National Private Placement Regimes
National Private Placement Regimes principally relates to the marketing of non-EEA AIFs and AIFs managed by non-EEA AIFMs. As AIFMD has been implemented in each EU member state there have invariably been differences in approach to certain areas.
The fund registration process therefore varies from country to country and must be considered on an individual basis when making applications to ensure that all the requirements of each member state are met.
Reverse solicitation, or passive marketing, which is marketing that is not at the direct or indirect initiative of the non-EEA fund manager is still permitted under the AIFMD. For example if an investor approaches the manager about investing in a fund without prior solicitation, then on that basis the manager should not need to comply with the AIFMD as such marketing would not be at the initiative of the manager.
There is no firm guidance as to what constitutes reverse solicitation and a manager intending to rely on reverse solicitation will need to ensure that procedures and policies are put in place to clearly demonstrate that a particular EU investor invested in the fund on this basis. It will also need to ensure that follow up communications with such an investor do not inadvertently result in active marketing, for example, of another fund. If a manager is unwilling to rely on reverse solicitation, then the only alternative at present for such managers is to market in accordance with existing private placement regimes.
Marketing between 2015 and 2018
Although the private placement regime is at the time of writing in August 2018 still in place, not all EEA countries may retain the regime if the EEA passport is introduced following decisions from ESMA and the European Commission.
Marketing after 2018
The private placement regime is still in place (August 2018), but ESMA is expected to report at some point in the future on whether this regime should stay or be abolished. If it is abolished, all non-EEA Managers who wish to continue marketing their funds in the EEA will need to apply for authorisation to a “regulator of reference” and comply fully with the AIFMD.
Under AIFMD more institutional investors are looking for asset managers to comply with the AIFMD when they are making investments into alternatives either because of their own regulatory considerations or because, as a fiduciary investor, they want to avail of the investor protections built into the AIFMD.
AIFMD - Compliance Options Summary
|1||Appoint an Authorised AIFM||Yes|
|2||Appoint a Sub Threshold or "Registered AIFM"||No|
|3||Designate a non-EEA AIFM||No|
|4||Set up an EEA AIFM||Yes|
|5||Partner with a Third Party AIFM||Yes|