Jersey remains on track to meet the requirements of the EU Alternative Investment Fund Managers Directive (AIFMD) and will introduce new fund regulations in April.
More than 350 practitioners including lawyers, fund managers and other finance professionals were given an update on how Jersey intends to remain a first choice jurisdiction for those structuring fund vehicles at the annual funds conference organised by Jersey Finance in London on 7 March.
The regulations are part of Jersey’s approach to complying with AIFMD, designed to offer alternative fund managers an ongoing route into Europe through private placement arrangements by creating a regime for the signing of co-operation agreements with the European Securities and Market Authority (ESMA) and the regulators of individual EU Member States.
By mirroring the AIFMD criteria, the new regulations also pave the way for the creation of a passport regime for alternative investment funds as soon as it becomes available to “third countries” in 2015.
Meanwhile, Jersey continues to report increasing funds business, especially in the alternatives market. The net asset value of funds at the end of 2012 stood at GBP192bn, more than GBP3bn higher than at the end of the third quarter and, significantly, the value of both private equity and hedge funds grew by more than two per cent, highlighting the strength of the alternative funds sector which accounts for 70 per cent of all Jersey funds business.
It was a further theme of the conference that a number of established alternative fund managers were considering an increased presence or opening new offices in Jersey to best take advantage of the changing regulatory landscape and Jersey’s position in it. As a non EU jurisdiction, Jersey will continue to offer managers flexibility through a completely separate funds regime that lies outside the scope of the AIFMD, for those managers marketing to the rest of the world who do not need access to EU capital.
Geoff Cook (pictured), chief executive, Jersey Finance, who addressed the conference, says: “We are confident that we will satisfy the criteria to comply with the AIFMD and remain attractive both for ongoing ‘business as usual’ activity with Europe and also the increasing volume of business targeting markets outside the Eurozone. At the same time, there is also evidence of an uptake of new entrants from the fund sector having an enhanced presence and in some cases opening new offices in Jersey.”
Jersey has in train the following:
• Creation of an opt-in regime for managers wishing to market to European investors by mirroring EU requirements, through private placement arrangements with individual EU countries
• The introduction of its own set of AIFMD regulations which start to come into effect from next month
• A process to enable individual agreements to be signed between Jersey’s regulator and the regulators of EU member states
These moves will ensure that Jersey has a fully AIFMD-compliant regime ready to go by 2015.