On 19 January 2016, ESMA published a letter (dated 17 December 2015) it has received from the European Commission relating to the application of the EU passport under the AIFMD to non-EU AIFMs and AIFs.

ESMA published its advice relating to the AIFMD passport in July 2015. See our previous briefing:ESMA’s AIFMD Passport Opinion: Good news for Channel Islands managers, uncertainty for those in the US.

In the Letter, the Commission:

  • endorses ESMA’s country-by-country approach to granting the AIFMD passport to managers and funds established in third countries
  • cautions that the test set out in Article 67 of the AIFMD may result in different outcomes depending on the regulatory and supervisory framework of the third countries in which non-EU AIFMs and funds are established
  • indicates that it will determine this point when a sufficient number of countries have been appropriately assessed
  • invites ESMA to complete the assessment of the USA, Hong Kong and Singapore (the remaining countries selected for the first wave) and Japan, Canada, Isle of Man, Cayman Islands, Bermuda and Australia (the countries selected for the second wave) by 30 June 2016
  • provides a more detailed assessment of the capacity of supervisory authorities and their track record in ensuring effective enforcements, including in those countries looked at in the first wave of countries
  • provides a preliminary assessment of the expected inflow of funds by type and size into the EU from relevant third countries
  • agrees with ESMA's suggestion that it produce another opinion on the functioning of the passport and national private placement regimes once the AIFMD is fully transposed in all member states and there is more experience on the functioning of the framework