Following a period of extensive negotiation between European legislators and lobbyists from the alternative investment fund industry, the Alternative Investment Fund Managers Directive (the Directive) was finally approved by the European Parliament on 11 November 2010. The Directive encompasses a harmonized regime for the authorisation of all alternative investment fund mangers established within the EU (EU AIFM) together with the imposition of certain operational and transparency requirements on such managers. The Directive also has important implications for managers of alternative investment funds that are based outside of the EU (non-EU AIFM) and intend to market their alternative investment funds (AIFs) to EU investors or manage EU AIFs.
The Directive has been subject to a high degree of politicised debate not least in relation to the constraints that were originally placed on the ability of non-EU AIFMs to market their funds to European investors in earlier drafts of the Directive. It is with this in mind that this alert focuses on the scope and the extent of the Directives effect on non-EU AIFMs who will look to market their fund products to European investors. While the focus of this alert relates to the marketing issues for non-EU AIFMs, this alert will also briefly summarize the future legislative process of the Directive and make reference to some of the broader implications of the Directive on EU AIFMs (which may become relevant to non-EU AIFMs in the future).