Guernsey: Guernsey Plans Dual Regime For AIFMD
Last Updated: 8 November 2012

Guernsey is planning to have two parallel regulatory regimes for investment funds as a way to best meet client needs when the EU's Alternative Investment Fund Managers Directive (AIFMD) comes into force.

Fiona Le Poidevin, Chief Executive of Guernsey Finance – the promotional agency for the Island's finance industry, has today reiterated Guernsey's intention to introduce a regime which is fully AIFMD compliant, while also maintaining the existing regulations for those investors and managers not requiring an AIFMD fund.

It had been expected that the final Level 2 rules for the detailed implementation of AIFMD would be published in early autumn but now it is believed that this might not happen until December. The delay is fuelling speculation that the July 2013 deadline for the rules being transposed into local legislation may be put back but this remains unclear.

Miss Le Poidevin said: "As a leading international funds centre, Guernsey has been closely following the development of AIFMD, has been active in the debate in Brussels and is well advanced in its preparations to offer an AIFMD compliant regime from as early as July 2013. With the continued delay to the publication of the rules, it is important for existing clients that Guernsey is clear on its intentions now.

"It is our intention that Guernsey will operate a full AIFMD equivalent regime for those EU investors and managers who are obliged to take this route or any investors or managers who choose this as their preferred option. For non-EU investors and managers, investing in the EU and globally, there will remain a parallel regime with its own appropriate set of regulations. This will also be available to EU investors who are able to take advantage of the national private placement regime in the immediate term or those who fall outside the scope of AIFMD.

"What we are planning to do is provide clients with the flexibility to choose a regime which best suits their needs from a jurisdiction that has always regulated managers and funds across all sectors to leading international standards. We believe that this proposition will prove very attractive and as such, will ensure that Guernsey remains a leading global fund domicile in the future."

Neale Jehan, Executive Director at KPMG in Guernsey and Chairman of the Technical Committee of the Guernsey Investment Fund Association (GIFA), is leading the local fund industry's response to AIFMD.

He said: "As a non-EU jurisdiction with close proximity and business ties to the EU, it is essential that we seek to comply with AIFMD for those clients obliged to or who wish to take advantage of the regime in the coming years. However, we must recognise that we have clients whose business does not touch the EU at all in terms of management or marketing of funds and it is important that these clients have the choice to elect to fall under the AIFMD regime or remain outside, as is their right. In being able to offer both EU and non-EU solutions from one location, Guernsey will be ideally placed to serve the global fund industry."

Latest figures from the Guernsey Financial Services Commission (GFSC) show that the net asset value of investment funds under management and administration in Guernsey reached £270.8 billion at the end of June 2012 – up £711 million (0.3%) in the second quarter of the year. This represents a decrease of £3.6 billion (1.3%) year on year but is up £46.6 billion (20.8%) on the same time two years ago and an increase of £101.2 billion (59.6%) since the end of June 2009.

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