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RAIF law is a milestone for AIFMD regime

Kavitha Ramachandran (pictured), Senior Manager, Business Development and Client Management at Maitland, comments on the adoption the RAIF law in Luxembourg…

The launch of the RAIF is a very welcome development for the alternatives industry, and represents an important milestone in terms of the ‘bedding in’ of the new AIFMD regime. The switch from product to manager-focused regulation is one of the central planks of the AIFMD, so it makes no sense for the old now-redundant layer of product-focused regulation to remain in place – it amounts to regulating the same thing twice over. It doesn’t make investors any safer, but it does inhibit activity.
 
The new RAIF structure, to the credit of the Luxembourg authorities, recognises this, combining flexibility, quick time-to-market and the protections afforded by the AIFMD regime into one vehicle. It reflects the spirit of the AIFMD, could prove a boost to activity in Europe, and we are not surprised to see other jurisdictions following suit. And while the implications of Brexit for the UK’s status with the AIFMD are still totally uncertain, should it have a negative effect, the RAIF could put Luxembourg in an excellent position to acquire market share at the UK’s expense.

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