AIFMD Rules and Guidance, 2021

Summary

This is the GFSC's AIFMD Rules and Guidance, 2021, which replace the AIFMD Rules 2013 and came into force on 1 November 2021. They set out an opt-in regulatory regime that allows Guernsey alternative investment fund managers (AIFMs) and depositaries to comply with EU AIFMD-equivalent standards so that they can market Guernsey AIFs to professional or retail investors in EU Member States.

The Rules apply on an opt-in basis only to Guernsey AIFMs (in respect of AIFs they manage and propose to market in the EU or EU AIFs they manage), Guernsey depositaries of AIFs, and Non-Financial Asset AIF Depositaries who elect to comply. They mirror the substantive content of the EU AIFMD (conditions for acting as an AIFM, capital, risk and liquidity management, conflicts of interest, valuation, depositary duties, reporting, and rules on control of non-listed companies) while being enforced as Commission Rules under Guernsey's Protection of Investors Law.

• Opt-in application and notification: An AIFM or applicant wishing to opt in must notify the Commission in writing, providing details of organisational structure, investment strategies, delegation arrangements, capital, risk management systems and certifications.
• Marketing notification: A Guernsey AIFM must notify the Commission within 14 calendar days of commencing marketing in an EU Member State, including the Member State, competent authorities, and AIF details (unless notified under the AIFMD (Marketing) Rules 2021).
• Notification of changes: Material changes to previously submitted information, and any significant new activities, branches, offices or subsidiaries, must be notified to the Commission in writing and in advance.
• Conduct, remuneration and organisation: AIFMs must act honestly and in investors' best interests, maintain remuneration policies for staff affecting risk profiles, and maintain adequate human, technical, administrative and accounting resources.
• Capital, risk and liquidity: AIFMs must meet initial capital and own funds requirements and operate risk management and liquidity risk management systems appropriate to each AIF.
• Depositary requirements: Guernsey depositaries and non-financial asset AIF depositaries opting in must meet eligibility, capital, delegation, liability and operating condition requirements, and maintain a defined relationship with the Commission.
• Reporting and disclosure: AIFMs must produce annual reports, make prescribed disclosures to investors, and submit periodic reporting to the Commission, including on leverage.
• Control of non-listed companies: Additional notification, disclosure and anti-asset-stripping obligations apply where an AIFM's AIF acquires control of a non-listed company or issuer.

The 2013 version of these Rules is revoked and replaced in full by this 2021 version, which took effect from 1 November 2021.

Key obligations

• A Guernsey AIFM or applicant wishing to opt into the Rules must notify the Commission in writing, in the required form, with prescribed details on structure, strategy, delegation, capital and risk management.
• A Guernsey AIFM must notify the Commission within fourteen calendar days of commencing marketing in an EU Member State, including required identifying and certification information (unless already notified under the AIFMD (Marketing) Rules 2021).
• A Guernsey AIFM must notify the Commission in writing and in advance of any material changes to previously submitted information and prior to engaging in significant new activities or establishing new branches, offices or subsidiaries.
• A Guernsey AIFM must maintain remuneration policies and practices for staff whose activities materially affect risk profiles, consistent with sound risk management.
• A Guernsey AIFM must maintain adequate human and technical resources, sound administrative and accounting procedures, and appropriate control and safeguarding arrangements.
• A Guernsey AIFM must hold and maintain the required initial capital and own funds under these Rules.
• A Guernsey AIFM must operate appropriate risk management and liquidity risk management systems for each AIF it manages.
• A Guernsey AIFM must identify, manage, monitor and where applicable disclose conflicts of interest to prevent adverse effects on AIFs and investors.
• A Guernsey AIFM must comply with valuation requirements for AIF assets.
• A Guernsey depositary or non-financial asset AIF depositary opting in must meet eligibility, minimum capital, delegation, liability and operating condition requirements and maintain the prescribed relationship with the Commission.
• A Guernsey AIFM must produce an annual report for each AIF managed and make required disclosures to investors.
• A Guernsey AIFM must submit periodic reports to the Commission, including on leverage employed by AIFs it manages.
• A Guernsey AIFM whose AIF acquires control of a non-listed company or issuer must make notifications and disclosures and comply with asset stripping restrictions on such companies.
• A Guernsey AIFM must comply with both these Rules and the AIFMD (Marketing) Rules, 2021 once it has opted in.

Applies to

Guernsey AIFMs, Guernsey depositaries of AIFs, Non-Financial Asset AIF Depositaries

Deadlines

• 1st November 2021: Commencement date of the AIFMD Rules and Guidance, 2021, revoking the AIFMD Rules 2013.
• 14 calendar days after commencement of marketing: Deadline for a Guernsey AIFM to notify the Commission after beginning marketing an AIF in an EU Member State.
• in advance of the change: A Guernsey AIFM must notify the Commission in writing and in advance of any material changes to previously submitted information or before engaging in significant new activities or establishing new branches, offices or subsidiaries.

Related documents

• This document is made under Protection of Investors (Bailiwick of Guernsey) Law, 2020