The French private equity and venture capital association AFIC has welcomed the decision by the French financial markets authority AMF to introduce the concept of “premarketing” and adapt its definition of what constitutes an act of marketing.
AFIC, which as part of the framework of the working group FROG (French [Routes & Opportunities] Garden) had defended the importance of recognising the premarketing concept in French law, considers that this change in AMF doctrine will facilitate the launch of new funds in France and improve the distribution of French funds abroad.
Already accepted in other European financial markets, premarketing sends a strong signal to international investors and will enhance the French financial market’s competitiveness, placing it on the same footing as Germany, Luxembourg, the UK and some of the Scandinavian countries. It will also facilitate communication flows between national and international institutional investors and the French private equity players.
This major regulatory step forward clarifies the situations that do not constitute the act of marketing of an investment fund. It gives fund managers greater leeway to gauge the interest of potential investors before launching a fund without this being considered as an act of marketing which, up to now, triggered the application of rules unsuited to the product development phase.
“We are very pleased with the flexibility introduced by the AMF with the new concept of premarketing, which will enable private equity players to assess, within a secure legal framework, the interest of potential investors and will facilitate the creation of funds that meet their expectations,” says Oliver Millet, chairman of AFIC.
