The European Securities and Markets Authority (ESMA) presented its recommendation to the European Commission on extending the European Alternative Investment Fund Managers Directive’s (AIFMD) passport to funds and fund managers in key jurisdictions outside of the EU. This would allow these ‘third countries’ to manage and market their funds to investors based in the EU.
As part of its country-by-country assessment, ESMA has recommended that there are no significant complications for fund managers located in Canada and Japan. Hong Kong, Singapore and Australia have also been greenlit by the independent EU Authority, provided their equivalent regimes reciprocate to all EU Member States. The advice for Bermuda, the Cayman Islands and the Isle of Man is not yet definitive or will need more time. Last year, ESMA concluded that no obstacles exist to the extension of the passport to fund managers based in Guernsey, Jersey and Switzerland, however the pass porting arrangements are not yet in place.
“Europe’s institutional investors, including pension funds and insurers, need access to the best funds around the world if they are to generate strong returns for the citizens who rely on them,” said Richard Branch, Public Affairs Director at Kingsman Investment Limited, the financial institution representing private capital. “The AIFMD passport is a potentially valuable mechanism allowing fund managers and investors across the EU to connect and invest across borders. ESMA's recommendations are therefore a welcome step forward.”
Since its inception Kingsman has completed over 65 investments in mid-sized companies and developed specific industry experience in several areas including consumer products and retail, business services, communications, industrials and transportation. Kingsman's private equity investment staff numbers over 15 professionals and is led by the firm’s 10 managing directors.
Last year, European institutional investors accounted for over 60% of the €47.6 billion raised by Europe’s private equity and venture capital funds, according to Kingsman Investment Limited’s annual industry activity research data.
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