ESMA Adds Further AIFMD Regulatory Co-operation Agreements

The European Securities and Markets Authority has approved seven further framework agreements for co-operation arrangements between European Union securities regulators and global counterparts with responsibility for oversight of alternative investment funds including hedge funds, private equity and real estate funds.

ESMA's Board of Supervisors has approved additional memorandums of understanding with regulators from five countries, including the US Commodity Futures Trading Commission, ahead of the introduction of the Alternative Investment Fund Managers Directive, which took effect on Monday, July 22.

ESMA has now negotiated a total of 38 co-operation agreements on behalf of the 31 EU and European Economic Area national regulators responsible for securities markets supervision, after approving 31 MoUs in May. The agreements provide for the exchange of information, cross-border on-site visits and mutual assistance in the enforcement of each jurisdiction's supervisory laws.

The agreements cover third-country alternative fund managers that market funds in the EU and EU-based managers that manage or market funds outside the EU. The agreements also cover co-operation in the cross-border supervision of depositaries and other providers of outsources services to alternative managers.

EU national securities regulators are in the process of signing MoUs with outside jurisdictions relevant to their market. The existence of co-operation arrangements between EU and non-EU regulators is a precondition for allowing managers from third countries access to EU markets or to perform fund management tasks delegated by EU managers under the AIFM Directive.

Applicable from July, the agreements will allow the cross-border marketing of alternative funds to professional investors in other jurisdictions jurisdictions. In addition, non-EU jurisdiction must not be classified by the Financial Action Task Force as...