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I cannot think of a new piece of legislation which has caused more consternation than the EU Alternative Investment Fund Managers Directive (AIFMD) which became effective on July 22 2013.
The general idea is relatively simple – and welcome. It will offer cross border marketing and management passports for alternative investment fund managers (AIFMs) of alternative investment funds (AIFs) which can be offered to professional investors. In time, an AIF brand may develop for professional investor funds in the same way as the UCITS brand is well established for retail funds.
But, in the short term, the task for AIFMs to find practical solutions to the challenges the Directive presents – and its numerous unintended consequences. This Article looks at some of its problems and some possible solutions – taking particularly the UK perspective, noting that the vast majority of European AIFMs are UK based.