Italy's private equity industry expects its local securities regulator, the Bank of Italy, to be in a position to authorize private equity fund managers under the Alternative Investment Fund Managers (AIFM) directive by July 22 – the deadline date EU regulators set for EU member states to transpose the bill into national law.
The Bank of Italy, which has yet to issue AIFM guidance, did not respond to multiple requests for comment.
The industry feared the regulator would miss its deadline as a difficult political and economic situation led lawmakers to overlook the directive in favor of more pressing issues. Sources also point to a pattern of Italy missing legislative deadlines set by EU authorities, including for example a late implementation of the Prospectus Directive which creates a common set of standards for securities prospectuses across the EU.
Italy's already robust funds framework is part of the reason the regulator is prepared for the directive, according to Alessandra Bechi, tax and legal director for Italy's private equity trade group the ALFI.
[Italy] cannot and will not refuse notifications of offerings from foreign fund managers
“The Italian framework was a benchmark for other countries and for the EU approach” towards AIFM directive rulemaking, said Bechi, citing rules on depositaries and risk management as areas where Italy-based general partners already meet the directive's requirements. Still needed is guidance on pay rules, which Bechi expects the Bank of Italy to eventually issue.
AIFM authorized fund managers who want to solicit Italy-based private equity investors should be able to market their funds past July 22, according to a Milan-based funds lawyer, who said the regulator verbally confirmed to him that Italy “cannot and will not refuse notifications of offerings from foreign fund managers” authorized under the directive.
A lack of guidance has given the Italian private equity industry more time to lobby for toned down fund rules, according to Umberto Piattelli, Milan-based private equity partner at Osborne Clarke.
Italy's funds regime is stricter than what the directive requires in certain areas. For example Italy requires general partners to have €1 million in capital reserves on hand for emergencies, whereas the directive only requires €125,000 to be kept in reserve.
For a look at how the UK, Ireland, Luxembourg, Germany and France are transposing the AIFM directive into national law ahead of a July 22 deadline, be sure to read the July issue of PE Manager.