The European Securities and Markets Authority (Esma) published its advice on the application of the Alternative Investment Fund Managers Directive (AIFMD) passport in Australia, Bermuda, Canada, Cayman Islands, Guernsey, Hong Kong, Japan, Jersey, Isle of Man, Singapore, Switzerland, and the United States.
As part of a possible extension, which is yet to be vetted by the European Commission, Parliament and Council, the countries in question could market and manage funds AIDMD funds throughout the EU. Non-EU countries which aim to market alternative funds in Europe are currently required to comply with each EU countries’ national regime.
It its advice, Esma stated that there are no significant obstacles impeding the application of the AIFMD passport to Canada, Guernsey, Japan, Jersey and Switzerland.
With regard to Hong Kong and Singapore, it specified that while there were no significant obstacles to the introduction of the passport, Esma noted that both Hong Kong and Singapore operate regimes that facilitate the access of Ucits from only certain EU member states to retail investors in their territories.
Similarly, with regard to Australia, Esma added that passporting would be possible provided the Australian Securities and Investment Committee (ASIC) exteneded to all EU member states the ‘class order relief’, currently available only to some EU member states, from some requirements of the Australian regulatory framework.
In the case of the US, Esma distinguished between funds marketed which do or don’t involve a public offering, warning that a public offering could generate an un-level playing field between EU and non-EU AIFMs.
Esma stated that it was unable to give specific advice on Bermuda and the Cayman Islands as both countries were in the process of implementing new regimes, Esma delayed further advice until the final regime was in place.
Commenting on the Isle of Man, Esma stated that the absence of an AIFMD-like regime made it difficult to assess whether the investor protection criterion was met.