The European Securities & Markets Authority has updated its questions and answers on the application of the Alternative Investment Fund Managers Directive. The latest update includes 4 new questions:

Section II: Notifications of Alternative Investment Funds

Q6: “An AIF is marketed in a host Member State by way of the AIFMD marketing passport (Article 32 of AIFMD). A new share class of the AIF is set up, which will be marketed in the host Member State. Should this be regarded as a material change, which would require a new notification pursuant to Article 32? … No. The creation of a share class, which is to be marketed cross-border within an already notified (sub-)fund, does not constitute a material change of the notification.”

Q7: “An AIFM wishes to notify a material change to a notification made to the competent authorities in its home Member State to manage or market an AIF on a cross-border basis (Articles 32(7) or 33(6) of AIFMD). Does the AIFM have to include the full set of documentation required by Articles 32 or 33 in the notification letter? … Yes. Material changes to existing notifications require the AIFM to hand in a full set of documentation with the revised notification letter. AIFMs are asked to highlight any amendment to the original notification letter and accompanying documentation.

Section VIII: Delegation

Q2: “Where the AIFM does not itself perform the functions set out in Annex I of the AIFMD, does this release the AIFM from its responsibility to ensure compliance of the relevant function(s) with the AIFMD? …No. Where a third party performs a function stated in Annex I of the AIFMD, this function should be considered as having been delegated by the AIFM to the third party. Therefore, the AIFM should be responsible for ensuring compliance with the requirements on delegation set out in Article 20 of the AIFMD and the principle expressed in Article 5(1) of the Directive according to which the single AIFM appointed for an AIF is responsible for ensuring compliance with the AIFMD. For the avoidance of doubt, this applies to all functions stated in point 1 and point 2 of Annex I of the AIFMD.”

Q3: “Can an externally-managed AIF itself perform the investment management functions set out in point 1 of Annex I or functions set out in point 2 of Annex I of the AIFMD or would it be possible that the external AIFM delegates the performance of these functions to the governing body or any other internal resource of the externally-managed AIF? … No. Externally-managed AIFs are not regulated as AIFM. The performance of the functions stated in Annex I of the AIFMD is only permitted for AIFs which are internally- managed pursuant to Article 5(1)(b) of the AIFMD. Where the AIF appoints an external AIFM pursuant to Article 5(1)(a), the external AIFM is through its appointment as AIFM of the AIF responsible for providing the functions stated in Annex I of the AIFMD. The external AIFM may delegate to third parties the task of carrying out functions on its behalf in accordance with Article 20 of the AIFMD. The AIF is, however, not a ‘third party’ in accordance with Article 20(1) of the AIFMD.

In case it helps, here’s Annex I from the Directive:


Investment management functions which an AIFM shall at least perform when managing an AIF:


portfolio management;


risk management.


Other functions that an AIFM may additionally perform in the course of the collective management of an AIF:




legal and fund management accounting services;


customer inquiries;


valuation and pricing, including tax returns;


regulatory compliance monitoring;


maintenance of unit-/shareholder register;


distribution of income;


unit/shares issues and redemptions;


contract settlements, including certificate dispatch;


record keeping;




Activities related to the assets of AIFs, namely services necessary to meet the fiduciary duties of the AIFM, facilities management, real estate administration activities, advice to undertakings on capital structure, industrial strategy and related matters, advice and services relating to mergers and the purchase of undertakings and other services connected to the management of the AIF and the companies and other assets in which it has invested.