elaine Keane, Darragh Noone & Peter Maher A&L Goodbody Solicitors Ireland Nollaig Greene, Elaine Keane, Darragh Noone & Peter Maher A&L Goodbody Solicitors 1. MARKET OVERVIEW The Irish investment funds market is founded on Ireland s position as a leading global centre

More information

INSURANCE ACCOUNTING MIND THE UK GAAP

INSURANCE ACCOUNTING MIND THE UK GAAP INSURANCE ACCOUNTING MIND THE UK GAAP This is a paper prepared by the staff of the UK Accounting Standards Board in order to invite comments from constituents on the options for the future of insurance

More information

A Guide to the QFC. Collective Investment Schemes Regime

A Guide to the QFC. Collective Investment Schemes Regime A Guide to the QFC Collective Investment Schemes Regime Disclaimer The goal of the Qatar Financial Centre Regulatory Authority (Regulatory Authority) in producing this document is to provide a guide to

More information

AIFMD INFORMATION BROCHURE. 9 September 2014

AIFMD INFORMATION BROCHURE. 9 September 2014 FUND: ishares MSCI Emerging Markets ETF (the ) INVESTMENT ADVISER: BlackRock Advisors (the AIFM ) AIFMD INFORMATION BROCHURE 9 September 2014 Provision of the Swedish Act (Sw. lag (2013:561) om förvaltare

More information

Sound Practice Guidelines for Administrators of Alternative Funds including Experienced Investor Funds in the Isle of Man

Sound Practice Guidelines for Administrators of Alternative Funds including Experienced Investor Funds in the Isle of Man Sound Practice Guidelines for Administrators of Alternative Funds including Experienced Investor Funds in the Isle of Man The Isle of Man Fund Management Association acts as a representative body for the

More information

List of provisions for consumer protection

List of provisions for consumer protection List of provisions for consumer protection Type of provision Lending platforms Equity and/or Debt platforms Maximum amount of investment for 40.000 Euro 20.000 Euro consumers on the platform Maximum frequency

More information

Ireland. Country Q&A Ireland. Benedicte O Connor and Brian Dillon Dillon Eustace. Country Q&A. Retail funds. Open-ended retail funds

Ireland. Country Q&A Ireland. Benedicte O Connor and Brian Dillon Dillon Eustace. Country Q&A. Retail funds. Open-ended retail funds Investment Funds 2010 Ireland Ireland Benedicte O Connor and Brian Dillon Dillon Eustace www.practicallaw.com/7-501-5093 Retail funds 1. Please give a brief overview of the retail funds market in your

More information

Financial Services and Markets

Financial Services and Markets Financial Services and Markets "Telephone taping": removal of the mobile phone exemption Despite strong objections from the industry, the FSA has confirmed that the so-called mobile phone exemption is

More information

THE UH OH MOMENT. Financial Services Enterprises Focus on Governance, Transparency and Supply Chain Risk

THE UH OH MOMENT. Financial Services Enterprises Focus on Governance, Transparency and Supply Chain Risk THE UH OH MOMENT Financial Services Enterprises Focus on Governance, Transparency and Supply Chain Risk By Lois Coatney, Chuck Walker and Joseph Yacura, ISG Directors www.isg-one.com INTRODUCTION A top

More information

UNDERSTANDING LIQUIDITY FEES AND REDEMPTION GATES

UNDERSTANDING LIQUIDITY FEES AND REDEMPTION GATES UNDERSTANDING LIQUIDITY FEES AND REDEMPTION GATES Over a series of upcoming papers we aim to help money market fund investors understand and assess money market fund rules by exploring the impact of the

More information

ALTERNATIVE INVESTMENT FUND MANAGERS DIRECTIVE INSTRUMENT 2013

ALTERNATIVE INVESTMENT FUND MANAGERS DIRECTIVE INSTRUMENT 2013 ALTERNATIVE INVESTMENT FUND MANAGERS DIRECTIVE INSTRUMENT 2013 Powers exercised by the Financial Conduct Authority A. The Financial Conduct Authority makes this instrument in the exercise of the following

More information

Centralised Portfolio Management

Centralised Portfolio Management Centralised Portfolio Management Introduction In our previous paper (Centralised Portfolio Management, December 2014) we highlighted the importance of improving investment outcomes for members by considering

More information

Public consultation on the possibility for an investment fund to originate loans

Public consultation on the possibility for an investment fund to originate loans Public consultation on the possibility for an investment fund to originate loans The purpose of this consultation is to gather the opinions of all interested parties about the possibility for French investment

More information

PRIVATE CLIENT BRIEFING:

PRIVATE CLIENT BRIEFING: PRIVATE CLIENT BRIEFING: I M A US CITIZEN RESIDENT IN THE UK, WHAT DO I NEED TO KNOW? JANUARY 2013 Almost uniquely, the US taxes its citizens (and Green Card holders) on a worldwide basis regardless of

More information

Exchange Traded Funds

Exchange Traded Funds Exchange Traded Funds Simple products. Sophisticated strategies. ETFs Exchange Traded Funds (ETFs) are essentially straightforward index-tracking instruments but in the hands of a skilful professional

More information

ESMA issues technical advice to the EU Commission on (i) insolvency protection when delegating safekeeping functions and (ii) depositary independence

ESMA issues technical advice to the EU Commission on (i) insolvency protection when delegating safekeeping functions and (ii) depositary independence December 2014 ESMA issues technical advice to the EU Commission on insolvency protection when delegating safekeeping functions and depositary independence For further information on any of the issues discussed

More information

CYPRUS: SOLUTIONS IN A CHANGING INVESTMENT FUND INDUSTRY 4

CYPRUS: SOLUTIONS IN A CHANGING INVESTMENT FUND INDUSTRY 4 C Y P R U S FO R F U N D S C O N T E N T S CYPRUS: SOLUTIONS IN A CHANGING INVESTMENT FUND INDUSTRY 4 CYPRUS: THE LOCATION OF CHOICE FOR THE DOMICILIATION AND ADMINISTRATION OF INVESTMENT FUNDS (UCITS

More information

AUDITORS LIABILITY AND ITS IMPACT ON THE EUROPEAN CAPITAL MARKETS ABI RESPONSE TO EUROPEAN COMMISSION DG INTERNAL MARKET CONSULTATION PAPER

AUDITORS LIABILITY AND ITS IMPACT ON THE EUROPEAN CAPITAL MARKETS ABI RESPONSE TO EUROPEAN COMMISSION DG INTERNAL MARKET CONSULTATION PAPER AUDITORS LIABILITY AND ITS IMPACT ON THE EUROPEAN CAPITAL MARKETS ABI RESPONSE TO EUROPEAN COMMISSION DG INTERNAL MARKET CONSULTATION PAPER INTRODUCTION In January 2007 the EU Commission published a consultation

More information

EBA FINAL draft Regulatory Technical Standards

EBA FINAL draft Regulatory Technical Standards EBA FINAL DRAFT RTS ON OWN FUNDS REQUIREMENTS FOR INVESTMENT FIRMS BASED ON EBA/RTS/2014/01 29 January 2014 EBA FINAL draft Regulatory Technical Standards on own funds requirements for investment firms

More information

White Paper AIFMD: Hedge

White Paper AIFMD: Hedge HEDGE360 Defining Hedge Fund Management White Paper AIFMD: Hedge Funds Take Stock A Hedge360 White Paper Contents 1 Reporting Requirements 2 AIFMD Authorization/Marketing Rules 2 Depositary Assignments

More information