BaFin interpretative notice regarding eligible investments for AIFs as real-estate companies
BaFin published a new interpretative notice on 9 April 2018, regarding the requirements for alternative investment funds (AIF) in order to qualify as eligible real-estate companies for German real-estate funds (Immobilien-Sondervermögen) pursuant to sec. 231 et seq. of the German Capital Investment Code (Kapitalanlagegesetzbuch – KAGB) and open-ended Special-AIFs with fixed investment guidelines (Spezial-AIF mit festen Anlagebedinungen) pursuant to sec. 284 KAGB.
In its interpretative notice, BaFin takes the view that also alternative investment funds could qualify as eligible real-estate companies under the definition of sec. 1 para. 19 no. 22 KAGB for German real-estate funds and open ended Special-AIFs, but highlights the importance of certain voting- and control rights as well as liquidity requirements which have to be ensured on the level of the alternative investment fund in order to qualify as real-estate company.
The interpretative notice primarily aims on the requirements for alternative investment funds as real-estate companies, but will from our perspective also have an impact on all other special-purposes vehicles and companies which shall qualify as real-estate companies holding real-estate for German real-estate funds (Immobilien-Sondervermögen) pursuant to sec. 231 et seq. KAGB and open-ended Special-AIFs with fixed investment guidelines (Spezial-AIF mit festen Anlagebedinungen) pursuant to sec. 284 KAGB.
Further BaFin notes that third-country or EU-AIFs which cannot comply with the requirements set out in this interpretative notice pursuant to the laws of its relevant home jurisdictions, will not qualify as real-estate companies for German real-estate funds.
Read the note in full (in German).
BaFin circular on minimum compliance requirements under MiFID II
BaFin published the long-awaited update of its “MaComp” Circular on 19 April 2018 that clarifies on the basis of the MiFID II regulatory framework the minimum requirements for the compliance function and additional requirements governing rules of conduct, organisation and transparency.
The requirements in the BaFin Circular apply especially to investment services enterprises and in a limited manner also to asset management companies to the extent that they provide certain services and ancillary services within the meaning of sec. 20 (2) of the German Capital Investment Code (Kapitalanlagegesetzbuch – KAGB). Asset management companies have to consider particular requirements of the BaFin Circular to the extent the corresponding provisions of sec. 63 et seq. of the German Securities Trading Act (Wertpapierhandelsgesetz – WpHG) apply. Asset management companies may therefore be obliged to observe among other things for example the legal requirements concerning the monitoring of personal account dealing of employees, the provisions relating to fair, clear and not misleading information, the obligations to ensure best execution of client orders or concerning the product governance requirements.
Read the BaFin Circular in full (in German)
Latest German fund statistics
The German Investment Fund Association, BVI, has issued its latest investment statistics report dated 16 April 2018, giving an overview of the net assets and net sales within the German investment fund and asset management markets. The statistics are broken down by asset class and provider. They provide information on net assets and net inflows of investment funds and assets outside investment funds.
The latest statistic report is highlighting that there are 6 Billion EUR invested into closed-ended funds in the German investment fund and asset management market; this is double the amount of investments since including closed-ended funds into the statistic report in December 2017. Further the German market is considered to be the biggest market for investment funds in Europe, having 2.6 Trillion EUR under management.
Acess the statistics in full.
