IRELAND: Central Bank of Ireland Publishes Consultation on Amendments to the AIF Rulebook

Tuesday December 1 2015

On 30 November 2015, the Central Bank of Ireland issued a consultation paper setting out details of proposed policy amendments and technical changes to the AIF Rulebook. The Central Bank’s AIF Rulebook was introduced with effect from 22 July 2013 to coincide with the implementation of the Alternative Investment Fund Managers Directive (‘AIFMD’). The AIF Rulebook consolidated in a single document the conditions which the Central Bank imposes on authorised AIF, their managers (alternative investment fund managers (‘AIFM’) or AIF management companies) and depositaries. A number of proposed amendments have been identified. Many of these are technical in nature while others propose a change to existing policy.

Proposed policy changes include:

• Extending the category of investors who are provided with an exemption from the eligibility criteria and minimum subscription amount required to invest in a Qualifying Investor AIF.
• Amending the reporting requirement which applies to AIF depositories where they provide services to non-Irish AIF.
• Amendments to the capital and reporting requirements which apply to AIFMs and AIF Management Companies.
• Extending the list of requirements from the AIFM Regulations 2013 which apply to Qualifying Investor AIFs with registered AIFMs.
• The alignment of the rules which apply to collateral received by Retail Investor AIFs under an OTC derivative or a repo / securities lending contract and the rules which reference external credit ratings with the rules recently introduced for UCITS.
• Clarification that the requirement to hold minimum capital as eligible assets and in a separate account does not apply to internally-managed AIF.
• The removal of all references to bearer shares in the AIF Rulebook.
• Requirement that AIFMs and AIF Management Companies produce a second set of half-yearly accounts.

Proposed technical changes include:

• Clarification as to which rules apply to Qualifying Investor AIF with non-EU AIFMs.
• Removal of the rule in relation to approval by the Central Bank for changes in direct or indirect ownership of AIFMs.
• Amendments to the rule in relation to approval by the Central Bank for changes in direct or indirect ownership of AIF Management Companies.
• Removal of the rule in relation to Client Asset Requirements issued under the MiFID Regulations where AIFMs propose to hold client asset accounts for processing subscriptions and redemption monies of AIFs.
• Clarification concerning the rules that apply when a Qualifying Investor AIF invests more that 50% in a single unregulated investment fund.
• Clarification as to the rules which apply where AIFs establish subsidiaries.
• Clarity that a Retail Investor AIF which invest in an underlying fund of funds is not subject to the obligation to ensure that the underlying fund of funds does not itself invest more than 30% in other funds.
• Clarity as to the conditions which apply where Retail Investor AIFs create share classes.

Responses to the consultation should be received no later than February 2016.

Click on the link above for further details.