A winning hand – as the AIFMD comes into force, is the offshore model a better option for alternative fund managers?
The manner in which the EU Alternative Investment Fund Managers Directive (AIFMD) is playing out has all the appearance of a high-stakes poker game. The European Securities and Markets Authority (ESMA), national regulators, EU managers, EU domiciles and offshore jurisdictions are all playing their hands very close to their chests and watching each other intently for any tells that will give them an advantage. Will the game end with one winner scooping the pot? Or will it turn out to have been Monopoly money all along, leaving the players nursing hangovers and parting with promises to do it all again soon? From the outset, observers predicted that key players would fold, but this hasn't happened. Why not? On the face of it, the next watershed date is 22 July 2014 – the expiry of the transitional periods adopted by many member states. This interim has given alternative investment fund managers (AIFMs) ample opportunity to delay, but it appears many UK managers are really pushing this to the limit. Recent market research from BNY Mellon suggests that barely 20 per cent of the AIFMs who would be expected to seek authorisation under the AIFMD implementing legislation have actually done so yet.
With the EU Alternative Investment Fund Managers Directive proving restrictive and costly, Simon Harding asks whether the offshore model offers a better deal for managers
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