On 11th February, 2013, the European Securities and Markets Authority (“ESMA”) published the final guidelines on sound remuneration policies under the AIFMD (the “Guidelines”). Click here for a copy of the Guidelines. The Guidelines build upon Annex II of the Alternative Investment Fund Managers Directive (“AIFMD”) which establishes a set of rules with which AIFMs have to comply when establishing and applying the remuneration policies for certain categories of their staff as well as the Level II Regulations’ provisions regarding remuneration policies, conflicts of interest and disclosure of remuneration.
The Guidelines will apply to managers of alternative investment funds (AIFs) including hedge funds, private equity funds and real estate funds. Non-EU AIFMs who market funds (using the passport) to EU investors will also be subject in full to the Guidelines after the transitional period.
The Guidelines do not have direct effect in EU Member States; however, in implementing the requirements of the AIFMD, EU Member States will be required to do so in accordance with the Guidelines. In Malta, the AIFMD is being implemented by means of a suite of regulations issued under the Investment Services Act (Cap. 370, laws of Malta) and several amendments to the MFSA’s Investment Services Rules. These include two new ‘chapters’ entitled: Part BIII – Standard Licence Conditions applicable to Investment Services Licence Holders which qualify as AIFMs and Part BIV – Standard Licence Conditions applicable to Custodians of Collective Investment Schemes. Click here for more information about Malta’s implementation of AIFMD.