Last Updated on September 10, 2024 by Arnaud Collignon
https://www.consilium.europa.eu/media/67845/st14932-en23.pdf
Directive of the European Parliament and of the Council amending Directives 2011/61/EU and 2009/65/EC as regards delegation arrangements, liquidity risk management, supervisory reporting, provision of depositary and custody services and loan origination by alternative investment funds (AIFMD).
Discover our AIFMD Annex IV solution:
The Article 24 is amended as follow:
Reporting obligations to competent authorities
1. An AIFM shall regularly report to the competent authorities of its home Member State on the principal markets and instruments in which it trades on behalf of the AIFs it manages. It shall provide information on the main instruments in which it is trading, on markets of which it is a member or where it actively trades, and on the principal exposures and most important concentrations of each of the AIFs it manages.
It shall, in respect of each AIF it manages, provide information on the instruments in which it is trading, on markets of which it is a member or where it actively trades, and on the exposures and assets of the AIF. That information
shall include the identifiers that are necessary to connect the data provided on assets, AIFs and AIFMs to other supervisory or publicly available data sources.’;
2. An AIFM shall, for each of the EU AIFs it manages and for each of the AIFs it markets in the Union, provide the following to the competent authorities of its home Member State:
(a) the percentage of the AIF’s assets which are subject to special arrangements arising from their illiquid nature;
(b) any new arrangements for managing the liquidity of the AIF;
(c) the current risk profile of the AIF and the risk management systems employed by the AIFM to manage including the market risk, liquidity risk, counterparty risk and other risks including operational risk;
(d) information on the main categories of assets in which the AIF invested; and
information regarding delegation arrangements concerning portfolio management or risk management functions as follows:
- information on the delegates, specifying the delegates’ name and domicile, whether they have any close links with the AIFM, whether they are authorised or regulated entities for the purpose of asset management and where relevant, their supervisory authority, including the identifiers of the delegates that are necessary to connect the information provided to other supervisory or publicly available data sources;
- the number of full-time equivalent human resources employed by the AIFM for performing day-to-day portfolio or risk management tasks within the AIFM; 2a) a list and description of the activities concerning risk management and portfolio management functions which are delegated;
- where the portfolio management function is delegated, the amount and percentage of the AIF’s assets which are subject to delegation arrangements concerning the portfolio management function;
- the number of full-time equivalent human resources employed by theAIFM to monitor the delegation arrangements;
- the number and dates of periodic due diligence reviews carried out by the AIFM to monitor the delegated activity, a list of issues identified and, where relevant, the measures adopted to address those issues and the date by which those measures are to be implemented
- where sub-delegation arrangements are in place, information required in points (1), (2a) and (3) in respect of the sub-delegates and the activities related to the portfolio and risk management functions that are sub-delegated;
- the commencement and expiry dates of the delegation and sub-delegation arrangements.;
(e) the results of the stress tests performed in accordance with point (b) of Article 15(3) and the second subparagraph of Article 16(1).
(f) the list of Member States in which the units or shares of the AIF are actually marketed by the AIFM or by a distributor which is acting on behalf of that AIFM.;
3. The AIFM shall, on request, provide the following documents to the competent authorities of its home Member State:
(a) an annual report of each EU AIF managed by the AIFM and of each AIF marketed by it in the Union, for each financial year, in accordance with Article 22(1);
(b) for the end of each quarter a detailed list of all AIFs which the AIFM manages.
4. An AIFM managing AIFs employing leverage on a substantial basis shall make available information about the overall level of leverage employed by each AIF it manages, a break-down between leverage arising from borrowing of cash or securities and leverage embedded in financial derivatives and the extent to which the AIF’s assets have been reused under leveraging arrangements to the competent authorities of its home Member State.
That information shall include the identity of the five largest sources of borrowed cash or securities for each of the AIFs managed by the AIFM, and the amounts of leverage received from each of those sources for each of those AIFs.
For non-EU AIFMs, the reporting obligations referred to in this paragraph are limited to EU AIFs managed by them and non-EU AIFs marketed by them in the Union.
5. Where necessary for the effective monitoring of systemic risk, the competent authorities of the home Member State may require information in addition to that described in this Article, on a periodic as well as on an ad-hoc basis. The competent authorities shall inform ESMA about the additional information requirements.
In exceptional circumstances and where required in order to ensure the stability and integrity of the financial system, or to promote long-term sustainable growth, ESMA after consulting the ESRB may request the competent authorities of the home Member State to impose additional reporting requirements.
6. The Commission shall adopt, by means of delegated acts in accordance with Article 56 and subject to the conditions of Articles 57 and 58, measures specifying:
(a) when leverage is to be considered to be employed on a substantial basis for the purposes of paragraph 4; and
(b) the obligations to report and provide information provided for in this Article.
Those measures shall take into account the need to avoid an excessive administrative burden on competent authorities.
ESMA shall develop draft regulatory technical standards specifying:
(a) the details of the information to be reported according to paragraph 1 and paragraph 2, points (a) to (c) and (e) to (f);
(aa) the appropriate level of standardisation of the information to be reported according to paragraph 2, point (d);
(b) the reporting frequency and timing
When drafting the regulatory technical standards referred to in point (aa), ESMA shall not introduce reporting obligations additional to those set out in paragraph 2, point (d). When drafting the regulatory technical standards referred to in points (a) and (aa), ESMA shall take into consideration other reporting requirements to which the AIFMs are subject, international developments and standards, and the findings of the report issued in accordance with Article 69b(2). ESMA shall submit those draft regulatory technical standards to the Commission by … [36 months after the date of entry into force of this amending Directive]. Power is delegated to the Commission to supplement this directive by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.
7. ESMA shall develop draft implementing technical standards specifying:
(a) the format and data standards for the reports referred to in paragraphs 1 and 2;
(aa) the legal identifiers that are necessary to connect the data in those reports on assets, AIFs and AIFMs to other supervisory or publicly available data sources;
(ba) methods and arrangements for submitting the reports referred to in paragraphs 1 and 2, including methods and arrangements to improve data standardisation and efficient sharing and use of data already reported in any Union reporting framework by any relevant competent authority, at Union or national level, taking into account the findings of the report issued in accordance with Article 69b(2);
(bb) the template, including the minimum additional reporting requirements, to be used by AIFMs in exceptional circumstances as referred to in paragraph 5.
ESMA shall submit those draft implementing technical standards to the Commission by … [36 months after the date of entry into force of this amending Directive]. Power is conferred on the Commission to adopt the implementing technical standards referred to in the first subparagraph in accordance with Article 15 of Regulation (EU) No 1095/2010.
8. The Commission shall adopt delegated acts in accordance with Article 56 and subject to the conditions of Articles 57 and 58 to supplement this Directive by specifying when leverage is to be considered to be employed on a substantial basis for the purposes of paragraph 4.’;
