Important Changes To Authorisation Process For Irish Domiciled Qualifying Investor Funds

Author:Mr David Dillon
Profession:Dillon Eustace
 
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Introduction

The Irish Funds Industry Association has announced this afternoon

a hugely significant and extremely positive change in the authorization process

for Irish domiciled qualifying investor funds (ìQIFsî).

The QIF authorization process, as well as its product parameters,

are to be changed to accelerate the time to market and otherwise improve the

attractiveness of the QIF product.

QIFs will now be capable of being authorised by the Financial

Regulator on a filing only basis which will mean that there will no longer be a

prior review of QIF fund documentation and a QIF meeting the pre-agreed

parameters can file for authorization on Day X and authorization will issue on

Day X+1.

New Irish Regulatory Regime

Following discussions over the last number of months between

industry representatives and the Financial Regulator, new authorisation

processes and enhanced product parameters for QIFs have been announced this

afternoon.

QIFs are non-UCITS products available as investment companies,

unit trusts or common contractual funds (single or umbrella with segregated

liability) which have a minimum subscription requirement per investor of Euro

250,000 (or equivalent) and which can be sold only to qualifying investors -

individuals with a minimum net worth of Euro 1.25 million (excluding principal

private residence/contents) or institutions who own or invest on a discretionary

basis at least Euro 25 million (or are themselves owned by qualifying

investors).

QIFs are the vehicles which are most frequently used in the

alternative space - hedge funds, fund of hedge funds, venture capital/private

equity, real estate funds etc - and are a mainstay of the non-UCITS Irish

domiciled product offering.

The new authorisation regime will provide that, subject to meeting

pre-agreed parameters, a QIF will now be capable of being authorised by the

Financial Regulator on a filing only basis so that once a complete application

for authorisation is received by the Financial Regulator before 3.00pm on Day

X, a letter of authorisation for the QIF can be issued by the Financial

Regulator on Day X +1.

There will no longer be a prior review process.

A complete application will be one where all the relevant parties

to the QIF (promoter, directors and relevant service providers) are all

approved (i.e. have the appropriate authorisations/approvals from the Financial

Regulator) and the QIF itself reflects the agreed parameters. The agreed

parameters have been...

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