AIFM Directive alerts 

8 August 2014 - Guidelines on reporting obligations published by ESMA


With the publication of the translated guidelines on reporting obligations under Article 3(3)(d) and 24(1), (2) and (4) of the AIFMD (ESMA/2014/869) on the ESMA website, the draft guidelines already outlined in Annex II of the Final report (ESMA/2013/1339) issued in November 2013, become effective within 2 months. The guidelines describe AIFM and AIF data reporting under the AIFMD to competent authorities.


22 July 2014 - End of the one year transitional period

The one year transitional period to submit an application for authorisation to the CSSF ended for AIFMs performing activities under the directive before 22 July 2013. As of 22 July 2014, the CSSF received a total number of 773 applications: 215 requests for authorisation of which 151 entities have received their AIFM license; and 558 requests for registration of which 487 entities have been granted the status of registered AIFM.


21 July 2014 - ESMA publishes updated Q&A on the application of the AIFMD


ESMA’s Q&A (2014/868), further clarifies the reporting to national competent authorities under Articles 3, 24 and 42 (section III), and the obligations for depositaries (section VI) and the calculation of leverage (section VII). Key findings are:


  • Section III gives more clarification on reporting data for derivatives, repos, FX spot trades, no trades, reverse repurchase agreements, cash holdings, bank overdrafts, substantial leverage, multiple share classes, re-hypothicated collateral and investment strategies with negative values during the reporting period in the consolidated reporting template. 
  • Section VI clarifies the duties of the depositary: 

  • No cash monitoring is required for cash accounts opened in the name of financial/legal structures set up and controlled by the AIF/AIFM to hold the underlying investments.
  • Cash flow reconciliation cannot be delegated to third parties, and only supporting tasks, such as administrative or technical functions, may be delegated.
  • Cash monitoring includes cash accounts used for subscriptions and redemptions opened in the name of the AIF/AIFM or depositary.
  • Defines ‘close of business day’ for cash monitoring as the end of business day in the jurisdiction in which the depositary is established.
  • Depositaries need to verify AIF compliance with fund rules, instruments of incorporation and anti-money laundering, yet are not obliged to verify compliance with labour law or contracts with third parties unrelated to asset or risk management activities.
  • Confirms that the depositary is required to verify the ownership of derivative contracts that are subject to netting clauses.
  • Confirms that units in funds should be held in custody, unless national law requires that they are registered in the name of the AIF/AIFM.

  • Section VII, a private equity fund raising debt through a financial structure to finance the acquisition of a non-listed company shall be included in the calculation of leverage exposure if certain conditions are met.


18 July 2014 – The CSSF publishes the seventh version of the AIFM FAQ

The seventh version of the AIFM FAQ issued by the CSSF, responds to new questions relating to the calculation of capital requirements (question 17) and on the framework for marketing activities to professional investors in Luxembourg without passport by non-EU AIFMs (question 18).


  • The CSSF clarifies (read in conjunction with related ESMA documents), that an AIFM, that has been authorised or registered in Luxembourg, but has no information to report at the first reporting date, needs to indicate that it has nothing to report.
  • Initial capital and own funds requirements are applicable to a dual licensed UCITS ManCo/AIFM and a single licensed AIFM, as well as the risks to be covered by additional own funds/professional indemnity insurance.
  • Non-EU AIFMs marketing an AIF to professional investors in Luxembourg without a passport, need to inform the CSSF prior to any marketing activity.


Overview of the AIFMD readiness within the European Union


By 22 July 2013, all member states of the European Union were supposed to transpose the AIFMD into national law. Applicable grandfathering rules allow to apply until 22 July 2014 to receive a necessary AIFM license to manage and market AIFs after this date.


As of 24 June 2014, our State of Play document provides an overview of the status of the transposition progress of each EU member state.


The AIFMD has been transposed by the following countries (in alphabetical order): Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Ireland, Latvia, Luxembourg, Malta, Netherlands, Slovenia, Sweden and the United Kingdom. Gibraltar and Liechtenstein also transposed.


For a general overview of the AIFMD, please have a look at our AIFMD brochure Re-shaping for the Future. If you have more specific questions and would like tailored support on your application or implementation, please contact our regulatory advisory team directly.


Belgium adopted the AIFMD

On 17 June 2014, the act implementing the AIFMD in Belgium has been published in the Official Gazette (PDF, 1.6 MB).


AIFMD Insider News

AIFMD Insider News is an online article series that KPMG’s global AIFMD practice created to help those operating in the alternative investment sector to understand the issues; to share advice and insights and to cut through the complexity of AIFMD by exploring some of today’s ‘hot topics’. 



25 March 2014 – ESMA issued Q&A update - Reporting to national competent authorities

Within the Q&A (2014/296 - PDF, 130 KB), ESMA exclusively updated section III, the reporting to national competent authorities. Out of those new and updated 18 questions and answers, key findings are:


  • Repurchase transactions shall be considered as financing operations for the purpose of reporting. Therefore, AIFMs shall take into account the counterparties of those transactions and the aggregated amount when reporting the information related to funding sources.
  • One set of questions is further defining the calculation of the geographical exposure as a percentage of the NAV of the AIF, the basis for numerator and denominator, and the breakdown in investment strategies. Negative values are possible, but should equal 100% as result.
  • AIFMs should aggregate the market value of all securities traded and report the percentage of the market value of securities traded on a regulated exchange or OTC. This also has to be performed for the total number of trades.
  • Further answers are given on how to report the information of the liquidity portfolio, the information on investor liquidity, the definition of the inception date for authorised/pre-authorised AIFs.
  • AIFMs are requested to submit the last AIF report not later than one month after the end of the quarter in which the AIF has been liquidated or is put into liquidation.


20 March 2014 – CSSF updates application questionnaire for the set up of a fully licensed AIFM

From now on, AIFM license applicants are requested to include two additional appendices in their application file. The additions came in an update to the “Application questionnaire for the set up of a fully licensed AIFM” that the CSSF issued on 20 March 2014.


  •  The first new appendix is a table allowing for easy comparison between a company’s remuneration policy and the requirements outlined in Annex II of AIFM Law and ESMA’s Guidelines on sound remuneration. For each requirement, the reference table should include an extract of the corresponding part of the remuneration policy, the status of compliance as well as justifications for partial or non-compliance
  • If your portfolio or risk management activities are delegated, you need to explain how you’re making sure that third party providers also respect the remuneration requirements laid out in Annex II of AIFM Law. This should include information about any other regulatory standards that they comply with, such as MiFID or the CRD package


18 March 2014 – CSSF unveils final timeline and deadlines

On 17 March 2014, the CSSF updated its FAQ (PDF, 207 KB) on AIFMD in which it clarified the start date of the initial reporting period.


The earliest reporting start period for AIFMs authorized between 22 July 2013 and 30 June 2014 will be 1 July 2014, unless AIFMs chooses to report for earlier periods in accordance with the ESMA reporting guidelines. The end date and the deadline for transmission dates will depend on the reporting frequency and the type of AIFs (i.e. funds of funds will have an extra 15 days compared to the other funds).


AIFMs authorized between 1 and 22 July 2014 are required to cover the period from 1 October 2014 to 31 December 2014 in their first reporting, regardless of the reporting frequency of AIFs.


The start date for registered AIFMs falling under the lighter reporting regime will depend on the year they received their registration confirmation. AIFMs registered and confirmed in 2013, will have to cover the period from1 January to 31 December 2014 (or earlier for the voluntary adopters of ESMA reporting guidelines). For 2014 AIFMs, a detailed reporting table has been prepared by the CSSF for guidance.


20 February 2014 – New version of AIFM FAQ released by the CSSF

A new version of AIFM FAQ (PDF, 1.2 MB) was released by the CSSF on 20 February 2014, with new questions on the valuation of AIFs assets and on the requirements for reporting of transaction costs. The CSSF confirms that the appointment of a third party as the AIF’s external valuer must be formalised by a written contract, which clearly states that the third party is appointed as external valuer in the sense of article 17(4)a) of the AIFM law, and sets out its tasks. In relation to transaction costs, Luxembourg Part II funds must disclose the transaction costs in their financial reports.


17 February 2014 – ESMA publishes Q&A document on AIFMD

The Q&A (PDF, 200 KB) includes questions on the application of AIFMD remuneration rules. For AIFMs authorized in 2014 the rules on variable remuneration should apply to the 2015 accounting period.  When delegating portfolio management or risk management activities the remuneration rules should only apply to the delegates identified staff, and only in respect of the remuneration for the delegated activities.  Entities that are subject to the CRD rules are considered to be subject to remuneration rules that are equally as effective as the AIFMD.

13 January 2014 – CSSF issues circular on reporting obligations for AIFMs


The CSSF has issued Circular 14/581 (PDF, 100 KB), clarifying the technical details that AIFMs need in order to fulfill their reporting obligations under the AIFM law. This document details the naming conventions for the reporting files, mechanisms to transfer the files electronically to the CSSF and certain codes and values which have to be included in the reporting files (e.g. national codes, reporting member state).


10 January 2014 - CSSF updates FAQ on AIFMD


The CSSF has published the 4th version of the Frequently Asked Questions (FAQ) document (PDF, 223 KB) concerning the AIFM law in Luxembourg. The CSSF has made additions to topics already covered in the former version and even added several new topics.


Key aspects include:


  • Authorisation procedure:
    All AIFMs benefitting from the grandfathering provisions and which need to be authorised are asked to submit their application request to the CSSF as soon as possible and by 1 April 2014 at the latest.
  • Reporting:
    Date of the first reporting, reporting period and frequency are aligned with the approach proposed by ESMA in the final guidelines on reporting obligations under the AIFMD. The FAQ also confirms that all additional information set out in ESMA’s opinion on reporting under Article 24 (5) of AIFMD have to be reported including, inter alia, information on high-frequency trading, VaR (where relevant) and information on short positions that are held for hedging purposes.
  • Annual reports:
    Authorised AIFMs have to ensure that an annual report based on the elements described in AIFM law is made available in respect of all those AIFs where the AIFMs’ authorisation date is prior to the end of the relevant AIFs fiscal year.
  • Determination of the AIFM in the case of limited partnerships:
    Société en Commandite par Action (SCA) and Société en Commandite Simple (SCS) that qualify as AIF can either be a) internally/self-managed AIFM managed by the gérant in case the purpose of the  gérant is limited to the gérance of the given limited partnership or b) appoint the general partner, gérant or other external AIFM appointed by the gérant. Société en Commandité Spéciale (SCSp) that qualify as AIF can either appoint the general partner, gérant or other external AIFM appointed by the gérant, but cannot be internally/self-managed AIFM.


17 December 2013 - Commission adopts AIFMD RTS defining open-ended and closed ended AIFs


On 17 December the European Commission finally adopted the Regulatory Technical Standards (RTS) to determine types of AIFMs and distinguish whether an AIFM manages open-ended or closed-ended AIFs, or both, to allow the AIFM to correctly apply the specific liquidity management rules and valuation procedures to the different AIFs it manages.  


An open-ended AIF is differentiated from a closed-ended AIF by the fact that it redeems shares from its investors prior to its liquidation or wind-down phase in accordance with a frequency and procedures that are set down in its offering document or instruments of incorporation.  Any reduction in the capital of an AIF in line with its instruments of incorporation and any trading of an AIF on a secondary market should not be considered as a redemption of shares and should not render an AIF open-ended.


To take account for the fact that no harmonised definition of closed-ended AIFs existed in the EU prior to the AIFMD, the RTS clarifies that AIFMs can benefit from the transitional periods in Articles 61(3) and (4) of the AIFMD and continue to manage without a license their closed-ended AIFs that are in an advanced or final stage of their investment cycle, if they manage closed-ended AIF that have not redeemed their shares for an initial period of 5 years.


12 December 2013 AIFMD MoUs signed by the EU authorities

ESMA provides an useful summary (PDF, 132 KB) of the state of play regarding the signature of the MoUs with third country regulators on their website.


1 October 2013 - AIFMD transposition status

A brief updated overview of the impact on AIFMs of the transposition requirements of the AIFMD now that the deadline for EU member states to transpose the Directive into national law has passed.


1 October 2013 – ESMA published the final guidelines on the reporting obligations for alternative investment fund managers

These guidelines provide clarification on the information that AIFMs should report to the authorities as well as indications as to the timing of reporting. ESMA also published some technical supporting material (a consolidated reporting template, detailed IT guidance for filing of the XML and the XSD schema) that will facilitate the reporting by AIFMs to regulators. In addition to the guidelines ESMA published an Opinion providing details on a set of supplementary information that, in its view, the national authorities should require of AIFMs for the monitoring of systemic risk. This includes information on the number of transactions and their values carried out using high frequency algorithmic trading and information on the VaR of the AIFs. The relevant ESMA documents are available here. A summary has been posted in our Fund News, edition 107.

6 September 2013 – FCA’s publishes proposal for implementing the AIFMD’s Remuneration Code

The FCA published its consultation paper (‘CP 13/9’) which includes, in Chapter 14, its proposals and draft guidance setting out how it intends to amend the FCA’s AIFM Remuneration Code (SYSC 19B) to implement key elements of ESMA’s final guidelines on AIFM remuneration. Chapter 14 of FCA’s CP 13/9 (361 pages) is available here. A summary has been posted in our Fund News, edition 107.


21 August 2013 – ESMA opinion on draft Regulatory Technical Standards on types of AIFMs


ESMA has published its formal opinion to the European Commission, in response to the letter received on 8 July from the Commission, which rejected ESMA’s draft Regulatory Technical Standards on the types of AIFMs. The opinion can be found via this link


In the opinion ESMA makes it clear, that it stands behind its original interpretation of the AIFMD Level 1 text and disagrees with the view of DG Markt, but has prepared an amended draft to ensure timely implementation of the AIFMD: 


“ESMA does not consider that the solution proposed by DG MARKT in the Letter is the only reasonable way of interpreting the AIFMD provisions. In this respect, ESMA would like to stress that draft RTS submitted by ESMA should be made subject to amendments by the Commission only in very restricted and extraordinary circumstances.


However, in order to ensure a timely implementation of the AIFMD provisions and move the process forward with the Commission, ESMA decided to submit an amended version of the draft RTS for the Commission’s consideration.


ESMA believes that these revised RTS fully address the concerns expressed in the Letter, while retaining some more flexibility to take account of existing market practice. Indeed, the key element for the identification of an open-ended AIF on the basis of the revised RTS is the existence of repurchases or redemptions of the AIF’s shares or units prior to the commencement of its liquidation phase or wind-down, provided that the repurchases or redemptions happen at the investors’ request. At the same time, the revised draft clarifies that certain decreases in the capital of the AIF do not qualify as repurchases or redemptions for the purpose of the definition.”


14 August 2013 – ESMA final guidelines on the key concepts of the AIFMD 


ESMA published its final guidelines on the key concepts of the AIFMD, which include definitions around what is considered to be an AIF.


The guidelines can be consulted on the ESMA website and  have been translated into the official languages of the EU. They will enter into force in two months, following the date of publication by ESMA.


In accordance with Article 16(3) of the ESMA Regulation, competent authorities and financial market participants must make every effort to comply with the guidelines. Competent authorities to whom the guidelines apply should comply by incorporating them into their supervisory practices.


Competent authorities to which these guidelines apply must notify ESMA whether they comply or intend to comply with the guidelines, with reasons for non-compliance, within two months of the date of publication by ESMA.


1 August 2013 - ESMA issues an Opinion on practical arrangements for the late transposition of the AIFMD

ESMA believes that the late transposition should not be an impediment to the use of the AIFM marketing or management passport. The passages concerned are as follows:

  • Notification of marketing of EU AIFs when the host MS of the AIFM has not transposed the Directive (Articles 31 and 32 of the Directive)
  • Management passport (Article 33 of the Directive)


Find the complete version of the Opinion by ESMA (PDF, 97KB)

18 July 2013 – Summer update from CSSF sets 16 August self-assessment deadline for all potential AIFM, subject to authorization

With the AIFMD fully transposed into Luxembourg law, the CSSF now requires any person established in Luxembourg and potentially qualifying as an AIFM to perform a self-assessment to:

  • Evaluate whether it qualifies as an AIFM under the new AIFM law, and if yes
  • Assess whether it falls under the authorization or registration requirements of the AIFM law.

Read on about the requirements here

15 July 2013 - Luxembourg publishes the AIFM Act

On 15 July 2013, Luxembourg published the AIFM Act in the Mémorial, signaling that the act has now officially entered into force. The act was published in Mémorial n°119 “Gestionnaires de fonds d’investissement alternatifs” a week ahead of the 22 July EU deadline for transposition. 

Access the Mémorial in full here (PDF, 340 MB)


10 July 2013 - Luxembourg Parliament adopts new AIFM Act, fully transposing the AIFMD into national law


On 10 July 2013 the Luxembourg Parliament voted the Bill of law n°6471 transposing the AIFMD (Alternative Investment Fund Managers Directive 2011/61/EU) in Luxembourg. The AIFM Act will enter into force on the day of its publication in the Mémorial (official gazette) which is expected to occur within days, and in advance of official EU deadline for transposition of 22 July 2013. The accompanying detailed AIFMD implementing rules take the form of EU Regulations and as such are directly applicable in Luxembourg, without the need for any local transposition.
Read more on the new act here


18 June 2013 – CSSF provides AIFMD FAQ and authorisation questionnaire


The CSSF published a FAQ (PDF, 100 KB) highlighting some of the key aspects of the AIFMD regulation from a Luxembourg perspective and a questionnaire on the AIFM authorisation / registration procedure. These publications primarily address AIFMs and AIFs that are already established in or would like to set up in Luxembourg and occur in anticipation of the adoption of the Luxembourg law implementing AIFMD by the parliament, expected to be published by the end of June or in early July. 


7 June 2013 – German Federal Council agreed to AIFMD implementation draft

The German Federal Council (Bundesrat) agreed to the draft Kapitalanlagegesetzbuch (KAGB) (PDF, 2.16 MB)  adopted by the Federal Parliament (Bundestag) on 17 May 2013. Therefore, Germany is the first country adopting the AIFM Directive.
The AIFM Tax Adaptation Law (separated bill) was rejected by Bundesrat and will now have to go to conciliation committee.


24 May 2013 – ESMA launches guidelines on reporting obligations of the AIFMD


ESMA published its guidelines on reporting obligations, and consults on further clarifying the information that AIFMs have to report to national competent authorities, the timing and reporting period, as well as procedures to follow when AIFMs move from one reporting obligation to another. The consultation is open until 1 July 2013.


24 May 2013 – ESMA published final report on key concepts of the AIFMD

The purpose of these guidelines is to ensure a common and consistent application of the concepts that comprise the definition of AIF in Article 4(1)a of the AIFMD by clarifying each of these concepts. The guidelines will now be translated into the official languages of the EU, and the final texts will be published on the ESMA website. The guidelines will become applicable two months after the publication of the translations.


21 May 2013 – Parliament issued draft bill of law 6471 including amendments

The Parliament (Chambre des Deputés) issued the bill of law 6471 inlcuding amendments by observations of the Council of State (Conseil d’Etat) and of the Parliament’s Finance and Budget Commission. 


16 May 2013 – Regulations published in the Official Journal of the European Union



15 May 2013 – Central Bank of Ireland published its AIF Rulebook, a Q&A document and draft application forms

The draft application forms allow AIFMs to apply for authorisation. All documents are available on their website.


30 April 2013 – Overview: AIFMD Transposition across EU Member States


Member states will have to transpose the AIFMD into national law by 22 July 2013.


This overview provides you with the State of Play (PDF, 690 KB) for each Member State.


23 April 2013 – Draft bill to implement AIFMD deposited in Austrian Parliament


The draft bill to implement the AIFM Directive has been deposited at the Austrian Parliament. The consultation period ends on the 8 May 2013.


17 April 2013 – French Trésor launched a public consultation to implement AIFMD

The French Trésor launched a public consultation on the draft regulations that will transpose the AIFMD into French law. The consultation closed for comment on 15 May 2013.


16 April 2013 – The French regulator AMF published a Q&A for AIFMs

The Autorité des Marchés Financiers (AMF) has published a Q&A document (PDF, 760 KB) to help asset management companies to prepare for the implementation of the AIFMD. It is designed as a user guide for existing asset management companies and provides among other points a practical description of getting an authorisation under the AIFM Directive. Asset management companies now have the possibility to file an AIFM authorisation application with the AMF.


2 April 2013 – ESMA publishes draft regulatory technical standards on types of AIFMs


ESMA has published its draft regulatory technical standards (RTS) (PDF, 117KB) to determine types of AIFMs, where relevant in the application of the AIFMD.


The draft RTS distinguish AIFMs managing AIF of the open-ended type and AIFMs managing AIFs of the closed-ended type. The definitions set out in the RTS are needed in order to apply the rules on liquidity management, the valuation procedures and the transitional provisions of the AIFMD. The document will now go to the European Commission for final adoption.


27 March 2013 – European Commission publishes Q&A on AIFMD


The European Commission published on its website a Q&A section on the application of the AIFMD. 
This section provides responses to several technical questions raised in relation to AIFMD, including the key topic of the transitional period for pre-existing AIFMs. 
Further questions can also be submitted directly to the Commission online.
The Q&A section covers following topics:

  • Cooperation between Member States' competent authorities
  • Definition of an AIF
  • Delegation
  • Depositary
  • Issues related to Article 37 AIFMD
  • Issues related to master AIFs and feeder AIFs
  • Issues related to private equity
  • Marketing to retail investors
  • MiFID firms and MiFID activities
  • Own funds
  • Passport issues
  • Remuneration
  • Reporting requirements
  • Responsibility of Member States' competent authorities
  • Scope and exemptions
  • Transitional provisions
  • Transposition
  • Valuation  

22 March 2013 – AIFMD Commission Delegated Regulation (“Level 2”) published in the Official Journal of the EU


The AIFMD Commission Delegated Regulation (EU) (PDF, 1.5 MB) No 231/2013 of 19 December 2012 was published in the Official Journal of the European Union on 22 March 2013. It will enter into force on 20 days after publication (11 April) and will apply from 22 July 2013. It supplements the AIFM Directive 2011/61/EU of the European Parliament and of the Council with regard to exemptions, general operating conditions, depositaries, leverage, transparency and supervision. 


19 March 2013 – FSA issued second consultation paper


On 19 March 2013, the FSA issued a second consultation paper (CP13/9) (PDF, 2.3 MB)  to cover all persistent issues set out in Annex 6 of the first consultation paper (November 2012). Responses are accepted until 10 May 2013.


13 March 2013 - HM Treasury published a second consultation on AIFMD transposition

HM Treasury published a second consultation (PDF, 240KB) to transpose the AIFMD. The transposition into UK law will require a further set of policy decisions which could not be consulted on in time for the first consultation paper. Draft regulations (PDF, 50 KB) accompany this consultation paper and these are intended to be combined with the draft regulations attached to the first consultation paper. Comments on the consultation can be made until 5 April 2013.


February 2013 – AIFMD: Re-shaping of the Future (Third Edition)

The AIFMD will have a significant re-shaping effect on the alternative investment fund industry in Europe and beyond.

In this Third Edition (PDF, 1.3 MB), we provide an overview of the AIFMD (Level I and Level II) legal and regulatory framework that will govern the alternative investment fund industry in the EU from July 2013 and re-shape the operations of managers and the alternative funds they manage.


11 February 2013 – ESMA: Final Report on Guidelines on Remuneration of AIFMs

AIFMs will be asked to introduce sound and prudent remuneration policies and organisational structures which avoid conflicts of interest that may lead to excessive risk taking. Key elements include:

  • AIFs internal governance: that sound and prudent remuneration policies/ structures exist and are not circumvented
  • Categories of staff covered, whose activities might have material impact on the AIFs risk profile (senior management, risk takers, control functions, and similar)
  • Types of remuneration covering all forms and amounts of payment or benefit paid by the AIFM/AIF (Incl. carried interest, transfer of units), being divided into fixed (without linkage to performance) and variable (additional remuneration due to performance)

Guidelines (PDF, 900KB) will apply from 22 July 2013, subject to transitional provisions of the AIFMD.

KPMG’s advisory department on Remuneration is providing summary slides (PDF, 1.3 MB) and is available for consultation.


Overview of cooperation arrangements with Third Countries


The co-operation arrangements under AIFMD shall be in place between EU and non-EU securities supervisors by July 2013. This will be done through a common Memorandum of Understanding (MoU), which will facilitate the cross-border supervision of those entities subject to AIFMD such as managers of alternative investment funds, depositaries and entities performing tasks under delegation by the manager.

ESMA is discussing with non-EU supervisors of entities subject to the requirements of the AIFMD about supervisory co-operation issues. The overview of the cooperation arrangements with Third Countries (PDF, 424KB)  can be accessed here.

21 December – AIFMD Level 2 implementing measures in a nutshell


Deadline looming
The long awaited Delegated Act supplementing the Alternative Investment Fund Manager Directive (AIFMD) was released on 19 December 2012, providing an extensive set of detailed implementing measures and technical rules on a wide range of business areas.


Key highlights of the “Level 2 Implementing Measures”:

  • The act takes the form of a regulation and does not need any national transposition but will be directly applicable in all EU Member States. However, European Parliament and Council have a period of 3 months, which may be extended to 6 months, to object to this act. If there are no objections, the Delegated Regulation will be applicable from 22 July 2013.
  • The Regulation specifies the delegation rules of the AIFMD and, in particular, sets out the definition of a letter-box entity. This may have a significant impact on the business and/or operating models of some alternative fund managers.
  • The duties of the depositary and the liability regime are defined in a strict manner. This may impact operating and business models of some depositaries and lead to different fee structures.
  • The rules set out by the Commission diverge on some key points from ESMA’s technical advice from November 2011.


KPMG Luxembourg prepared a handy summary document of most important aspects of AIFMD level 2 implementing measures. This document can be consulted here.


In addition, our Managing Partner Georges Bock and Charles Muller, our Partner in charge of the European Center of Excellence for Investment Management, discuss the substantial strategic impacts on asset managers of the AIFMD “Level 2” implementing measures. Click here to view the video on KPMG TV.


 19 December – ESMA clarifies rules for AIFs and their AIFM



The closing date for responses to these consultations is 1 February 2013. The Guidelines and Technical Standards will be finalised in the first half of 2013. 


12 December - German government adopted draft law of AIFMD transposition


On 12 December 2012 the German government adopted a draft of the law to transpose the AIFMD into German law (Government Draft) including the new ‘Capital Investment Act’ (Kapitalanlagegesetzbuch - KAGB). This act is set to replace the existing German Investment Act (Investmentgesetz). The new regime would then cover UCITS and alternative investment funds as well as their managers. The upcoming KAGB would therefore create a single framework covering both rules for products and managers. As the next step, the Government Draft will have to be presented to the German parliament and go through the parliamentary process.


November 2012 – FSA publishes consultation paper on AIFMD


On 14 November 2012 the FSA issued the consultation paper CP12/32. Closing period is 1 February 2013. This is the first of two planned consultations on rules and guidance to transpose the requirements of the AIFM Directive into UK law. It follows on from the Discussion Paper (DP12/1) that was issued in January 2012. 


The CP1 is addressing following issues:


  • The prudential regime for all types of AIFM, including capital requirements, risk of professional negligence, the liquid assets requirement and reporting requirements, as well as changes affecting UCITS management companies;

  • The regime for depositaries, including the eligibility of firms to be an AIF depositary, the capital requirements, and the requirement to act independently; and

  • The Level 1 Directive requirements on AIFMs, including organisational matters, duties in relation to management of funds, and transparency obligations towards investors and the FCA.


The FSA intends to issue the second part of the Consultation paper (CP2) in February 2013 to cover the outstanding topics, with a consultation period of only eight weeks.  


November 2012 – AIFMD e*Books for iPad


AIFM Directive (English Version) and AIFMD – Luxembourg draft transposition law 6471 (French Version)

KPMG Luxembourg created two handy e*Book versions for iPad users which can be best viewed, searched and annotated in "iBooks" free application of your iPad.

The first e*Book features AIFM Directive 2011/61/EU entered into force on 21 July 2011. You can get your personal e*Book copy of AIFM Directive here (EPUB, 3.49 MB)

The second e*Book contains the Luxembourg Draft Law 6471 submitted to the Parliament for the implementation of the AIFMD into Luxembourg law.

You can download your personal e*Book version of Luxembourg Draft Law transposing AIFMD here (EPUB, 3.86 MB). 


October 2012 – Irish Central Bank publishes consultation paper on AIFMD


On 30 October 2012 the Irish Central Bank published a consultation paper CP60 on the implementation of the AIFMD that will close on 11 December 2012.  The Central Bank has drafted a revised framework for the regulation of non-UCITS investment funds, creating a single ‘AIF handbook’ to replace NU Notices and Guidance Notes.  When the consultation process is complete the Central Bank intends to issue an interim AIF Handbook on which the industry can rely as a guide to the proposed post-AIFMD regulatory framework.


September 2012 – ESMA’s Open Hearing on guidelines on sound remuneration policies under the AIFMD


On Tuesday, 29 September, the European Securities and Markets Authority (ESMA) opens its doors for an “Open Hearing on guidelines on sound remuneration policies under the AIFMD”, located at Auditorium, level -1, ESMA, 103 Rue de Grenelle, 75007 Paris, 10.30-13.30..

Please follow this link to the official webpage, including the Consultation paper “Draft Guidelines on sound remuneration policies under the AIFMD”

This hearing is open to the public, free of charge. To participate you are required to register online:


August 2012 – Luxembourg draft AIFMD transposition law published


On Friday, 24 August, Luc Frieden, Minister of Finance, deposited in Parliament the draft law that will implement the AIFMD into national Luxembourg law. The document takes the Bill number 6471 - Bill-number-6471.pdf  (2.6 MB) - and is also available under

In addition to the transposition into national law itself, the text also modifies a certain number of existing laws including the 2010 UCI law, the SIF and SICAR laws. The text then also intends to update existing legislation regarding the “société en commandite simple” and creates a new form of corporate structure called a “société en commandite spéciale” inspired by the Anglo-Saxon “limited partnership” concept.  Finally, the text contains certain tax provisions, including the notion of “carried interest”.

The draft will now go to the “Conseil d’Etat” for its opinion and to the Parliament’s Finance and Budget Commission for its review. A final adoption could take place by the end of this year.


June 2012 – ESMA publishes consultation paper on remuneration  


ESMA has published a consultation paper on the proposed guidelines on remuneration of AIFM. These funds will be asked to introduce sound and prudent remuneration policies and structures with the aim of increasing investor protection and avoiding conflicts of interest that may lead to excessive risk taking. The key elements of the guidelines include: 


  • Types of remuneration
  • Who determines the remuneration policy
  • How to identify the categories of staff covered 
  • Governance of remuneration
  • General requirements on risk alignment
  • Disclosure requirements


The consultation runs until 27 September and ESMA aims to publish a final report before the end of 2012, so that they will be in place in advance of the AIFMD transposition deadline of 22 July 2013.


May 2012 – Level II rules – Drafts of the Commission’s Delegated Regulation  


Two draft versions of the Level II measures (Delegated Regulation) for the AIFMD have come into circulation. The purpose of this Delegated Regulation is to provide the implementing measures to some provisions in AIFMD. These draft have caused much debate across the industry due to the fact that the Commission’s drafts significantly differ from the ESMA guidelines on several key points such as :


  • Third-country provisions 
  • Depositary liability
  • Delegation
  • Leverage


Surprising to some, this Level II act will take the form of a regulation. As such, the rules will become effective sooner whereas a directive allows a couple of years for transposition into national laws. A regulation also removes the flexibility of national regulators to implement the measures into local laws.


The Alternative Investment Management Association (AIMA) has published a paper - paper.pdf  (275 KB) - to analyse the divergences between the European Commission’s draft and ESMA’s advice.


AIFMD Alert – 5 April 2012


Don’t miss the opportunity to register for our upcoming Business Dialogue Event for Private Equity and Real Estate Professionals: 


“AIFMD level II measures - Understanding the European Commission’s position following ESMA’s technical advice”


The presentation is scheduled on June 27 (Wed) from 10.30 to 12.00. The registration is free but the number of places is limited.


24 March 2010


ESMA published responses on its consultation on key concepts of the Alternative Investment Fund Managers Directive (“AIFMD”) and types of AIFM published on 23 February 2012. The deadline for the response was 23 March 2012. The discussion paper can be consulted here - ESMA-consultation-paper.pdf (361 KB)


ESMA expects to issue a formal proposal for draft regulatory technical standards to determine types of AIFMs, where relevant in the application of the Directive in the second quarter 2012.


 2 February 2012 - AIFMD - towards level II rules - FSA launched a new debate


 Late January 2012, UK Financial Service Authority (“FSA”) published a discussion paper on implementation of the Alternative Investment Fund Managers Directive (“AIFMD”). This newly launched debate aims to gather views from “alternative” players on a number of somewhat controversial issues, such as depositaries, valuation, remuneration, regulatory capital, risk management and the special regime potentially applicable to smaller managers. The deadline for the response is March 2012. The discussion paper  can be consulted here


23 November 2011 - II Level measures published by ESMA


ESMA published its final technical advice (final-report.pdf, 2.4 MB) on the (“AIFMD”) on 16 November 2011. This 500-page, largely technical document, brings further clarity to many fundamental issues of the Directive.


During the annual ALFI European Alternative Investment Funds conference which took place on 22 and 23 November 2011, Luc Frieden – Mininster of Finance of the Grand Duchy of Luxembourg, sent a strong signal to the “alternative” community by emphasising that Luxembourg will be one of the first EU countries to implement the Directive as it was done for UCITS in the past.  


KPMG Luxembourg prepared a 2-page overview (level2-ESMA-final-advice.pdf, 378 KB) that summarises major points of interest contained in ESMA’s final advice as well as key notes to the attention of Asset Managers, Depositories and Administrators. 


September 2011


Earlier in September 2011, ESMA published responses to its second consultation paper (ESMA-consultation-paper.pdf, 151 KB) on possible implementing measures of the Alternative Investment Fund Managers Directive (“AIMFD”) in relation to supervision and third countries which were submitted by the industry on 23 September 2011. This draft technical advice provides a technical note on the topics relating to supervision and third countries, including marketing of third country alternative investment funds to EU investors, supervisory required for the delegation of certain functions to third country entities, and the appointment of third country depositaries. 


The matters addressed in this second consultation paper are very important to the “alternative” community and affect not only alternative investment fund Managers (“AIFM”) established outside EU and those managing third country alternative investment funds (“AIF”) but also those decided to delegate.   


On 26 September 2011, many stakeholders attended a public hearing at ESMA regarding these implementation measures.


Main topics of this hearing session were re-introduction of notion of equivalence and definition of the Member State of reference in cases where there are several Member States of reference.  


Draft responses on an earlier Consultation Paper on ESMA's draft technical advices to the European Commission which deal with several implementing measures of the Alternative Investment Fund Managers Directive (AIFMD), such as authorisation, general operation conditions, depositaries, leverage and transparency have been also published.  


Original consultation paper can be consulted here (ESMA-consultation-paper-part1.pdf, 1.9 MB). 


What’s AIFMD?


The Alternative Investment Fund Managers Directive (“AIFMD”) aims at regulating the distributions / marketing of alternative investment funds and the organizations / operations of their managers. The Directive, approved in November 2010 by the European Parliament, has been adopted by the EU Council on 27 May 2011.


The directive has been published in the Official Journal on 1 July 2011 and entered into force on July 21, 2011.Member States will then have 2 years (until July 21, 2013) for the transposition into national law.


The press release (press-release.pdf, 87.7 KB)  summarising the main key points of the directive can be consulted on the Council website. 


 Check out our AIFMD webpage in the Value for Funds section.


Where is the EU regulator in the process?


The European Commission has requested advice from ESMA on the content of implementing measures by 16 November 2011 and this advice was provided by ESMA on this date (final-report.pdf, 2.4 MB).


The European Commission is expected to finalise level II measures by November 2012 as latest.


KPMG in Luxembourg actively participates in AIFM working groups of Luxembourg Private Equity Association (“LPEA”), The Luxembourg Bankers' Association (“ABBL”), Commission de Surveillance du Secteur Financier (“CSSF”) and Association of the Luxembourg Fund Industry (“ALFI”) and participated in through those bodies in the responses to the ESMA discussion papers. As part of the Luxembourg delegation, we have also participated in various meetings with chairs of the task force, such as task force 2 on authorisation, delegation and organizational requirements.



Side effect of the directive:


On 16 June 2011, The European Commission, launched a consultation on new rules for venture capital funds which can be consulted here (consultation-paper-en.pdf, 80 KB). 
This consultation document focuses on the creation of an Internal Market for venture capital and presents the core elements of a possible European framework in relation to the venture capital funds in the context of AIFM framework and a tailor-made system as a stand-alone alternative to AIFMD.


The consultation closed on 10 August 2011. 


How we can help? 


Even if the final approval of level II implementing measures will take place mid/end 2012, the final ESMA’s technical advice clearly brings more certainty on which decisions can be based and actions taken.


2012 is therefore the year when most of the strategic work should be carried out in order to determine the main impacts on the organizations and to consider any first mover advantage.


This is not only relevant for the managers but also for many service providers such as administrators and custodians.


Decisions of importance such as appointment and/or redomiciliation of the Managers or their funds and operational requirements’ alignment need time and careful analysis to assess all implications: whether it is operational, financial, tax or human.


New fund launches should anticipate the regulatory developments and this is equally important to assess the impacts on existing funds and investment vehicles.


We are part of the debate at many levels and we are happy to assist our clients in this first key phase of the regulation. We have the experience to assist you in thinking through the various aspects of the regulations and the impact on your organizations, cutting through complexity.


Our solution framework which looks like: 



AIFMD graph

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Charles Muller


Tel. +352 22 51 51 7950


Dee Ruddy

Tel. +352 22 51 51 7369

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