Earlier today, the First Chamber of the Dutch Parliament adopted the Amendment Act Financial Markets 2015 (Wijzigingswet financiële markten 2015, the "Amendment Act"). The Amendment Act contains substantive and technical amendments to the Financial Supervision Act (Wet op het financieel toezicht, the "FSA"). The Amendment Act will enter into force on 1 January 2015.
In respect of investment funds the Amendment Act introduces a public register for Alternative Investment Fund Managers (AIFM's) that are subject to the lighter regime, provides for a retail passport for EEA AIFM's, and re-introduces the authority of the Authority for Financial Markets (AFM) to request the court to dissolve an investment fund.
The Amendment Act provides for inclusion in the public register of the AFM of Dutch AIFM's that make use of the lighter regime. Under the lighter regime, a manager is exempted from the license requirement but it does need to comply with certain (ongoing) information requirements. The lighter regime is available to Dutch AIFM's that directly or indirectly manage portfolio's of Alternative Investment Funds (AIF's) whose assets under management do not exceed, in total, a threshold of (i) EUR 100 million or (ii) EUR 500 million, if the AIFM only manages unleveraged AIFs without redemption rights during a period of five years. If a Dutch AIFM also offers units in an AIF to non-professional investors (retail funds) the offer must, in addition to the aforementioned conditions, be made to less than 150 investors or with a value of more than EUR 100,000 per investor. If a Dutch AIFM makes use of the lighter regime it needs to notify the AFM thereof. The AFM already has a register on its website that includes AIFM's that make use of the lighter regime but inclusion currently is on a voluntary basis. As of 1 January 2015 all AIFM's that make use of the lighter regime must be included in this register.
AIFM's that are licensed in their EEA home state may exercise passport rights for management and marketing of AIF's to professional investors in the Netherlands on a services and/or branch basis. Following the Amendment Act, it will also be possible for EEA AIFM's to manage a Dutch AIF that offers units to non-professional investors in the Netherlands and/or to offer units in an EEA AIF to non-professional investors in the Netherlands by means of its passport.
To obtain a passport, the EEA AIFM must notify its home state competent authority, which will send the passport notification to the AFM. Once the EEA AIFM has received the notification from its home state competent authority that it has sent the passport notification to the AFM, the EEA AIFM can manage a Dutch AIF and/or offer units in an EEA AIF that it manages in the Netherlands to both professional and non-professional investors. In the event that an AIFM intends to offer units to non-professional investors in the Netherlands, the AIFM needs to notify the AFM hereof. If an EEA AIFM offers units in an AIF to non-professional investors, the Dutch 'top-up' rules will apply, which are rules concerning the business operations, the information to investors and supervisory authorities, the powers of supervisory authorities, the depository and the proper treatment of investors.
Authority to dissolve
The Amendment Act re-introduces the authority of the AFM to request the court to dissolve an investment fund or to liquidate the assets of an investment fund in certain circumstances. This authority is granted for the purpose of consumer protection and only applies to investment funds of which units have been offered to non-professional investors. The investment fund may be dissolved by the court or the assets of the investment fund may be liquidated by one or more liquidators appointed by the court at the request of the AFM inter alia in the event that (i) the license of the AIFM has been revoked, (ii) the AIF or its AIFM has ceased its activities for a period of more than six months, (iii) the AIF or its AIFM does not comply with the FSA or, (iv) the AIF or its AIFM has not sufficiently given effect to an instruction (aanwijzing) of the AFM.