The European Securities and Markets Authority (ESMA) has published advice regarding the application of the Alternative Investment Fund Managers Directive (AIFMD) passport to non-EU Alternative Investment Fund Managers (AIFMs) and Alternative Investment Funds (AIFs) (2015/ESMA/1236).

The passport is currently only available to EU entities. ESMA’s advice relates to the possible extension of the passport to non- EU AIFMs and AIFs (currently subject to EU National Private Placement Regimes (NPPRs)).

ESMA conducted a country-by-country assessment which allowed it flexibility to take into account the different circumstances of each non-EU jurisdiction regarding the regulatory issues to be considered. These included investor protection, competition, potential market disruption and the monitoring of systemic risk.

ESMA assessed six jurisdictions, namely Guernsey, Jersey, Hong Kong, Singapore, Switzerland and the US, which were selected based on a number of factors, including:

  • the amount of activity already being carried out by entities from these countries under the NPPRs;
  • EU national authorities’ knowledge and experience of dealing with their counterparts; and
  • the efforts by stakeholders from these countries to engage with ESMA’s process.

The advice concludes that no obstacles exist to the extension  of the passport to Guernsey and Jersey, while Switzerland will remove any remaining obstacles with the enactment of pending legislation. No definitive view has been reached on the other three jurisdictions due to concerns relating to competition, regulatory issues and a lack of sufficient evidence to properly assess the relevant criteria.

ESMA aims to finalise the assessments of Hong Kong, Singapore and the US as soon as practicable and to assess further groups of non-EU countries until it has provided advice on all the non-EU countries that it considers should be included in the extension of the passport. For those non-EU jurisdictions with which there are currently no supervisory co-operation arrangements in place for the purposes of the AIFMD, ESMA will continue its efforts to agree a MoU with the authorities concerned.


The European Securities and Markets Authority (ESMA) has published an opinion and responses to the call for evidence on the functioning of the AIFMD passport and of the National Private Placement Regimes (NPPRs) (2015/ESMA/1235).

The opinion contains feedback on the surveys conducted by ESMA on the AIFMD passport followed by ESMA’s preliminary assessment of the operation of the two mechanisms.

ESMA’s preliminary view is that, given the short time period which has elapsed since the implementation of the AIFMD in Member States, a definitive assessment of their functioning is difficult. ESMA recommends preparing a further opinion after a longer period.


The European Securities and Markets Authority (ESMA) has published a consultation paper (ESMA/2015/1239) on draft regulatory technical standards (RTS) under the Regulation  on European Long-Term Investment Funds ((EU) 2015/760) (ELTIF Regulation).

In line with the ELTIF Regulation, ESMA is consulting on draft RTS to determine the criteria for establishing the following:

  • circumstances in which the use of financial derivative instruments solely serves hedging purposes;
  • circumstances in which the life of an ELTIF is considered sufficient in length;
  • criteria to be used for certain elements of the itemised schedule for the orderly disposal of the ELTIF assets;
  • costs disclosure; and
  • facilities available to retail investors.

This consultation paper represents the first stage in the development of the draft RTS and sets out proposals for their content on which ESMA is seeking the views of external stakeholders.

The deadline for responses to the consultation is 14 October 2015. Responses to this consultation paper will help ESMA in finalising the draft RTS to be submitted to the European Commission for endorsement.

ELTIFs are designed to increase the amount of non-bank finance available for companies investing in the EU. They are also intended to enable investors to put money into companies and infrastructure projects for the long-term. As such, ELTIFs are an important element of the efforts being put in place at European level to boost long-term investments.