Co-authored by Tim Aron.

On December 19, the European Commission adopted a Delegated (Level 2) Regulation (Delegated Regulation) implementing certain aspects of the Alternative Investment Fund Managers Directive (2011/61/EU) (AIFMD).

The Delegated Regulation contains rules supplementing the AIFMD in a number of key areas including:

  • Conditions and procedure for the authorization of Alternative Investment Fund Managers (AIFMs);
  • Calculation of leverage;
  • Operating conditions for AIFMs, including rules on conflicts of interest, risk management, liquidity management, organizational requirements, valuation and delegation of AIFM functions;
  • Depositary tasks and liabilities;
  • Transparency requirements towards investors and regulators; and
  • Cooperation agreements with third countries.

The Delegated Regulation is subject to a three-month scrutiny period by the European Parliament and the European Council of Ministers. Provided no objections are raised, the Delegated Regulation will enter into force 20 days after its publication in the Official Journal of the European Union, and will apply from July 22, 2013.

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