AIFMD

How does it affect private equity?

The AIFMD is the piece of EU law with by far the biggest direct impact on the private equity and venture capital industry, particularly fund managers (regardless of whether or not they are located in the EU or meet the minimum threshold) as well as European LPs.

The Directive is directly applicable to private equity fund managers with assets under management greater than €500 million and enables them to manage and market their funds more easily across the EU through a single internal market passport. To benefit from this access, fund managers need to be authorised with their national competent authorities, and comply with stringent operational requirements in the field of depositaries, valuation, capital adequacy, disclosure, investor reporting and remuneration.

While fund managers with less than €500 million under management are exempted from the full requirements of the AIFMD, they are still subject to a simplified registration and reporting regime.

Latest changes

Following a review focusing on delegation, liquidity and loan-origination rules - which was concluded in 2024 and will enter into effect in 2026 - new aspects of the AIFMD will be revised:

• additional rules on value for money and undue costs will soon be introduced as a result of changes in the Retail Investment Strategy

• currently under discussion, the Market Integration proposal will simplify and harmonise some of the AIFMD authorisation and marketing requirements

• a proposal is expected, likely in 2027, that could introduce modifications to the AuM thresholds at which the rules apply