AIFMD Updates - July 2013 Publication

 

New Proposed European Commission Investment Fund Framework

 

The European Commission has proposed a new investment fund framework designed for investors who want to put money into companies and projects for the longer term. These funds will be set up as private European Long-Term Investment Funds (ELTIFs) and would only invest in companies that require a long term commitment.

 

The ELTIFs would be subject to the upcoming Alternative Investment Fund Managers Directive which will permit investment managers who are authorized under the Alternative Investments Fund Managers Directive (AIFMD) to offer ELTIFs. The EU will not fund ELTIFs, as the goal for these new funds is to provide a framework for private money to be channeled into companies and projects that are not listed on a stock exchange.

 

Under the proposal, ELTIFs would be required to meet a set of common rules so that they:

  • always have a depository to keep assets safe;
  • comply with rules on diversification;
  • only use derivatives to hedge and not for speculation; and
  • obey borrowing limits.

 

The ELTIF proposal will go to the European Council and the Parliament for their approval and would become effective 20 days following publication of the approved proposal in the EU’s Official Journal

 

For more information on the proposal, please see the following link: ec.europa.eu/internal_market/investment/long-term/index_en.htm

Back to Top