Eleven Years of AIFMD: Lessons Learned

00:37:51
https://www.youtube.com/watch?v=v7i4soiJ6lY

Sintesi

TLDRLa presentació se centra en les actualitzacions i propostes de reforma de la Directiva sobre gestió de fons a la UE. Descriu el marc regulador implantat inicialment el 2013, destacant aspectes de protecció de l'inversor i mitigació de riscs. El ponent explica les propostes clau dirigides a la gestió de la liquiditat, els serveis de depositori, la transparència en la divulgació de l'ESG, i les regulacions en la delegació de gestió de risc i portafoli. S’analitza també el procés de revisió després de la crisi financera de 2008 i el paper que el marc regulador ha tingut en l’estabilitat del sistema financer europeu. La reforma actual destaca per voler alinear-se amb les realitats i expectatives modernes mitjançant ajustos com la implementació d’elements sostenibles i la transparència en el procés de pre-comercialització de fons.

Punti di forza

  • 🔍 Introducció al marc regulador per gestors de fons de la UE.
  • 📅 Història i implementació inicial de la directiva el 2013.
  • 📈 Ressenya de reformes estructurals i de sostenibilitat.
  • 📜 Importància de la transparència i protecció dels inversors.
  • 📝 Ajustos suggerits com a resposta a la crisi financera.
  • 🔄 Canvis proposats a la gestió de la liquiditat i delegació.
  • 🌱 Reformes per integrar criteris de sostenibilitat ESG.
  • 🔗 Millores en la coherència normativa pan-europea.
  • 📊 Revisions sobre supervisió i gestió de riscs.
  • 🔍 Avaluació de l'adaptació del marc a les expectatives modernes.

Linea temporale

  • 00:00:00 - 00:05:00

    La presentació introdueix el tema de la revisió de l’AFMD, destacant les reformes clau des de la seva introducció el 2013. Es fa una breu presentació de temes com les polítiques de remuneració i el control de riscos interns de les inversions.

  • 00:05:00 - 00:10:00

    És mencionada la revisió del 2017, que no es va dur a terme fins al 2019 amb un informe de KPMG. Aquest informe sobre l’AFMD aborda qüestions com el pre-marketing i la falta d’harmonització entre els diferents reguladors nacionals de la UE.

  • 00:10:00 - 00:15:00

    Es discuteixen els aspectes de la regulació SFDR introduïda per harmonitzar les normes de divulgació d’informació ESG per als gestors de fons, requerint que tinguin en compte els riscos de sostenibilitat en les seves decisions d’inversió.

  • 00:15:00 - 00:20:00

    Es tracta la proposta de reforma de la Comissió Europea, que inclou una carta d’ESMA sobre les àrees de millora de l’AFMD. La proposta abasta arranjaments de delegació, gestió de la liquiditat i altres aspectes per millorar la supervisió i estabilitat financera.

  • 00:20:00 - 00:25:00

    La Comissió Europea va seguir diverses etapes des del 2020 per reavaluar i proposar millores a l’AFMD. La proposta s’enfoca en l’origolació de préstecs i la millora dels serveis de custòdia i harmonització en la gestió de liquiditat.

  • 00:25:00 - 00:30:00

    Les eines de gestió de la liquiditat es detallen en un nou annex que proposa la capacitat de l’ESMA per activar o desactivar eines de gestió de liquiditat en circumstàncies especials, buscant una major coherència a la UE.

  • 00:30:00 - 00:37:51

    La conclusió assenyala un impacte generalment positiu de la directiva, però amb necessitat de petits ajustos i canvis per adaptar-la a les realitats i expectatives recents, destacant la creació d'un mercat intern per a fons i la millora de la protecció dels inversors.

Mostra di più

Mappa mentale

Video Domande e Risposte

  • Què tracta la presentació sobre les reformes normatives?

    La presentació discuteix les reformes normatives dels gestors de fons a la UE, incloent propostes per millorar aspectes com la gestió de riscs, la sostenibilitat i la transparència.

  • Quin és l'objectiu principal de la directiva del 2011?

    L'objectiu principal és oferir un marc regulatori coherent per a la gestió de fons a la UE, enfocant-se en la protecció dels inversors i la reducció de riscs sistèmics.

  • Quins canvis van ser introduïts amb el Reglament de Sostenibilitat de 2019?

    El Reglament de Sostenibilitat de 2019 harmonitza les normes de divulgació d'informació ESG per part dels gestors de fons, requerint considerar els riscs i impactes sostenibles.

  • Quina va ser la resposta a la crisi financera del 2008 mencionada en la presentació?

    La resposta va ser la introducció de la directiva del 2011 que buscava una supervisió més efectiva i la reducció de riscs en la gestió de fons.

  • Quina és la proposta de reforma en relació a la delegació dels gestors?

    Es requereix que els gestors notifiquin si deleguen més del que retenen en la gestió del risc o del portafoli, augmentant així la supervisió.

  • Com es tracta la pre-comercialització segons la reforma?

    La reforma defineix clarament la precomercialització i regula les activitats que els gestors de fons poden realitzar abans de comercialitzar oficialment un fons.

  • Quin és l'impacte de la nova regulació sobre la liquiditat dels fons?

    Els gestors de fons han de seleccionar eines de gestió de liquiditat per als fons oberts i reflectir-les en la documentació proporcionada als inversors.

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Sottotitoli
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Scorrimento automatico:
  • 00:00:04
    [Music]
  • 00:00:15
    thank you CL for that for that
  • 00:00:16
    introduction uh now focusing on the uh
  • 00:00:20
    on these these 11 years that I need to
  • 00:00:22
    go through in the next 25 minutes um
  • 00:00:26
    what I intend doing is uh basically
  • 00:00:29
    giving a a brief
  • 00:00:30
    introduction uh on on the directive and
  • 00:00:33
    where we started moving to uh reforms
  • 00:00:37
    which happened even pre 2021 principally
  • 00:00:40
    two of them uh which will come to later
  • 00:00:43
    and then I will be focusing mostly on
  • 00:00:46
    the on the commission proposal uh the
  • 00:00:49
    proposal for reform of the
  • 00:00:52
    fmd and in this in this third part of my
  • 00:00:55
    presentation I will be skimming through
  • 00:00:58
    five main points five main proposals for
  • 00:01:01
    reform um without going too much into
  • 00:01:05
    detail um on on a on a number of them
  • 00:01:08
    because you will have sessions later on
  • 00:01:10
    with Manfred right after mine on uh loan
  • 00:01:13
    origination uh delegation and substance
  • 00:01:16
    and tomorrow we will have a session on
  • 00:01:18
    on loan orig on um the depository
  • 00:01:20
    passport and the depository uh the
  • 00:01:23
    depository mechanisms which are being um
  • 00:01:25
    proposed in the in the reform and there
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    will also be uh
  • 00:01:30
    a whole session on sustainability so the
  • 00:01:32
    the idea of of my presentation today is
  • 00:01:35
    more to set the scene for the detail
  • 00:01:37
    which you will be going into later on
  • 00:01:40
    today and
  • 00:01:42
    tomorrow so starting off with the
  • 00:01:45
    introduction um the afmd as we know is a
  • 00:01:49
    European union-wide regulatory provides
  • 00:01:51
    for European union-wide regulatory
  • 00:01:53
    framework and it was introduced and
  • 00:01:55
    implemented in
  • 00:01:57
    2013 well introduced in 2011 really but
  • 00:02:00
    implemented it came into force in in
  • 00:02:03
    July of
  • 00:02:04
    2013 it sets out rules for fund managers
  • 00:02:08
    around a number of different aspects as
  • 00:02:10
    to how those fund managers should be
  • 00:02:12
    operating in relation to their internal
  • 00:02:14
    organization requirements the way in
  • 00:02:17
    which they are marketing the funds which
  • 00:02:18
    they are managing uh and the manner in
  • 00:02:21
    which they are raising private capital
  • 00:02:23
    and there it goes into quite uh quite
  • 00:02:25
    some detail on uh remuneration policies
  • 00:02:28
    which need to be set up and established
  • 00:02:30
    by by the fund manager uh the manner in
  • 00:02:33
    which uh the the fund manager is
  • 00:02:36
    monitoring the risk of its uh of its
  • 00:02:39
    Investments through the funds that it is
  • 00:02:42
    managing uh several reporting
  • 00:02:44
    requirements uh and more recently there
  • 00:02:47
    is a a sustainability slant also given
  • 00:02:51
    um to to this directive principle
  • 00:02:53
    relating to the disclosure
  • 00:02:56
    mechanisms although the directive does
  • 00:02:59
    not not regulate as such the fund so the
  • 00:03:02
    alternative investment fund the aif but
  • 00:03:05
    it is directive regulating the fund
  • 00:03:08
    manager the
  • 00:03:10
    aifm on the other hand there are a
  • 00:03:12
    number of rules uh in the directive
  • 00:03:15
    itself particularly in relation to two
  • 00:03:19
    points really the manner in which the
  • 00:03:21
    manager is managing that fund and the
  • 00:03:24
    the disclosures which that manager needs
  • 00:03:26
    to make in the in the fund documentation
  • 00:03:29
    to investors and secondly even the
  • 00:03:32
    manner in which the
  • 00:03:34
    depository functions and what role the
  • 00:03:36
    depository plays uh in monitoring
  • 00:03:40
    safekeeping uh and generally doing all
  • 00:03:43
    that is required of him in terms of the
  • 00:03:45
    directive which uh in an indirect manner
  • 00:03:48
    is it is the directive is also impacting
  • 00:03:51
    quite heavily onto the fund
  • 00:03:54
    itself uh
  • 00:03:56
    the main name of the the main names of
  • 00:03:59
    the directive were always as these are
  • 00:04:01
    underlying principles of most uh if not
  • 00:04:04
    all EU legislation which is consumer
  • 00:04:06
    protection so the protection of
  • 00:04:08
    investors by introducing stricter
  • 00:04:10
    compliance around around how and what
  • 00:04:12
    information is disclosed and the removal
  • 00:04:15
    of uh or an attempt at removal of some
  • 00:04:17
    of the systemic risks which funds of a
  • 00:04:20
    certain size can pose uh to the EU
  • 00:04:23
    Financial system to the stability of the
  • 00:04:25
    EU Financial system uh which experienced
  • 00:04:29
    um uh uh some some uh which went through
  • 00:04:33
    a a rough patch during the financial
  • 00:04:35
    crisis from 200 dat onwards for a few
  • 00:04:38
    years and in fact as CL pointed out
  • 00:04:40
    previously this directive was was one of
  • 00:04:43
    the responses uh to the financial
  • 00:04:48
    crisis so in so far as the timeline of
  • 00:04:51
    the directive is concerned as we're
  • 00:04:54
    saying the
  • 00:04:55
    afmd came into force in 2011 it was
  • 00:04:59
    implemented mented though in 20133 well
  • 00:05:01
    or it should have been implemented in
  • 00:05:03
    2013 most EU member states did so uh by
  • 00:05:06
    the deadline some didn't and implemented
  • 00:05:08
    it much later but those were exception
  • 00:05:11
    the exception not the ru uh in
  • 00:05:15
    2017 a review clause in the directive
  • 00:05:17
    should have been triggered um triggering
  • 00:05:20
    off really the uh revisiting of the of
  • 00:05:23
    the directive and this should have
  • 00:05:25
    started in July 2017 for a number of
  • 00:05:28
    reasons uh this didn't happen and uh the
  • 00:05:31
    review really started with a um a report
  • 00:05:35
    commissioned um to KPMG which was
  • 00:05:38
    brought in to assess the directive
  • 00:05:40
    against principles of Effectiveness
  • 00:05:41
    efficiency coherence relevance and added
  • 00:05:45
    value uh the report was published by
  • 00:05:47
    KPMG in January of
  • 00:05:49
    2019 we'll come later now we'll pick on
  • 00:05:53
    uh what happened after that because a
  • 00:05:55
    number of different um steps were taken
  • 00:05:58
    by esma by the commission and more
  • 00:06:00
    recently until yesterday documents kept
  • 00:06:02
    on being issued by the European
  • 00:06:04
    Parliament uh just to bring you up to
  • 00:06:06
    speed as much as I can on on the on the
  • 00:06:09
    eer so far of the of the process however
  • 00:06:13
    going back a step and going through what
  • 00:06:18
    occurred prior to the 2021 publication
  • 00:06:22
    of the reform proposal uh so as a first
  • 00:06:25
    step we had uh even at the at Inception
  • 00:06:28
    since 200
  • 00:06:30
    13 we had a a bit of an issue around uh
  • 00:06:34
    what is pre-marketing so one of the of
  • 00:06:36
    the torny tny issues on which we as
  • 00:06:40
    lawyers were being asked to issue legal
  • 00:06:41
    opinions and to give advice but we were
  • 00:06:44
    sometimes a bit lost in view of the
  • 00:06:46
    diverging interpretations of the rules
  • 00:06:49
    by national
  • 00:06:51
    Regulators uh as to what constituted
  • 00:06:54
    what constituted the activity of
  • 00:06:56
    marketing uh of a fund now this was uh
  • 00:07:01
    addressed uh eventually uh through um
  • 00:07:06
    legislative legislative Intervention
  • 00:07:08
    basically new uh EU rules were were
  • 00:07:11
    introduced regulating the pre-marketing
  • 00:07:13
    of aifs which were published in July of
  • 00:07:16
    2019 and came into force in August of
  • 00:07:19
    2021 um so what is uh what was
  • 00:07:23
    pre-marketing before the issuance of the
  • 00:07:25
    rules was a matter of interpretation now
  • 00:07:28
    the premark is really the promotional
  • 00:07:30
    activity of a fund manager when he has
  • 00:07:33
    which that fund manager is undertaking
  • 00:07:35
    with respect to a fund uh that falls
  • 00:07:38
    short of marketing under the afmd so a
  • 00:07:41
    step which happens before the fund is is
  • 00:07:44
    effectively
  • 00:07:45
    marketing uh at the time there was no
  • 00:07:47
    uniform position across the EU so we had
  • 00:07:49
    some member states uh such as the UK at
  • 00:07:53
    the time taking a very flexible and open
  • 00:07:56
    approach uh I remember where clients
  • 00:07:59
    were being told that the the
  • 00:08:00
    distribution of a red hering prospectus
  • 00:08:04
    constituted pre-marketing
  • 00:08:06
    um and hence uh wouldn't have attracted
  • 00:08:09
    any any form of of Regulation at that
  • 00:08:12
    moment in time whereas other member
  • 00:08:14
    states were taking a much more
  • 00:08:15
    restrictive approach that effectively
  • 00:08:17
    prohibited pre-marketing so it was
  • 00:08:19
    either marketing or not and of course
  • 00:08:22
    the big difference is that once you
  • 00:08:24
    Market you are subject to all the rules
  • 00:08:27
    um arising from the fmd
  • 00:08:30
    the issue was addressed by setting out a
  • 00:08:32
    definition of pre-marketing
  • 00:08:33
    and by regulating on a pan European
  • 00:08:36
    basis what the fund managers can and
  • 00:08:38
    cannot do as part of these pre-marketing
  • 00:08:41
    activities this was defined as being
  • 00:08:44
    limited to the provision of information
  • 00:08:46
    on investment strategies or investment
  • 00:08:49
    ideas uh there could be other fund
  • 00:08:52
    related information such as the proposed
  • 00:08:54
    terms or structure of the fund which um
  • 00:08:57
    again this is this remains subject to a
  • 00:08:59
    little bit of interpretation as to what
  • 00:09:01
    detail can investors be given in in the
  • 00:09:05
    pre-marketing
  • 00:09:06
    stage the effect of these rules was the
  • 00:09:09
    inability to rely on reverse Sol
  • 00:09:11
    solicitation for a period of 18 months
  • 00:09:13
    following the start of the this
  • 00:09:15
    pre-marketing
  • 00:09:16
    campaign um the afms had to notify their
  • 00:09:19
    home regulator of their pre-marketing
  • 00:09:21
    activities within two weeks the fund
  • 00:09:24
    managers had to ensure that these
  • 00:09:26
    activities were adequately adequately
  • 00:09:28
    documented
  • 00:09:30
    and the rules obliged EU member states
  • 00:09:32
    to permit fund managers that are full
  • 00:09:34
    scope EU afms for AFM the purposes to
  • 00:09:37
    undertake premarketing so there was no
  • 00:09:39
    further discussion and debate once these
  • 00:09:41
    rules were were issued um as to whether
  • 00:09:45
    premarketing was allowed or
  • 00:09:47
    not the next
  • 00:09:51
    initiative um related to the um SF
  • 00:09:56
    related to sfdr so the sustainability
  • 00:09:59
    sustainability factors which were
  • 00:10:01
    introduced um as a response to the
  • 00:10:05
    approach taken by a number of fund
  • 00:10:06
    managers which were tackling um ESG
  • 00:10:09
    risks uh at the level of their investe
  • 00:10:12
    companies and drafting ESG action plans
  • 00:10:14
    and purportedly promoting investment
  • 00:10:18
    strategies which were in line with ESG
  • 00:10:19
    principles without any real regulation
  • 00:10:22
    uh and in fact there were questions were
  • 00:10:24
    being raised as to the veracity of the
  • 00:10:27
    relevant characteristics promoted by
  • 00:10:29
    such funds are these funds ESG compliant
  • 00:10:32
    or not I mean how can they be HG
  • 00:10:33
    compliant if there is no real ESG set of
  • 00:10:36
    rules or set of Standards which they can
  • 00:10:38
    comply to which they can comply with uh
  • 00:10:42
    and at the end of it would be would this
  • 00:10:44
    be would this amount to uh a manner in
  • 00:10:47
    which one could raise capital and
  • 00:10:49
    attract investors without really being
  • 00:10:52
    um uh being compliant with any
  • 00:10:55
    particular set of rules and this was
  • 00:10:58
    this was the backdrop to the
  • 00:10:59
    introduction of e regulation
  • 00:11:02
    2019 uh 2088 on sustainability relating
  • 00:11:06
    related disclosures in the financial
  • 00:11:08
    services sector also known as sfrd this
  • 00:11:13
    regulation basically harmonize the rules
  • 00:11:15
    for the disclosure of of ESG information
  • 00:11:19
    by fund
  • 00:11:20
    managers once this regulation was issued
  • 00:11:23
    AFM aifms were required to account for
  • 00:11:27
    sustainability risks and factors as part
  • 00:11:29
    of their ordinary uh of their ordinary
  • 00:11:32
    course of Duties and Reporting
  • 00:11:34
    obligations are always towards investors
  • 00:11:36
    both at the management company level and
  • 00:11:39
    at the level of the product so these
  • 00:11:40
    sustainability risks and factors have to
  • 00:11:43
    be considered both at the management
  • 00:11:45
    company level and that product level as
  • 00:11:48
    as a result of sfdr afms are required to
  • 00:11:52
    consider if they want to basically
  • 00:11:54
    promote their fund as ESG compliant as
  • 00:11:57
    as uh catering tackling theg
  • 00:12:00
    risks and as well as integrating their
  • 00:12:02
    investment decisions and management
  • 00:12:04
    processes relevant sustainability risks
  • 00:12:08
    and the relevant principle adverse
  • 00:12:10
    impacts of their Investments on
  • 00:12:12
    sustainability factors so there are two
  • 00:12:14
    elements here which need to be uh which
  • 00:12:16
    need to be considered the relevant
  • 00:12:18
    sustainability sustainability risk and
  • 00:12:20
    the relevant principle adverse impact of
  • 00:12:23
    their investment so on on sustainability
  • 00:12:25
    factors so just as an example and I
  • 00:12:28
    found this in in my research in one of
  • 00:12:31
    the the various Publications which came
  • 00:12:33
    out I think it's one one of the best
  • 00:12:34
    examples I've encountered say
  • 00:12:38
    um the distinction between between these
  • 00:12:40
    two concepts because once you read them
  • 00:12:43
    uh one doesn't really appreciate perhaps
  • 00:12:45
    the difference between the relevant
  • 00:12:46
    sustainability risks and the relevant
  • 00:12:49
    principle adverse impacts of their
  • 00:12:51
    Investments or sustainability factors
  • 00:12:53
    these two elements so coming to the
  • 00:12:55
    first element let's say um a fund
  • 00:12:57
    manager takes um is
  • 00:13:01
    considering to make an investment um
  • 00:13:05
    through the fund of course in in a coal
  • 00:13:07
    plant which is producing electricity so
  • 00:13:09
    the first uh aspect would be what are
  • 00:13:13
    the relevant sustainability risks and
  • 00:13:15
    the relevant sustainability risks which
  • 00:13:17
    that fund manager would need to consider
  • 00:13:19
    would be Water Management uh by the SK
  • 00:13:23
    plant uh the use of child labor
  • 00:13:25
    appropriately health and safety policies
  • 00:13:27
    governance and the plants Etc so
  • 00:13:30
    generally speaking how is this how is
  • 00:13:32
    this cop plant being managed and what um
  • 00:13:36
    what risks are arising from the way in
  • 00:13:38
    which this um this C plant is being
  • 00:13:41
    managed uh across the board at a 360
  • 00:13:44
    degree level on the other hand it would
  • 00:13:46
    also need to be conscious of the
  • 00:13:48
    sustainability factors in the sense
  • 00:13:51
    would an investment in such a business
  • 00:13:53
    also cause principal adverse impact on
  • 00:13:56
    ESG factors in this case mainly the
  • 00:13:59
    environmental one since it is a coal
  • 00:14:01
    plant um and as we know um coal might
  • 00:14:05
    not be the cleanest form of of energy um
  • 00:14:10
    of material that one could use and uh
  • 00:14:13
    balancing out these two factors and then
  • 00:14:16
    disclosing to investors how these two
  • 00:14:18
    factors are being considered in the
  • 00:14:20
    Investments which that fund manager is
  • 00:14:22
    making is one of the Hallmarks of this
  • 00:14:26
    regulation so moving on to
  • 00:14:29
    the um to the reform proposal so the
  • 00:14:33
    reform proposal we really and truly
  • 00:14:35
    started off by a letter sent sent by
  • 00:14:38
    Asma as required in terms of the
  • 00:14:39
    directive itself on the 18th August of
  • 00:14:41
    2020 to the commission outlining the
  • 00:14:44
    areas of the fmd which could be improved
  • 00:14:47
    um it then proceeded on the 22nd of
  • 00:14:50
    October of 2020 with the European
  • 00:14:52
    commission launching a consultation on
  • 00:14:54
    the review of the
  • 00:14:56
    fmd 29 January 2021 one so just a a
  • 00:15:00
    quarter three months later um feedback
  • 00:15:03
    was received from interested parties and
  • 00:15:06
    this was required to be submitted as we
  • 00:15:07
    saying by the 29th of January on the
  • 00:15:10
    25th November of 20 2021 then and this
  • 00:15:13
    is one of the of the principal dates um
  • 00:15:17
    the commission published this proposal
  • 00:15:19
    to amend the
  • 00:15:20
    fmd and well finally not really finally
  • 00:15:24
    because the the the the ITA is is is is
  • 00:15:27
    is well we're around um uh halfway there
  • 00:15:31
    is that on the 24th of March of 2022 the
  • 00:15:34
    deadline uh expired for submission of
  • 00:15:37
    feedback to the proposal now at this
  • 00:15:38
    moment in time um the the the status is
  • 00:15:44
    that
  • 00:15:47
    the the the trialogue process needs to
  • 00:15:50
    needs to come in soon there is the
  • 00:15:51
    European Parliament which at the moment
  • 00:15:53
    um I believe the report a report was
  • 00:15:56
    issued yesterday I think it's at the end
  • 00:15:58
    of its first reading I stand to be
  • 00:16:00
    corrected here and then it will move of
  • 00:16:02
    course to also consideration by uh by
  • 00:16:06
    Council um so again going back to uh the
  • 00:16:11
    the the main aim of the directive when
  • 00:16:14
    it was issued in 20 in
  • 00:16:16
    2011 it was issued in the wake of of a
  • 00:16:19
    global financial crisis to achieve
  • 00:16:21
    coherent supervision and management of
  • 00:16:23
    risks of
  • 00:16:24
    aifs um article 69 of the directive
  • 00:16:28
    called for a review of its application
  • 00:16:30
    and in this context as we're saying the
  • 00:16:32
    European commission presented its report
  • 00:16:36
    uh and the detailed assessment of the
  • 00:16:38
    European Parliament and the Council of
  • 00:16:40
    the EU the backto back evaluation
  • 00:16:45
    contained in the in the uh commission
  • 00:16:47
    impact assessment on the directive found
  • 00:16:50
    that the directive was largely um
  • 00:16:53
    achieving its
  • 00:16:54
    objectives um which were saying investor
  • 00:16:57
    protection disclosure to invest the the
  • 00:16:59
    main objectives of the directives were
  • 00:17:00
    largely being being achieved however it
  • 00:17:03
    could benefit from some improvements in
  • 00:17:06
    areas that of course 10 years ago might
  • 00:17:08
    not have been sufficiently addressed or
  • 00:17:10
    that which would have evolved
  • 00:17:12
    considerably since then uh it was on
  • 00:17:15
    this basis that the commission and
  • 00:17:17
    against this backdrop also adopted a new
  • 00:17:19
    capital markets Union action plan in in
  • 00:17:22
    September of 2020 so the completion of
  • 00:17:26
    the of the
  • 00:17:27
    CMU um is is one of the priorities as as
  • 00:17:31
    as you know of the of the European Union
  • 00:17:32
    at this moment in time in order to
  • 00:17:35
    support economic recovery um
  • 00:17:37
    uh across across all France and to to
  • 00:17:41
    tackle the challenges which which the
  • 00:17:43
    European Union is facing um in in in in
  • 00:17:47
    this moment so it was against all this
  • 00:17:51
    backdrop and the improvements which were
  • 00:17:53
    being suggested that the reform proposal
  • 00:17:56
    uh was issued and the reform proposal
  • 00:17:58
    even if you look at the title it relates
  • 00:18:01
    to delegation Arrangements liquidity
  • 00:18:03
    risk management supervisory reporting
  • 00:18:05
    provision of depository and custody
  • 00:18:07
    services and loan origination by
  • 00:18:10
    aifs um this is what is referred to as a
  • 00:18:13
    refit initiative so regulatory Fitness
  • 00:18:15
    and perform as part of the fitness and
  • 00:18:17
    Regulatory Fitness and performance
  • 00:18:19
    program initiative of the
  • 00:18:24
    commission um going back to the to the
  • 00:18:27
    as mon going to go through these because
  • 00:18:29
    it will take us it will take us hours
  • 00:18:31
    the the you're free to read the esma
  • 00:18:34
    letter the esma letter highlighted in
  • 00:18:36
    all um well I could identify 19 19
  • 00:18:40
    points uh which the Asma letter um had
  • 00:18:43
    suggested should be looked into by the
  • 00:18:46
    commission um in order for refinement or
  • 00:18:49
    detail not all these were taken up uh by
  • 00:18:52
    the commission and we're going to go
  • 00:18:53
    into those now uh which have which were
  • 00:18:57
    really really then taken up by the
  • 00:18:59
    commission and on the basis of which uh
  • 00:19:01
    the commission uh proceeded to issue it
  • 00:19:04
    its proposal the
  • 00:19:09
    um
  • 00:19:12
    the this proposal was preceded by a
  • 00:19:15
    consultation um uh as we're saying and
  • 00:19:18
    the consultation had had a really six
  • 00:19:21
    pillars which were an analysis asking
  • 00:19:24
    feedback on an analysis of the directive
  • 00:19:26
    on the utility of the passport
  • 00:19:29
    um the scope of the license whether it
  • 00:19:31
    should be extended to smaller fund
  • 00:19:33
    managers the adequacy and effective of
  • 00:19:36
    obligations of aifms acquiring control
  • 00:19:38
    of non-listed entities Financial
  • 00:19:41
    stability generally as to how this
  • 00:19:42
    directive was helping in in achieving
  • 00:19:44
    that that
  • 00:19:46
    objective um the integration of
  • 00:19:48
    sustainability risks which we were
  • 00:19:50
    referring to previously and the more
  • 00:19:53
    coherent approach in the treatment of
  • 00:19:54
    uset because really and truly even when
  • 00:19:57
    one looks at the proposal
  • 00:19:58
    The Proposal is um is also making some
  • 00:20:02
    changes to the to the is also proposing
  • 00:20:04
    the the the some amendments to the uses
  • 00:20:07
    directive in order for um as much as
  • 00:20:10
    possible the direct the two directives
  • 00:20:12
    to be aligned there was there were
  • 00:20:14
    proposals in the past on a single
  • 00:20:16
    license for aifms and uses managers
  • 00:20:21
    however it it it looks like the approach
  • 00:20:24
    taken so far is that the two directives
  • 00:20:26
    will remain separate but as as much as
  • 00:20:28
    possible with obvious exceptions like
  • 00:20:31
    loan origination can't be provided for
  • 00:20:33
    in the uses directive because it jws
  • 00:20:35
    with the whole concept of aits um W with
  • 00:20:40
    with these exceptions as much as
  • 00:20:41
    possible there will be there will be
  • 00:20:43
    some form of cohesion between the two
  • 00:20:47
    directives so picking on the really the
  • 00:20:50
    five points and I can I can add one more
  • 00:20:53
    maybe um the these Five Points which
  • 00:20:58
    form part of the reform proposal are uh
  • 00:21:01
    loan
  • 00:21:02
    origination um Clarity on the
  • 00:21:04
    requirements of the of Delegation and
  • 00:21:08
    with that I would also link substance
  • 00:21:10
    improving the supply of depository
  • 00:21:12
    services in smaller markets
  • 00:21:15
    harmonization of liquidity management
  • 00:21:17
    tools across the union and improving
  • 00:21:19
    level of data gathered through
  • 00:21:20
    regulatory reporting
  • 00:21:23
    um the I think if if if we were to look
  • 00:21:26
    at these these five points uh starting
  • 00:21:29
    off with the with the first three uh all
  • 00:21:32
    these three as I was saying previously
  • 00:21:34
    are going to be tackled uh by other
  • 00:21:36
    speakers and by other panels during this
  • 00:21:38
    conference so I will just really touch
  • 00:21:40
    upon um just a few details on on on each
  • 00:21:44
    just to just to say that I've said I've
  • 00:21:46
    kind of set the SC um so loan
  • 00:21:50
    origination is now being proposed as an
  • 00:21:52
    activity um to be
  • 00:21:55
    added to
  • 00:21:57
    nx1 to the list of AFM activities which
  • 00:22:00
    is the activity of originating lanss and
  • 00:22:02
    also there's also another activity the
  • 00:22:04
    servicing of securitizations special
  • 00:22:06
    purpose entities there is no detailed
  • 00:22:09
    definition at the in in The Proposal as
  • 00:22:12
    to what activities may be included
  • 00:22:14
    within originating loans and whether
  • 00:22:16
    this would also uh extend only to the
  • 00:22:19
    initial legal lender of record however
  • 00:22:21
    this is detail which one would expect to
  • 00:22:23
    see um going forward arising or being
  • 00:22:26
    clarified there is result of this
  • 00:22:28
    amendment is that a fund manager in one
  • 00:22:31
    member State can utilize the manage
  • 00:22:33
    management passport to manage a fund an
  • 00:22:36
    aif in another member state that engages
  • 00:22:39
    in loan
  • 00:22:40
    origination however there is no passport
  • 00:22:44
    for the for the loan origination or loan
  • 00:22:46
    originating fund itself so you could
  • 00:22:48
    have different member states regulating
  • 00:22:50
    loan origination in different in
  • 00:22:52
    different
  • 00:22:53
    ways uh there are also thresholds
  • 00:22:55
    established which mafred will surely go
  • 00:22:57
    into
  • 00:22:58
    uh on the risk management of the manner
  • 00:23:00
    in which and the thresholds which need
  • 00:23:02
    to be applied when when a when a a fund
  • 00:23:04
    is originating
  • 00:23:07
    loans uh moving on to the next one which
  • 00:23:09
    is
  • 00:23:10
    delegation so here as you probably know
  • 00:23:14
    um the there is quite a a chunk of aifms
  • 00:23:19
    in the European Union which delegate
  • 00:23:22
    either the portfolio or the risk
  • 00:23:23
    management of of the funds that they
  • 00:23:25
    manage the uh you can't delegate both
  • 00:23:29
    the the the because that means that the
  • 00:23:31
    that the AFM is a letter box entity
  • 00:23:33
    however one of these either the risk or
  • 00:23:36
    the portfolio management at least in in
  • 00:23:37
    in my experience as a practitioner I
  • 00:23:40
    have seen being invariably uh invariably
  • 00:23:43
    delegated to third parties these third
  • 00:23:45
    parties could even be members of the
  • 00:23:47
    same group of companies as the AFM so
  • 00:23:49
    doesn't need to be um actually they are
  • 00:23:53
    Mo most of the time third parties being
  • 00:23:56
    Affiliates or members of the same group
  • 00:23:58
    group of companies
  • 00:24:00
    what the proposal is achieving is trying
  • 00:24:03
    to achieve here is that
  • 00:24:06
    um the notific a notification process is
  • 00:24:10
    being introduced where the ifm delegates
  • 00:24:12
    more portfolio or risk management than
  • 00:24:15
    it retains there is no uh really a
  • 00:24:20
    definition of what is more um and as you
  • 00:24:23
    will appreciate portfolio or risk
  • 00:24:25
    management you can't really pin it down
  • 00:24:27
    to a percentage so if I delegate 51% of
  • 00:24:30
    my portfolio or risk management am I
  • 00:24:32
    delegating more which means then that I
  • 00:24:34
    would have to
  • 00:24:35
    notify um my national competent
  • 00:24:38
    Authority which would then in turn uh be
  • 00:24:41
    required to notify the European
  • 00:24:44
    Securities and markets Authority on an
  • 00:24:46
    annual basis um so this is probably
  • 00:24:50
    something which which might have to be
  • 00:24:51
    clarified going forward linked to
  • 00:24:54
    delegation there are also substance
  • 00:24:56
    requirements which are being proposed
  • 00:24:57
    osed um which really I I must say stayed
  • 00:25:01
    the obvious because really and truly
  • 00:25:03
    what the substance requirements are
  • 00:25:05
    setting out is that the business of the
  • 00:25:08
    of the aifm needs to be managed by two
  • 00:25:11
    full-time
  • 00:25:12
    employees um or if they're not employed
  • 00:25:15
    fulltime they are committed full-time to
  • 00:25:17
    conducting the business of the fund
  • 00:25:18
    manager and they are resident in the EU
  • 00:25:22
    so the way I read it at least the The
  • 00:25:25
    Proposal is not requiring these people
  • 00:25:27
    to actually
  • 00:25:28
    in the same country of domicile as the
  • 00:25:30
    fund manager but they would have to be
  • 00:25:32
    resident in the EU wherever that is
  • 00:25:36
    um again further detail we probably uh
  • 00:25:40
    you will probably have have further
  • 00:25:42
    detail on the on both both substance and
  • 00:25:44
    delegation in in uh in M session right
  • 00:25:48
    after
  • 00:25:49
    mine uh moving to the third uh point in
  • 00:25:53
    the in the proposal which are the
  • 00:25:55
    deposit res services so um uh the rule
  • 00:25:59
    at the moment in the in the
  • 00:26:01
    directive is that the depository of an
  • 00:26:04
    EU a has to be established in the home
  • 00:26:06
    member state of the fund so if there is
  • 00:26:09
    a fund if I am doic iling a fund in
  • 00:26:12
    Luxembourg then the depository needs to
  • 00:26:14
    be in
  • 00:26:16
    Luxembourg uh that is uh this is a rule
  • 00:26:19
    which um was subject to an exception uh
  • 00:26:23
    which lapsed in in July of
  • 00:26:26
    2017 um uh because the until July of
  • 00:26:31
    2017 the depository of the fund could
  • 00:26:34
    also be in a different member State and
  • 00:26:37
    not necessarily in the same member State
  • 00:26:39
    as the as the fund and in fact this is
  • 00:26:43
    in a way um
  • 00:26:46
    uh one of the one of the the the reforms
  • 00:26:50
    which are which are being interested in
  • 00:26:51
    a way
  • 00:26:53
    Reviving um the the previous derogation
  • 00:26:56
    which there was article 21 of the
  • 00:26:59
    fmd uh allowing the provision of
  • 00:27:01
    crossborder deposit Services uh this was
  • 00:27:04
    a result
  • 00:27:06
    of um the uh the commission study where
  • 00:27:12
    it was noted that there were there were
  • 00:27:15
    some concentrated markets lacking a
  • 00:27:18
    competitive supply of depository
  • 00:27:20
    Services especially in the in in smaller
  • 00:27:22
    countries uh or in countries where the
  • 00:27:25
    depository offering is is uh is very
  • 00:27:28
    limited to a few
  • 00:27:30
    players the commission has not
  • 00:27:34
    considered introducing or proposing the
  • 00:27:37
    introduction of a
  • 00:27:39
    passport which would also would then
  • 00:27:41
    certainly allow for the crossbo uh
  • 00:27:44
    provision of the of depository Services
  • 00:27:48
    because um at the moment this this
  • 00:27:51
    option wouldn't be feasible given the
  • 00:27:53
    absence of EU harmonization of
  • 00:27:55
    Securities and insolvency laws uh on the
  • 00:27:58
    other hand in its in one of its report
  • 00:28:01
    the the Parliamentary reporter has
  • 00:28:03
    encouraged the the the commission to to
  • 00:28:07
    carry out a study about the feasibility
  • 00:28:09
    of introducing a passport in Du
  • 00:28:11
    course um to note that this derogation
  • 00:28:16
    or this proposal to allow for cross the
  • 00:28:18
    crossborder provisioning of depository
  • 00:28:21
    Services is limited to the fmd and not
  • 00:28:25
    to the uses directive
  • 00:28:29
    so moving to the to the last two really
  • 00:28:34
    um uh proposals one relating to
  • 00:28:38
    liquidity management tools and the last
  • 00:28:40
    one relating to reporting requirements
  • 00:28:43
    so starting off with liquidity
  • 00:28:45
    management
  • 00:28:47
    tools
  • 00:28:48
    um the liquidity management tools there
  • 00:28:52
    is a a whole enex which which outlines
  • 00:28:54
    what they are basically um uh which is a
  • 00:28:57
    new nx5 which is being introduced to the
  • 00:29:01
    directive and the requirement is that if
  • 00:29:04
    where where a manager is managing
  • 00:29:06
    open-ended aifs um uh they must choose
  • 00:29:10
    these these liquidity managements tools
  • 00:29:12
    they are required to choose um the a
  • 00:29:15
    liquidity management tool and and also
  • 00:29:18
    reflect it in there so there's a
  • 00:29:20
    disclosure requirement in the in the
  • 00:29:23
    documentation uh which is which is uh
  • 00:29:25
    distributed to investors
  • 00:29:28
    uh as and there is also a um a proposal
  • 00:29:32
    for esma to have the power to require a
  • 00:29:35
    fund manager this is the The Proposal of
  • 00:29:37
    the of the commission uh to activate or
  • 00:29:39
    deactivate a liquidity management tool
  • 00:29:41
    in particular circumstances there are
  • 00:29:43
    eight of these tools uh which are listed
  • 00:29:46
    in in the proposed suggested anex five
  • 00:29:49
    of the directive and if one looks
  • 00:29:52
    through them all I think the the in in
  • 00:29:56
    in in the that I've been practicing I've
  • 00:29:58
    seen them all other than number five in
  • 00:30:02
    my case at least which is Swing pricing
  • 00:30:04
    because all the others U be it
  • 00:30:06
    suspension of redemptions and
  • 00:30:08
    subscriptions the introduction of
  • 00:30:10
    redemption Gates um uh the introduction
  • 00:30:13
    of notice periods where one has to give
  • 00:30:15
    advanced
  • 00:30:17
    notice to the fund manager that they are
  • 00:30:19
    that an investor is redeeming his shares
  • 00:30:22
    uh the imposition of redemption fees in
  • 00:30:25
    case of
  • 00:30:26
    redemptions uh an anti-dilution Levy
  • 00:30:28
    where you have a levy to pay where there
  • 00:30:31
    is a levy which is charged where um an
  • 00:30:35
    investor is is redeeming his investment
  • 00:30:37
    and the the the the uh by this
  • 00:30:40
    Redemption then prejudicing potentially
  • 00:30:42
    remaining investors
  • 00:30:45
    um which is which then introduces costs
  • 00:30:49
    which are associated with the purchases
  • 00:30:51
    or sales of assets because of large
  • 00:30:52
    inflows or outflows so a single main
  • 00:30:55
    investor might be required to pay a ly
  • 00:30:59
    if they decide to redeem because then
  • 00:31:01
    the the total expense ratio would
  • 00:31:03
    obviously increase because less less
  • 00:31:06
    investors remain and the fund might even
  • 00:31:09
    suffer uh a squeeze on its on it on the
  • 00:31:11
    liquidation of its Assets in order to
  • 00:31:13
    satisfy that Redemption request
  • 00:31:15
    redemptions in kind so this number seven
  • 00:31:17
    redemptions in kind I think um are used
  • 00:31:21
    used frequently in the in the fund
  • 00:31:24
    industry uh particularly where the
  • 00:31:27
    underlying Investments are IL liquid so
  • 00:31:30
    rather than
  • 00:31:31
    liquidating um a piece of a piece of
  • 00:31:33
    immovable property in which the in which
  • 00:31:35
    the fund might have invested at an
  • 00:31:37
    undervalue in a fire sale there is an
  • 00:31:40
    agreement which is reached between
  • 00:31:41
    investors and the fund uh in order for
  • 00:31:45
    these investors to actually be given
  • 00:31:47
    either the whole or a portion of that
  • 00:31:49
    immovable property depending of of
  • 00:31:51
    course on the on the investment strategy
  • 00:31:53
    and the manner in which the funds
  • 00:31:54
    Investments are are structured and
  • 00:31:56
    finally Side Pockets again Side
  • 00:31:59
    Pockets I believe the first time I saw
  • 00:32:01
    them was in 2008 at the beginning of the
  • 00:32:04
    financial crisis um where at the time I
  • 00:32:07
    remember the mfsa had introduced as well
  • 00:32:09
    rules in relation to side pockets and
  • 00:32:12
    how disclosures should be made on side
  • 00:32:14
    pockets um side pockets would would
  • 00:32:16
    allow liquid Investments to be parked
  • 00:32:19
    not to be considered in the in the
  • 00:32:21
    calculation of the of the net asset
  • 00:32:23
    value so they are separated in a in a
  • 00:32:25
    pocket on on on the side from remaining
  • 00:32:27
    liquid investments in order not to
  • 00:32:29
    contaminate the whole uh the whole
  • 00:32:32
    portfolio of the fund so the fund
  • 00:32:33
    manager would be allowed to set aside um
  • 00:32:37
    in in a side pocket diesel liquid
  • 00:32:39
    Investments and these are I mean these
  • 00:32:42
    tools have been utilized by the fund
  • 00:32:44
    industry for for several years now so no
  • 00:32:47
    no no surprises here um it seems however
  • 00:32:52
    that in in in some member states perhaps
  • 00:32:55
    there were a number of instances where
  • 00:32:57
    uh
  • 00:32:58
    these these these tools were not being
  • 00:33:01
    utilized as they should have um I don't
  • 00:33:04
    know about
  • 00:33:05
    that
  • 00:33:07
    finally and this brings me really to to
  • 00:33:09
    a conclusion on the reform proposal the
  • 00:33:12
    reporting requirements there are two
  • 00:33:13
    types of reporting there's the nx4
  • 00:33:15
    reporting where it is being suggested
  • 00:33:17
    that um the reports which are today
  • 00:33:21
    being submitted to the
  • 00:33:23
    ncas about Investments made in PR
  • 00:33:27
    principal markets of main instruments
  • 00:33:29
    which are being managed and principal
  • 00:33:31
    exposures all these
  • 00:33:34
    um uh these these qualifications are
  • 00:33:37
    removed and basically there is a full
  • 00:33:39
    report in relation to all Market
  • 00:33:41
    instruments and exposures uh rather than
  • 00:33:44
    a qualification before each uh before
  • 00:33:47
    each one like main most important
  • 00:33:49
    concentration so the materiality uh
  • 00:33:52
    tests in these um in in in the current
  • 00:33:55
    reporting The Proposal is is is is
  • 00:33:57
    suggesting that it is removed uh
  • 00:34:00
    secondly then another form of reporting
  • 00:34:03
    where there are proposal being made is
  • 00:34:04
    on investor disclosure uh the investor
  • 00:34:07
    disclosure requirements we've already
  • 00:34:08
    touched upon um because these are linked
  • 00:34:11
    really to other proposals where the the
  • 00:34:13
    fund is originating loan originating
  • 00:34:16
    loans so in that case there would need
  • 00:34:17
    to be
  • 00:34:18
    reporting um there would need to be
  • 00:34:21
    sorry disclosure in the in the fund
  • 00:34:23
    documentation um uh the uh the the
  • 00:34:27
    information needs to be disclosed on the
  • 00:34:28
    possibility of using liquidity
  • 00:34:30
    management tools list of fees and
  • 00:34:32
    charges would need to be disclosed in
  • 00:34:34
    connection with the operation of the
  • 00:34:36
    fund and of the manager as well
  • 00:34:40
    um so basically it's it's uh further
  • 00:34:45
    disclosure of investor to to investors
  • 00:34:48
    uh which is being proposed which to my
  • 00:34:50
    mind um sounds sounds
  • 00:34:53
    obvious one last
  • 00:34:55
    point
  • 00:34:57
    which uh which I wanted to make in
  • 00:34:59
    relation to to to the reform proposals
  • 00:35:02
    relates to article 42 uh which is not in
  • 00:35:05
    the
  • 00:35:06
    slides um so article 42 is is the
  • 00:35:11
    establishes the national private
  • 00:35:13
    placement regime so now the proposal is
  • 00:35:15
    is suggesting the introduction of a
  • 00:35:17
    different standard so rather
  • 00:35:20
    than requiring the non-e fund manager or
  • 00:35:24
    the non-eu fund to be established in a
  • 00:35:27
    country which is not listed in the fatf
  • 00:35:30
    uh fatf list of highest jurisdictions
  • 00:35:32
    that is being replaced by requiring that
  • 00:35:36
    the nonu fund manager and the non-u fund
  • 00:35:39
    is not a highrisk jurisdiction pursuant
  • 00:35:42
    to the eu's AML directive and in
  • 00:35:45
    addition to
  • 00:35:46
    that it is also proposing um that there
  • 00:35:51
    is a the the the the this this the
  • 00:35:53
    jurisdiction the domicile of the fund
  • 00:35:55
    manager or the fund is not on the EU
  • 00:35:58
    list of non-cooperative tax
  • 00:36:00
    jurisdictions the rest in relation to
  • 00:36:02
    the signat being signatories to the OCD
  • 00:36:04
    model tax convention Remains the Same um
  • 00:36:08
    and this is really a reflection um which
  • 00:36:11
    has already of of another of of the same
  • 00:36:14
    practically the same change
  • 00:36:17
    um which has already been introduced in
  • 00:36:19
    in in in another directive so similar
  • 00:36:22
    changes um uh were also introduced in
  • 00:36:26
    the
  • 00:36:27
    um uh in in other directives in the
  • 00:36:29
    European Union issued by the European
  • 00:36:31
    Union so that I think brings me to an
  • 00:36:35
    end on the reform proposals the
  • 00:36:37
    conclusion really is that um the
  • 00:36:40
    consultation has shown that the
  • 00:36:43
    directive has had a mostly a positive
  • 00:36:44
    impact it has created an internal market
  • 00:36:46
    for funds as we were saying before it
  • 00:36:50
    has allowed for more effective
  • 00:36:51
    supervisory
  • 00:36:53
    oversight um the and and
  • 00:36:57
    it it it has generally improved investor
  • 00:37:00
    protection as well so really and truly
  • 00:37:04
    the it's quite quite a a positive a
  • 00:37:07
    positive initiative which however
  • 00:37:09
    requires a little bit of tweaking and
  • 00:37:12
    some change in order to bring it in line
  • 00:37:15
    with um more recent expectations and
  • 00:37:18
    more recent realities which have evolved
  • 00:37:20
    over the last over the last 10
  • 00:37:24
    years um I can I think I've come to an
  • 00:37:27
    end of my presentation I can take um
  • 00:37:30
    questions if we have time because I'm
  • 00:37:32
    conscious that I've taken even the
  • 00:37:35
    question I've taken up even the question
  • 00:37:40
    [Music]
  • 00:37:49
    time
Tag
  • afmd
  • reformes
  • sostenibilitat
  • protecció inversor
  • comercialització fons
  • gestió riscs
  • transparència
  • regulació UE
  • gestors fons
  • directiva