The European Parliament has adopted the AIFMD 2.0 text
On 7 February 2024, the European Parliament adopted the final version of the text amending the Alternative Investment Fund Managers Directive (AIFMD 2.0).
AIFMD 2.0, will come into effect 20 days after its publication in the Official Journal of the European Union (OJEU). EU Member States will then have 2 years to transpose it into their national legislation.
Key highlights of AIFMD 2.0 include:
- Liquidity management: AIFs should adopt a closed-ended structure where they engage in loan origination to a significant extent (60 per cent of net asset value (NAV)). For open ended AIFs a new Annex V is introduced prescribing liquidity management tools (LMT). At least 2 LMTs should be adopted by the AIFM (suspension of redemptions plus one additional LMT).
- Substance and Resources: Specific references to staff requirements (at least 2) and technical resources.
- Delegation Notifications: Ensuring ESMA receives notifications of delegation arrangements where more risk or portfolio management is delegated to third country entities than is retained.
- Definition of delegation: Delegation arrangement rules are extended to include all “functions” listed in Annex 1 plus auxiliary services (the word services is now used rather than functions).
- Loan origination by AIFs: The AIFMD has always been a manager directive and has not regulated the AIF “product” directly. Under AIFMD 2.0, common rules are introduced in respect of loan-originating AIFs.
- Depositary passport: No passport is introduced but competent authorities may allow depositary services to be procured in other member states.
Additionally, the directive introduces corresponding adjustments to the UCITS Directive, with the goal of aligning delegation, reporting, and liquidity management regulations across both the AIFMD and UCITS frameworks.
The final compromise text amending AIFMD 2.0, was published by the European Commission on 13 November 2023, marking the conclusion of technical discussions and consultations between the EU Commission, the Council of the European Union, and the Parliament. The original draft proposal for AIFMD 2.0 was released on 25 November 2021, with political agreement reached on 20 July 2023.
The text adopted can be found here.
