The AIFM Directive’s final furlong

On 11 November the European Parliament adopted the Alternative Investment Fund Managers Directive (AIFMD), ending almost 18 months of uncertainty about the content of this legislation. Charlotte Hill looks at the progress of the directive so far and considers the details of its final form.

Charlotte Hill (charlotte.hill@shlegal.com) is a partner and head of the financial services and regulation practice at Stephenson Harwood. She has recently published ‘A Practitioner’s Guide to Authorised Investment Funds’. Charlotte would like to thank Alexander Anderson, paralegal, for his assistance with this article.

Financial crisis as catalyst

Within the EU, investment funds fall into two categories depending on whether or not they comply with the harmonised rules laid down in the UCITS (Undertakings for Collective Investment in Transferable Securities) Directive (85/611/EEC). Those funds that comply with the UCITS Directive are usually described as UCITS funds and are authorised for sale to the retail market, while the remainder are known as non-UCITS (or non-harmonised) funds. The AIFM Directive is concerned with this second group, identifying alternative investment funds (AIFs) as all funds that are not harmonised under the UCITS Directive.