AIFMD - Challenges and Opportunities

Dr. Maria Chetcuti Cauchi | 23 Aug 2016

AIFMD  Challenges and Opportunities

Malta is a well established funds domicile, with hundreds of fund managers choosing the country as a jurisdiction for their funds. Malta funds are in fact an important contributor to the Maltese economy. The Alternative Investment Fund Managers Directive ("AIFMD") is expected to have an impact on the Malta fund industry as with the alternative fund industry in general.

With the various challenges brought about by the added regulatory burden imposed by the AIFMD, the opportunities will undoubtly follow. Malta already had a sound and sophisticated regulatory regime for funds and fund managers, and the AIFMD therefore did not have a significant impact on the local funds industry, even though it did raise some infrastructural challenges. The pre-AIFMD Malta funds product, the Professional Investor Fund ("PIF"), was in fact, already subject to many of the rules which the AIFMD sought to implement. Due to the sucess of the PIF regime, Malta opted to retain such product for de minimis fund managers and non-EU AIFMs. Malta has also launched a new Alternative Investment Fund ("AIF") regime for EU AIFMs.

Furthermore, the passporting rights introduces by the AIFMD do serve to enhance Malta's attractiveness as a domicile of alternative funds and their managers, giving Malta domiciled fund managers easier access to the European market. Malta is also a party to the AIFMD compliant agreements negotiated by ESMA with third country regulators.  

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