A Guide to Financial Regulation for Fintech Entrepreneurs

SHEET 1Alternative Investment Fund Manager Directive

Alternative Investment Fund Manager Directive—The directive regulating alternative investment fund managers

Summary

This directive is regulating alternative investment fund managers (AIFMs; eg managers of hedge, private, and real estate funds). It also regulates the underlying AIFs and their depository service providers, albeit indirectly as it only has jurisdiction over the managers and how they market to their customers.

Relevance for Fintech Companies

As opposed to UCITS funds, alternative funds are not usually targeted at retail investors, so for Fintech companies targeting consumers this directive is probably of secondary importance.

References

• Directive 2011/61/EU (AIFMD)
• Directive 2009/65/EC (UCITS 4)
• Directive 2004/39/EC (MiFID1)

The Alternative Investment Fund Managers Directive is 2011/61/EU. It relies on a number of other directives, notably 2009/65/EC (UCITS 4) and 2004/39/EC (MiFID1).

1.1 General

This directive regulates Alternative Investment Funds (AIFs), ie investment funds that do not fall under the UCITS Directive 2009/65/EC, in the EU. Typical representatives of this class would be hedge funds, private equity funds, and venture capital funds. The directive does not actually regulate the funds themselves, but rather their managers, referred to here as alternative investment fund managers (AIFMs). AIFs are only regulated indirectly in that non‐compliance AIFs with this regulation means that AIFMs ...