AIFM Directive
“Definitely. Managers of private equity funds as well as private equity funds of funds fall within the scope of the AIFM Directive. In any case, if they are used over the fund generations (i) more than EUR 100 million with borrowed capital or (ii) Manage EUR 500 million with no leverage and no right to redeem shares within the first five years. However, in private equity constellations, ‘with the use of outside capital’ — and this is important — does not refer to acquisition financing at the level of the target company. What this means in positive terms still needs to be worked out in more detail. Family offices and holding companies, for example, are not included in the scope of application. Even if one falls outside the scope, however, it will be important to closely monitor the extent to which the AIFM criteria become accepted as a seal of approval and, on the other hand, this creates a sub-segment of PE funds that may no longer be so easy to place with institutional investors.”
“Unlike EU regulations, EU directives are not directly legally effective and binding. They must first be implemented by national laws, which is also expected in Germany in the second quarter of 2013. In case of doubt, however, existing national legal norms must be interpreted in conformity with European law — i.e., where relevant, already in compliance with the requirements of the AIFM Directive.”
“By the end of 2011, the so-called Level 2 measures are to be adopted first: The “technical” implementing measures, which are referred to in almost 100 places in the text of the directive. A discussion draft of the German implementation law should then be available in mid-2012. Having said all that, one thing is certain: fund managers who are about to embark on a fundraising effort should familiarize themselves with the core content of the policy now.”