ALFI disagrees with ESMA’s approach on a number of points. ALFI therefore suggests that, during an initial period, national competent authorities shall apply the AIFM Directive in relation to "definition of an AIFM" and "definition of an AIF" on the basis of the already detailed provisions of the AIFM Directive in this regard. Competent authorities have substantial experience and knowledge in these areas, and will therefore be able to adopt a coherent approach. This does not prevent competent authorities from consulting each other, or ESMA from issuing clarification at a later time.
The AIFM Directive thus does not limit the possibility to delegate both functions at the same time, the limit to the delegation being for the AIFM to remain liable and not to become a letter box entity. In this regard, it is worth mentioning that the extent of the delegation (i.e. the concept of letter box entity) is already part of the ESMA Final Report (as one of the delegated acts to be adopted by the Commission according to article 20(7) b)), which defines the above concept as the situation where the AIFM is no longer able to supervise the delegated tasks and to manage the risks associated with the delegation effectively, nor is it able to take decisions in key areas which fall under the responsibility of the senior management.
In addition, ALFI would like to stress the fact that the AIFM Directive is clear, precise and unconditional on the fact that it is sufficient, for an AIFM so to act, to provide (take the responsibility of) both portfolio and risk management without having to perform the additional activities (administration, marketing) and without providing in such a case that those activities are to be considered as having been delegated to third parties. Therefore again, the proposed interpretation goes beyond the terms of the AIFM Directive.
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© ALFI - Association of the Luxembourg Fund Industry
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