Update On Status Of AIFMD Implementation And Passport For Non-EU Funds

It's been almost three years since the Alternative Investment Fund Managers Directive ("AIFMD" or "Directive") – a far-reaching EU-level regulation of managers of any funds marketed in the EU that do not fall within the "UCITS" category – was implemented in most European jurisdictions. In exchange for a panoply of new restrictions and requirements, AIFMD offered – and has delivered – an EU-wide "passport" to managers and funds, allowing them to distribute their funds throughout the EU based on a single registration in the manager's home country, subject only to local marketing requirements.

As part of the AIFMD package, non-EU managers and funds are shielded from having to comply with the Directive but are also denied the right to use the passport, with this "dual regime" meant to last about two to five years. In the meantime, the only path to access the EU market continues to be through the much-criticized patchwork of national private placement regimes ("NPPRs").