ILPA Issues New Guidance On Subscription Facilities

Last week, the Institutional Limited Partners Association ("ILPA") issued follow-on guidance on the use of subscription facilities. The new guidance (the "2020 Guidance") entitled "Enhancing Transparency Around Subscription Lines of Credit"¹ is meant to be read in conjunction with ILPA's 2017 guidelines on the use of subscription facilities and focuses on recommended quarterly and annual disclosures to be provided by fund managers to investors.

Despite speculation that fund investors would insist on the wholesale adoption of the ILPA's 2017 guidelines for new funds, this has not turned out to be the case. Rather, discussions between investors and fund managers on the use of subscription facilities have focused on a handful of key points, while the terms of the actual credit facilities have remain substantially unchanged and the use of such facilities by fund managers has continued to grow. One area where the market has responded positively to the 2017 guidelines