Significant Amendments To The German Investment Act

In 2007 a fundamental overhaul of the German Investment Act (the Investment Act) took place. The amendments to the Investment Act became effective on 28 December 2007. They are designed to significantly modernise German investment fund laws. The key amendments relate to:

• deregulation;

• excluding certain foreign closed-ended funds from the scope of the Investment Act;

• further harmonisation with EU law;

• creating new asset classes to facilitate product innovation; and

• improving the corporate governance of investment companies.

Whereas the majority of the changes to the Investment Act affect exclusively the German investment industry, a number of amendments also affect foreign investment funds.