Notified Alternative Investment Funds
The MFSA has announced on the 11 February 2016 the launch of a new fund regime for Alternative Investment Funds – the Notified AIF. The Notified AIF does not require licensing by the MFSA and is not subject to ongoing supervision. A list of Notified AIFs in good standing is available on the MFSA’s website.
A Notified AIF takes most of the features of the licensed AIF but without having to undergo the process of licensing by the MFSA. However, despite that the Notified AIF will not be licensed by the MFSA, the Manager will take the burden of ensuring that the Notified AIF is in compliance with all the respective rules and regulations.
Structure
A Notified AIF may be structured in the form of any of the forms previously discussed under the AIF regime above.
Main Features
The eligibility for a Fund for the process of notification, applies to AIFs which are promoted to Qualifying or Professional Investors. Funds falling within the scope of the Notified AIF shall be managed by an AIFM which is authorised and regulated under the AIFMD. Therefore, a Notified AIF cannot be self-managed. Furthermore, the Notified AIF cannot be in the form of a Loan Fund and cannot invest in non-financial assets.
The AIFM
Under the Notified AIF’s regime, due diligence requirements and ongoing supervision are the AIFM’s responsibility. Thus, prior to submitting a request for notification, the AIFM shall carry out the necessary due diligence process to ensure that the service providers and governing body of the AIF are “fit and proper” as specified by the MFSA. Moreover, the AIFM shall undertake and ensure that each service provider and governing body of the AIF maintain the “fit and proper” standard on an ongoing basis.
The AIFM should notify the MFSA in the case of any changes in service providers and/or members of the governing body of the AIF and shall keep records of all evidence of, and correspondence regarding, the due diligence process carried out. The AIFM shall further appoint an MLRO for the supervision of the Notified AIF.
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