France disappoints on AIFMD

Non-EU fund managers will have to meet all of the directive’s requirements to solicit capital from French investors.

Guidance published by the French securities regulator has left non-EU fund managers needing to meet the requirements of the Alternative Investment Fund Managers Directive (AIFMD) if they want to market in France.

The long-awaited French marketing instructions for fund managers were issued last week by the French Monetary and Financial Authority (AMF).

Under Section III of the guidance, non-EU fund managers can request authorization to market funds in France, subject to the following conditions (which are identical to those laid out in the directive):

• Naming a ‘depositary-lite’ to act as an investor safeguard responsible for safekeeping funds' financial assets, monitoring cash flows and ensuring a GP complies with its own governing documents

• Having a cooperation agreement in place between the fund manager’s home state and France

• Ensuring that the fund manager’s home state is not a Financial Action Task Force blacklisted country

The guidance goes also requires the fund manager to apply for authorization with the AMF and to provide proof that it meets the other requirements of the AIFMD – including those around capital, risk management, valuation, delegation, remuneration and reporting.

Germany adopted a similar approach by ‘abolishing’ its private placement regime, meaning fund managers soliciting capital in Germany fall under the AIFMD regime by default.

This will make life very difficult, according to Andreas Rodin, founding partner of German law firm P + P P?llath + Partners. “From a practical perspective it is almost impossible [for non-EU managers] to achieve this,” he said previously.