FCA encourages firms to submit AIFMD authorisation applications now

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Firms operating within the sector will already be aware that implementation of the Alternative Investment Fund Managers Directive (AIFMD) is subject to a one-year transitional period, ending on 22 July 2014. On 19 December 2013, the Treasury announced changes to the transitional provisions in place. As a result, firms already managing Alternative Investment Funds (AIFs) are able to continue managing AIFs, even if they have not submitted authorisation applications in time for determination by the FCA. As long as a complete application has been submitted by 22 July 2014, the Treasury’s provision allows management activities to continue.

However on 1 April 2014, the FCA updated its AIFMD Latest News. The regulator is still advising firms to submit applications as soon as possible; ideally no later than 22 April 2014.

WM Comment

Firms may have considered deferring an authorisation application until the end of the transitional year in light of the Treasury announcement. However, it is important to remember the possible consequences. Firms managing AIFs without the necessary authorisation on 22 July 2014:

  • must be fully compliant with all relevant AIFMD requirements by this date
  • will be expected to engage the services of a depository (if applicable)
  • cannot passport activities into other EEA member states until authorisation is received and the notification processed
  • could risk interruption of their business if their application is deficient or incomplete and, as a result, authorisation cannot be granted

For more advice, contact Walker Morris Regulatory Team partner Andrew Northage.