IRELAND: Central Bank publishes Consultation on carrying out duties in accordance with Article 36 of the AIFMD

Monday March 10 2014

The Central Bank of Ireland has published a Consultation Paper regarding the duties of an Irish authorised entity in accordance with Article 36 of Directive 2011/61/EU (‘AIFMD’).

The question which this Consultation Paper deals with is what requirements should apply to manage conflicts of interest where a find administrator proposes to provide administration services and perform the depository duties set out in Articles 21(7) and 21(9), for the same non-EU AIF. The key question addressed is how to mitigate the conflicts of interest which arise in this instance.

The Central Bank proposes to include the following requirements in Chapter 5 – Fund Administrator Requirements – of the AIF Rulebook:

Where a Fund Administrator provides both administration services and any of the services listed in Regulation 22(7) and/or 22(9) of the AIFM Regulations (‘depositary services’) to the same non-EU AIF, it shall:

1. Functionally and hierarchically separate the depository services and the administration services by carrying out the depositary services through a separate subsidiary;

2. Require the individual responsible for managing the subsidiary to report directly to an individual at PCF level within the parent fund administrator; and

3. Advise the Central Bank of the reporting structure which it has put in place.

Click on the above link for the Consultation Paper.