AIFMD in Germany | White & Case LLP International Law Firm, Global Law Practice
AIFMD in Germany

AIFMD in Germany

Strategies for non-EU AIFMs Marketing Alternative Investment Funds

In conjunction with the implementation of the European Directive on Alternative Investment Fund Managers (2011/61/EU) (the "Directive" or "AIFMD") the German legislature decided to abolish the private placement regime in Germany, i.e., to terminate unregulated marketing and distribution of alternative investment funds ("AIFs").

As a result, from 22 July 2013 onwards, any kind of marketing or distribution of units in AIFs in Germany will be subject to governmental approval by BaFin, the German Financial Supervisory Authority.

In addition, although the Directive provides for an EU passport regime that allows AIF managers ("AIFMs") to submit to regulation in one European jurisdiction while being permitted to market their AIFs throughout the EU (the "EU Passport Regime"), between 22 July 2013 and July 2015 (at the earliest), only EU-domiciled AIFMs (EU-AIFMs) marketing EU-domiciled AIFs (EU-AIFs) are eligible for the EU Passport Regime.

Therefore, during this 1st transitional period, non-EU AIFMS wishing to place AIFs (whether or not domiciled in the EU) in Germany, or EU-AIFMs wishing to place non-EU AIFs in Germany will need to comply with domestic requirements set out in Germany’s newly introduced Capital Investment Act (Kapitalanlagegesetzbuch or "KAGB") (the "National Regime").

Non-EU AIFMs that are marketing EU-AIFs may also choose to re-domicile to a European jurisdiction and make use of the EU Passport Regime.

Unlike some other European jurisdictions, Germany chose not to extend is National Regime in parallel with the full implementation of the EU Passport Regime during the 2nd transitional period between July 2015 (at the earliest) and July 2018 (at the earliest). Therefore, as of July 2015 (at the earliest), the EU Passport Regime will be the sole authorisation recognised by the KAGB for all AIFMs and AIFs, regardless of where they are domiciled.

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