The European Securities and Markets Authority (ESMA) has approved the co-operation arrangements between the Guernsey Financial Services Commission (GFSC) and the EU securities regulators for the supervision of alternative investment funds (AIFs), including hedge funds, private equity and real estate funds.
ESMA has negotiated the agreement with the GFSC on behalf of all 27 EU member state securities regulators as well as authorities from Croatia, Iceland, Liechtenstein and Norway.
The co-operation arrangements include the exchange of information, cross-border on-site visits and mutual assistance in the enforcement of respective supervisory laws. This co-operation will apply to Bailiwick of Guernsey alternative investment fund managers (AIFMs) that manage or market alternative investment funds (AIFs) in the EU and to EU AIFMs that manage or market AIFs in the Bailiwick of Guernsey. The arrangements also cover co-operation in the cross border supervision of depositaries and AIFMs’ delegates. The agreement will take the form of a memorandum of understanding (MoU) between the EU securities supervisors and the GFSC.
The key elements of the EU-Guernsey cooperation arrangements are:
• EU and Guernsey supervisors will be able to supervise fund managers that operate on a cross border basis in the Bailiwick and the EU;
• The co-operation between the authorities includes the exchange of information, cross border, onsite visits and assistance in the enforcement of the respect laws;
• EU authorities will be able to share relevant information received from the GFSC with other EU authorities, ESMA and the European Systemic Risk Board, provided appropriate safeguards apply;
• The existence of co-operation arrangements between the EU and non-EU authorities is a precondition of the AIFMD for allowing managers from third countries to access EU markets or perform fund management by delegation from EU managers; and
• The EU-Guernsey co-operation arrangements are applicable from 22 July 2013 and enable cross-border management and marketing to professional investors of alternative investment funds.
Carl Rosumek, director of investment business at the Guernsey Financial Services Commission, says: “I am pleased that, following months of detailed work and engagement with ESMA, that ESMA has approved the co-operation arrangements between the Commission and EU securities regulators. ESMA’s approval of these arrangements is a positive endorsement of the Commission. The arrangements will further improve cross-border supervision of the funds industry and ultimately reinforce investor protection in the cross border operations of alternative funds.”
Nik van Leuven, director general, and William Mason, director general designate, say: “We are very grateful for the exceptional effort made by the Investment Business Division in securing this valuable MoU for Guernsey.”
