24 June 2019€¦ · Key Investment Trends European Market 1. Multi-asset is a significant...

2irishfunds.ie

24 June 2019

Irish Funds Hong Kong Seminar

irishfunds.ie

Event Host

Conor O’Mara

Welcome Remarks

Managing Director, Jefferies

Paul Moloney

Partner, Eversheds Sutherland

Distribution Update

Eversheds Sutherland | June 2019 |

European Distribution Overview

6

Based on the presentation given by Paul Hefferman, HSBC


Key Investment Trends

European Market

1. Multi-asset is a significant investment space and permeates those individual, country

asset class preferences

– Funds are either being marketed as a component of a traditional or alternative, multi-

asset discretionary portfolio and/or on a stand-alone basis

– Significant rise in the number of multi-manager, fund-of-funds and risk-rated outcome

fund launches within the industry to meet investor demand in a post-MIFID II

environment where rebates are no longer the norm

2. Fund selectors and other institutional fund buyers are key

– They account for more than 90% of the European asset pool invested in funds

– It’s all about business-to-business in terms of their underlying buying behaviors

3. B2B investment fund platforms are important access points

– Asset under administration on B2B platforms reached €2.4 trillion at the end of 2017

– Expected to grow to €4.3 trillion by 2021 (45% of total assets currently)

– This growth is coupled with a wave of rapid consolidation


Key European Distribution Channels

Source: Irish Funds 2018


DEFINITIONS (eVestment Advantage Viewership Report – December 2018)

• Top by Increase: products, firms, and universes with the largest increase in the proportion of views they captured in the most recent month compared to the proportion of views they received in the

prior six months

• Top Viewed: the most viewed products, firms, and universes by institutional investors and consultants in the most recent month

• Top by Average Views Per Product : universes with the highest average number of views per product; universes must have more than one product reviewed for inclusion

Institutional Insights- UK Investors &

Consultants



Institutional Insights - Europe ex UK Investors &

Consultants

DEFINITIONS (eVestment Advantage Viewership Report – December 2018)

• Top by Increase: products, firms, and universes with the largest increase in the proportion of views they captured in the most recent month compared to the proportion of views they received in the prior six months

• Top Viewed: the most viewed products, firms, and universes by institutional investors and consultants in the most recent month

• Top by Average Views Per Product : universes with the highest average number of views per product; universes must have more than one product reviewed for inclusion



Sustainable & Responsible Investment -

Several Approaches

Approach Concept

Sustainable

(‘best-in-class’)Selection of the best companies/issuers in their sector with regard to sustainable development

ThematicSelection of the best companies/issuers according to a specific sustainable development theme (e.g.

renewable energies, eater treatment, etc.)

Engagement

Voting at general meetings….Dialogue with companies….Shareholder action/lobbying…

Engagement adds an extra overlay to other sustainable & responsible investment approaches or

traditional management

NormativeSelection of companies/issuers according to their observance of the main international treaties (e.g.

Conventions of the International Labour Organisation, etc.)

EthicalExclusion of companies/issuers involved in controversial activities (e.g. alcohol,

gambling, animal testing, etc.)

Solidarity

Solidarity Funds: Investment in solidarity projects / Microcredit funds

Sharing Funds: Payment of all of some of the income / management fees / subscription fees to

charitable organsiations


Source: EFAMA International Statistical Release – Q3 2018

Global Industry (Q3 – 2018)

RESTRICTED

19.9

17.2

0.1

1.5

11.17.6

42.7

Bond Balanced-Mixed

Guaranteed Real Estate

Money Market Other

Equity

Worldwide Regulated Open End Funds Net Assets – By Asset Class

Worldwide regulated open-ended fund assets increased by 2.1% to

€46.64 trillion in Q3 2018

Worldwide net cash flow to all funds amounted to €169 billion

Americas, $25.13Europe,

$15.58

Asia and Pacific, $5.75

Africa, $0.17

Americas Europe Asia and Pacific Africa

$46.64

Trillion

Worldwide Funds Net Assets – By Geography

Eversheds Sutherland | June 2019|

European Asset Management Industry – Q3

2018

13

LatAm

3%

Other

7%

APAC

13%

€16 Trillion Industry

UCITS €10 Trillion AIF €6 Trillion

European Managers – 56% of AssetsUS Managers

30% of Assets

ROW – 14%

of Assets

Cross Border - Sourced 77% of Assets from Europe

Industry Scale

Product Breakdown

Manager Origin

Source Of Flows

Italy

23%Switzerland

17%

Germany

12%

UK

11%

Spain

7%

Rest

30%

Europe 77%Global Breakdown

European Breakdown

Distribution1994 269 funds registered for sale in 5 or More countries

201812,607 funds registered for sale in 5 or

More countries

0.00 1.00 2.00 3.00 4.00 5.00 6.00

Ireland

Luxembourg

Germany

France

Rest of Europe

European Breakout

UCITS AIF

Irish Investment Funds Industry?

• Over 900 fund managers from 50+ countries

• Servicing €4.4 Trillion in total AuA (€2.4 Trillion in Irish Domiciled)

• Distribution to 70 Countries

• 30 languages and 28 currencies fully supported.

• Look at some of the names that are already here


Where is the money coming from?

14

- Biggest Outflows in Q3 2018

- Europe – France (-€8.3bn), UK (€-5.05bn)

- Americas – Argentina (-€4.53bn), Chile (-€2.9bn)

- Asia – China (-€35.73), India (-€10.83bn)

- Biggest Inflows in Q3 2018

- Europe – Germany (€19.79bn), Ireland (€18.73bn)

- Americas – US (€113.49)

- Asia – Japan(€35.23)

€0

€50,000

€100,000

€150,000

€200,000

€250,000

€300,000

2017 Q1 2017 Q2 2017 Q3 2017 Q4

€145,475 €152,274

€215,885

€271,159

€115,760

€137,876

€181,121

€98,057

€247,731€234,361 €238,818

€178,281

MIL

LIO

NS

OF

EU

RO

Net Sales Globally 2017

United states Asia & Pacific Europe

-€20,000

€0

€20,000

€40,000

€60,000

€80,000

€100,000

2018 Q1 2018 Q2 2018 Q3

€53,942

€26,628€18,763

€76,602

€14,742€11,365

€89,083

-€16,229

€15,277

European Flows - 2018 YTD

Ireland Luxembourg Rest of Europe


Largest Promoters of Irish Domiciled Product

15

Top 25 Irish Domiciled Structures

Scheme & Umbrella Name Promoter/Initiator Legal Status US$ TNAV 30-Jun-

18

PIMCO Funds: Global Investors Series plc PIMCO UCITS $159,958,046,795

Institutional Cash Series plc Blackrock UCITS $144,637,525,241

Goldman Sachs Funds plc Goldman Sachs UCITS $103,663,133,447

Vanguard Investment Series plc Vanguard Group UCITS $86,790,599,272

iShares plc Blackrock UCITS - ETF $82,376,343,878

LDI Solutions Plus ICAV Insight Investment AIF $62,679,291,437

iShares III plc Blackrock UCITS - ETF $58,537,128,560

LGIM Liquidity Funds plc Legal & General UCITS $47,538,488,796

iShares VII plc Blackrock UCITS - ETF $47,454,167,249

iShares II plc Blackrock UCITS - ETF $46,470,980,400

LGIM (Ireland) Risk Management Solutions plc Legal & General AIF $43,467,991,062

Insight Liquidity Funds plc Insight Investment UCITS $43,134,876,328

Vanguard Funds plc Vanguard Group UCITS - ETF $38,934,790,846

BlackRock Index Selection Fund Blackrock UCITS $38,906,407,360

HSBC Global Liquidity Funds plc HSBC UCITS $37,715,583,839

Aviva Investors Liquidity Funds plc Aviva Investors UCITS $35,892,291,838

MGI Funds plc Mercer Global Investments UCITS $34,407,502,530

Mercer QIF Fund plc Mercer Global Investments AIF $32,888,771,283

State Street Global Advisors Liquidity plc State Street UCITS $31,368,782,483

Marshall Wace Investment Strategies Marshall Wace AIF $29,342,963,667

Legg Mason Global Funds plc Legg Mason Group UCITS $29,146,420,764

Northern Trust Global Funds plc Northern Trust UCITS $26,582,716,005

GAM Star Fund plc GAM UCITS $26,318,975,214

Mercer QIF CCF Mercer Global Investments AIF -CCF $25,457,208,599

Standard Life Investments Liquidity Fund plc Standard Life Aberdeen UCITS $25,258,024,366

Top 25 Promoters with Irish Domiciled Product

Promoter US$ TNAV 30-Jun-18

Blackrock $562,392,230,024

PIMCO $179,133,996,236

Vanguard Group $132,158,412,043

Insight Investment $128,076,092,017

Goldman Sachs $111,298,486,310

Mercer Global Investments $97,835,737,881

Legal & General $97,606,542,606

State Street $80,610,527,811

HSBC $45,157,415,929

Deutsche Asset Management $44,001,427,626

Russell Investments $43,158,218,882

Northern Trust $41,456,899,657

Mediolanum $41,062,472,622

Aviva Investors $35,892,291,838

Marshall Wace $34,708,933,708

Standard Life Aberdeen $34,612,212,175

Barings $34,019,126,034

Invesco $32,982,306,761

Legg Mason Group $32,053,920,268

UBS $28,378,112,686

GAM $26,396,638,922

M&G $25,842,034,909

Hewitt Risk Management Services $25,503,767,099

Old Mutual $25,337,781,101

Neuberger Berman $25,000,141,999

Source: Monetary Ireland Fund Report 2018


Greater China – Promoters in Ireland

Source: Monterey Ireland Fund Report 2018 (June 18 Data) – Promoters/Initiators domiciled in Greater China


What Investors Want? – Alternatives?

17

• Alternatives are rapidly becoming mainstream, with over $8trillion in Alternative assets Globally

• PwC’s 2017 report: “Asset & Wealth Management Revolution: Embracing Exponential Change” -

Estimate that Alternatives will account for 15% of Global AUM by the year 2025 (Reference Graph)

• Investment in multiple alternative asset classes is now the norm for institutional Investors

• Funds are moving to onshore jurisdictions with strong tax transparency and regulatory infrastructure

– Ireland has been a strong recipient of open ended liquid funds holding liquid strategies like hedge

funds and liquid alternatives.

– Luxembourg tends to be the go to for illiquid funds (closed ended commit and contribute fund

structures), such as buy and hold private equity and real assets including real estate and

infrastructure.

0

10

20

30

2018 2025

PR

OJE

CT

ED

AU

M

IN

TR

ILL

ION

S

YEAR


UCITS

18Ref: Irish Funds

Passporting


Notification procedure

AIFMDPassporting

• Status of Fund: Standalone, sub-fund or umbrella

• Name of the fund and domicile

• Following details of the AIFM:

– Management of AIFs (portfolio management & risk management)

– Management of portfolios of investments, including those owned by pension funds and institutions for occupational retirement provision in accordance with Article 19(1) of Directive 2003/41/EC, in accordance with mandates given by investors on a discretionary, client-by-client basis.

– Investment Advice

– Safekeeping and administration in relation to units of collective investment undertakings

– Reception and transmission of orders in relation to financial instruments

19


Fund Raising in Europe

20


Overview of the Alternative Investment Managers’

Directive – A Distribution Perspective

• AIFMD provides a framework for harmonising the management

and marketing of Alternative Investment Funds (“AIFs”) (i.e. all

“collective investment undertakings” other than EU UCITS

funds) in the European Union (“EU”).

• The options for non-EU AIFMs raising capital from EU

investors are:

– Rely on “Reverse Solicitation”;

– Register country by country under the national private placement rules

(“NPPRs”); or

– Set up an EU AIF and an EU manager in order to obtain the right to

“passport” into all 28 EU jurisdictions Engage a 3rd party AIF and/or

AIFM ‘platform’ in order to obtain the right to “passport” in all 28 EU

jurisdictions.

– Engage a 3rd party AIF and/or AIFM ‘platform’ in order to obtain the

right to “passport” in all 28 EU jurisdictions.

21


Reverse Solicitation

• In EU, reverse solicitation (or reverse enquiry) is not

unanimously defined, nor is there a detailed guidance in

relation to this area.

• However it is not considered “marketing” under AIFMD.

Responding to unsolicited enquiries from investors in EU

and/or following up with information memoranda and

subscription documents will not trigger an obligation to register

under AIFMD, in contrast with active “marketing.

• Examples for some jurisdictions’ guidance on when reverse

solicitation can be relied on include when the solicitation is

specific to the fund in question, rather than a general approach

to the manager. Note that however different EU states may

have different standards towards the acceptability of reverse

solicitation.

22


Reverse Solicitation• ESMA recently published a proposal for a new Directive:

– unless a fund is registered in the relevant jurisdiction, any investor who is approached on

a ‘pre-marketing basis’ may never be admitted to any fund of that manager which has the

same or a similar investment strategy.

– This would only apply to EU AIFMs but it would be expected that many EU states would

apply a similar interpretation to non-EU AIFMs also.

• Given its limited scope, EU regulators will not tolerate a situation where the regulatory

protections they have implemented are being ignored.

• Reverse solicitation requires that there has been no direct or indirect solicitation by or on

behalf of the AIFM. Procedures (e.g. materials on website) must be in place and records

should be kept to ensure:

– promotion has not be taken in a way which would trigger an enquiry

– how the investors first contacted the AIFMs and how they came to make an investment in certain funds are

properly recorded, in response to EU regulators’ increasing concerns

– investors are asked to sign a declaration that the investment was made on foot of an unsolicited enquiry from

them.

• Reverse solicitation therefore has significant limitations, is not a ‘marketing strategy’ and

should be considered on a case by case basis. The evidential burden will be on the AIFM

and there are criminal sanctions and fines for non-compliance and investors effectively have

a “free option” if they were illegally approached and lost money.

23


Reverse Solicitation

24

Country Official guidance Must be Product

specific?

Other

marketing

allowed?

Separateenquiry for each

transaction

Significant problems

Belgium No Yes Yes Yes

Denmark No No No No

Finland No No No Yes

Germany Yes Yes Yes Yes

Netherlands No Yes Yes Yes

Spain No No No No

Sweden No Yes Yes No

Proceed with caution, restrictions

apply

Austria No Yes Yes No

France Yes Yes Yes No

Norway No Yes Yes No

SwitzerlandYes Yes Yes No

No issues

Ireland No No Yes No

Italy No No Yes No

Luxembourg No No Yes No

UK Yes No Yes No


Pre-Marketing

25

• “Pre-marketing” is generally considered to refer to activities

which fall short of making a formal offer to potential investors –

e.g. by presenting offering memoranda, subscription

documents or other materials which would allow investors to

make a decision to invest or to actually do so.

• The UK regulator, the Financial Conduct Authority (FCA), has

stated that arranging meetings and undertaking other activities

merely to sound out investor enthusiasm for a proposed

product, including handing over/circulating presentations and

other materials does not technically constitute “marketing”

under AIFMD as “marketing” triggers a filing obligation under

AIFMD and such filings can only be made once a final offer

document is available.


Pre-Marketing

26

• Information provided to an investor in the pre-marketing phase must not:

– Relate to or contain reference to an existing fund;

– Enable investors to make a commitment of investing in a particular fund;

or

– Amount to a prospectus, constitutional documents of a not-yet-established

AIF, offering documents, subscription forms or similar documents allowing

investors to take an investment decision, regardless whether in a draft or a

final form.

• Therefore, by circulating to or negotiating a draft term sheet/partnership

agreement/PPM with potential investors, a draft partnership agreement or

PPM may trigger a “marketing” notification.

• Apart from fully authorised EU AIFMs (and EuVECA and EuSEF managers)

which pre-marketing is permissible, whether the conditions under which pre-

marketing is permissible for non-EU AIFMs and sub-threshold EU AIFMs is

uncertain.

• General industry views hope for a final Directive which is less onerous than

the draft proposals so as to reduce the impact for how AIFs are promoted

currently.


Pre-Marketing

27

Country Official

guidance

Pre-offer

documents

allowed?

Type of investor who can be approached

Significant

problems

Austria Yes No N/A

Belgium No No N/A

France YesYes but only in

very limited

circumstances.

1. Professional investment managers in the

context of a portfolio management agreement

for a third party, provided that such financial

instruments are allowed/authorised in the

management of the portfolio of the investor;

2. French funds provided that such financial

instruments are allowed to be included in the

assets of the AIF. So in practice pre-marketing

in very restricted.

Ireland No No N/A

Italy No No N/A

Norway No No N/A

Spain No No N/A


Pre-Marketing

28

Country Official

guidance

Pre-offer

documents

allowed?


Proceed with

caution,

restrictions apply

Denmark NoYes but very

restricted

Professional investors as defined under MiFID; or to persons

permitted under private placement rules if closed end fund being

broadly, professional institutional investors; offerings with a

minimum commitment per investor of at least EUR100,000 and

offerings to less than 150 individuals (other than qualified investors)

in Denmark.

Luxembourg No Yes

Closed ended funds they must comply with the Luxembourg regulator of

the financial sector (“CSSF”) requirements under AIFMD and

Luxembourg’s prospectus rules:

• the offer is made to EU professional investors (as defined under annex

II of directive 2004/39/EC (MiFID));

• the securities have a high nominal amount (equivalent or in excess of

EUR 125,000);

• the offer is made to a small circle of persons (the CSSF will consider

cases on an individual basis, there is no maximum number of

investors to fulfil the criteria)

• the form of the offer must be appropriate - e.g., targeting existing

customers, high sales amount, no general advertising; The CSSF

requires to be informed in advance of the marketing of any closed

ended AIF by an EU AIFM within Luxembourg territory.

Sweden No

Yes but provided

the AIF does not

exist

Professional investors as defined under 2007 Swedish Securities

Market Act.

Switzerland Yes

To 'regulated qualified investors’; and ‘unregulated qualified

investors’ provided a Swiss representative and paying agent is

appointed in the case of ‘unregulated qualified investors’.


Pre-Marketing

29

Country Official

guidance

Pre-offer

documents

allowed?


No Issues

Finland No

Yes but no

offering

memoranda or

subscription

agreements

Professional investors as defined under MiFID

Germany Yes Yes

Professional investors as defined under MiFID;

marketing to semi- professional investors can only

take place once there is a fully AIFMD-compliant

AIFM.

Netherlands No Yes

• Professional investors as defined under MiFID; and

• For closed ended funds, other persons subject to a

minimum commitment per investor of at least EUR

100,000 and offerings to less than 150 individuals (other

than professional investors) in the Netherlands.

UK Yes

Yes subject to

compliance with

UK 'financial

promotion' rules.

Professional investors, large corporations and

‘sophisticated’ and

other qualifying individuals if marketed by an FCA

authorised firm.


The National Private Placement Regimes

30

• AIFMD does not implement a harmonised regime for privately

placing AIFs in the EU.

• Rather, each Member State is permitted to retain its own

domestic rules which means it is necessary to consider and

take advice country by country as to what forms and methods

of marketing are permitted.

• AIFMD does impose a harmonised obligation, however, to

register non-EU AIFs marketed by EU and non-EU AIFMs to

EU investors in each EU state and to comply with various

information and ongoing reporting obligations.


The National Private Placement Regimes

31

• Other jurisdictions, however, only allow marketing to commence after a specified period. A number of the Nordic countries have followed this route. While the applications are not unduly cumbersome, approval can take several months to achieve, thus potentially impacting upon marketing and closing timetables.

• Some jurisdictions, although of a small number, have introduced significant additional requirements. Examples include Austria, Denmark and Germany. On top of custodial type obligations, these countries also require the appointment of a depository to the AIF with regulatory oversight responsibilities, which may lead to substantial operational cost increase.

• Some jurisdictions effectively ban private placements of non-EU ‘unregulated’ funds including Italy, France and Spain.

• Some non-EU AIFMs tend avoid marketing in the EU completely or restricting marketing to a very small number of jurisdictions, typically the U.K., the Netherlands and the non-EU country Switzerland, as a result of:– initial and ongoing cost of registering state by state,

– complying with national reporting obligations and

– the inability to access investors in certain countries at all.

• On the other hand, other non-EU AIFMs are forming EU AIFs and EU AIFMsor ‘outsourcing’ to third party platforms offering EU AIFs and/or EU AIFMfacilities.


AIFMD National Private Placement Regimes

32

Country Marketingeffective immediately?

Gold plating? Fees

Significant problems

Austria No - up to 4 monthsYes – full depo and local legal agent.

• Application fees: EUR 4,500

• Annual supervision fee: EUR

2,500 pa

Denmark NoYes –depo lite and additional publication

requirements. Closed ended funds may also be

subject to prospectus regulations.

• Application fees: DKK 5,000

• Annual supervision fee: DKK

5,000 pa

France No

Yes. Non-AIFM must comply with same

regulations as EU AIFM. Non-EU open ended

funds generally cannot comply with French

rules on equivalency. Must appoint a local

agent to deal with subscriptions and

redemptions.



2,000 pa

• Local agent EUR 2,000

Germany No – up to 5 months

Yes - depo lite; evidence of how marketing

will be conducted to avoid retail;

appointment of local tax agent. Non-EU AIFM

must be regulated on home state.



6,852 pa

Italy No Yes – non-EU AIFMs cannot market in Italy. N/a

Spain NoYes. Significant additional information required

by CNMY regarding ‘equivalency’ of non-EU

jurisdiction.

EUR 1,800 – 72,000 (for umbrellafunds)



33


Gold plating? Fees

Proceed with

caution,

restrictions apply

Finland YesYes. Additional publication and auditrequirements.

• Application fees: EUR 2,600• Annual supervision fee: EUR

2,600 pa

Norway NoYes. Non-EU AIFM must beregulated in homestate.

• Application fees: none• Annual supervision fee: none

Sweden NoYes. Must evidence how marketing will beconducted to avoid retail.

• Up to SEK 16,000

Switzerland Yes

Yes. Marketing restricted to 'regulatedqualified investors’; "unregulated qualifiedinvestors can only be approached if a Swissrepresentative and paying agent is appointed.

• Swiss rep: SFR 8,500 – 12,500• Paying agent: SFR 1,500

Eversheds Sutherland | June 2019 | 34


Gold plating? Fees

No Issues

Belgium No No• Application fees: none• Annual supervision fee: none

Ireland Yes No• Application fees: none• Annual supervision fee: none

Luxembourg No No

• Application fees: EUR 2,650 –5,000

• Annual supervision fee: EUR 500 pa

Netherlands No No• Application fees: EUR 1,500• Annual supervision fee: EUR

1,500 pa

UnitedKingdom

YesNo, but UK financialpromotions rules mustbe complied with.

• Application fees:• Full scope - £250• Sub-threshold - £125

• Annual supervision fee: £0-£500 pa



The AIFMD Passport

35

• At present the AIFMD passport option is only open to EU AIFMs managing and marketing EU AIFs.

− While non-EU managers may consider establishing an EU domiciled fund in order to access EU domiciled investors, the requirement to establish an EU AIFM means that for a lot of non EU managers, the costs outweigh the benefits.

− We see most of our non-EU domicilied clients who are establishing an EU domiciled fund utilise the services of third party ManCo's. Essentially the 3rd party operates as the AIFMof the EU fund but delegates management back to the non-EU manager. Under AIFMD an AIFM is permitted to delegate management provided it retains risk management responsibility.

• Some platform providers also offer a fund platform so that external managers can form a separate sub-fund within their platform fund and which can save time and costs.


Extension of the AIFMD Passport to Non-EU

AIFs and AIFMs

− There has been no real progress on extending the AIFMD

passport to non-EU AIFMs and non-EU AIFs.

− The timing of any such extension is very uncertain.

36


Switzerland

37

Switzerland is an important fund raising jurisdiction but as a non-EU country it has its own private placement regime.

• Non-Swiss persons can market to “Tier 1 Qualified Investors" without making any local notifications or registrations etc. Such investors are regulated financial intermediaries such as banks, broker-dealers, fund management companies and asset managers of collective investment schemes (but not asset managers generally) and regulated insurance companies.

• Non-Swiss persons cannot market to ‘retail investors’ and can only market to “Tier 2 Qualified Investors” if they appoint a local paying agent and distributor. Tier 2 Qualified Investors include: (a) Public law corporations, pension funds and corporations, in each case which cash is managed on a professional basis; (b) high net worth individuals who ask in writing to be treated as such (opting in); and (c) high net worth individuals whose assets are managed under a written discretionary mandate with a bank, broker-dealer or fund manager or with an independent asset manager (x) who is a financial intermediary subject to the Swiss Anti-money Laundering Act, (y) who is a member of an SRO approved by the Swiss regulator (FINMA) and (z) whose discretionary asset management agreement complies with the standard issued by the FINMA approved SRO.


Conclusion

38

• It is complex to raise money for ‘alternative investment funds in Europe. managers and placement agents should take professional advice well in advance of making any approaches to European investors to reserve their ability to accept ‘reverse enquiries’ or prevent triggering registrations which could be avoided or delayed

• Intended to be a narrow exemption, reverse solicitation is not a marketing strategy and should be relied upon only in respect of countries where no active marketing is planned

• In several European countries, ‘pre-marketing’ is also not accepted and can trigger registration obligations; where in certain European countries the marketing person will need to comply with local laws, must be a locally licensed institution and/or must be licensed in its home jurisdiction even ‘pre-marketing’ is permissible.

• An AIFMD registration in each country in which such marketing takes place is required. It is essential to ascertain whether such marketing is permitted and the extent of ‘gold-plating’ which may make such marketing very costly and lengthy in terms of time.

• Where compliance with the NPPRs is impossible or impractical in all countries, managers should consider launching an EU based fund of their own or via a third party platform.


Questions?

39

eversheds-sutherland.comThis information pack is intended as a guide only. Whilst the information it contains is believed

to be correct, it is not a substitute for appropriate legal advice. Eversheds Sutherland

(International) LLP can take no responsibility for actions taken based on the information

contained in this pack.

© Eversheds Sutherland 2019. All rights reserved.

21/F, Gloucester Tower

The Landmark

15 Queen's Road Central

Hong Kong

+852 2186 3295

[email protected]

Paul Moloney

Partner

Michelle Lloyd, Maples Group (Moderator)

Caroline Higgins, Northern Trust

Melody He, CSOP Asset Management

Katherine Quinn, BosValen Asset Management

Adeline Tan, Mercer Hong Kong

A deep dive into Distribution

across Europe and Asia

Conor O’Mara

Closing Remarks

Managing Director, Jefferies

irishfunds.ie

Event Host

44irishfunds.ie

24 June 2019

Irish Funds Hong Kong Seminar

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