Hedge Fund Law Report Publishes Akin Gump Article Discussing New EU Cross-Border Distribution of Funds Rules

Hedge Fund Law Report has published the article “The New E.U. Cross‑Border Distribution of Funds Rules.” Written by Akin Gump partner Ezra Zahabi, with assistance from associate Andrea Gonzaga, the article discusses new European Commission rules on the cross-border distribution of funds (CBDF Rules) as they relate to “pre-marketing activities, reverse solicitation, marketing to non-professional investors and marketing communications.”

The article, adapted from an Akin Gump client alert, notes that the new rules “are intended to remove regulatory obstacles that prevent more active cross-border flow of capital within the E.U.” At the same time, Zahabi writes, they are also designed to introduce “regulatory certainty to allow for more market testing activity, so fund managers can confirm investor interest before embarking on marketing registration under the Alternative Investment Fund Managers Directive (AIFMD) and its attendant regulatory requirements.”

The CBDF Rules took effect August 2 and, while equivalent rules are not currently being implemented in the U.K., the article states that they “are likely to have at least some impact on many U.K. managers’ marketing activities in the E.U.” Zahabi also advises U.S. and other non-E.U. managers to assess what impact the rules may have on them.

To read the original client alert on which the article is based, please click here.