Segregation obligation - AIFMD Provision: Difference between revisions
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{{ | {{a|aifmd|}}Delegated Regulation {{aifmdprov|DR99}} relates to the {{aifmdprov|depositary}}’s obligation to segregate custody assets. | ||
In the main {{aifmdprov|DR99}} is of scant interest to [[prime broker]]s, though the {{aifmdprov|depositary}} might insist on copying screeds of the regulation out and popping it into the custody delegation contract. This is an understandable instinct, but a misguided one which you must all the same resist, for the simple reason that ''regulations change''. Even EU regulations. By all means refer to the obligations under {{aifmdprov|DR99}} as in force [[from time to time]], or something similarly laborious, as lopng as it tracks what the actual regulatory requirement is, for the time being, not what it was eight years ago when you signed your contract. | |||
An [[Negotiator|assiduous pedant]]<ref>I was surprised about this, too, but you do occasionally come across them negotiating prime brokerage documents.</ref> might also argue that {{aifmdprov|DR99}} doesn’t actually impose obligations, ''[[per se]]'', on the [[delegate]] [[sub-custodian]], but only on the {{aifmdprov|depositary}}, so the delegate should not have to give these reps, or agree to be subject to these regulations at all. | |||
You have the chance to do the whole world a favour here, by not being that guy. | |||
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Revision as of 18:46, 24 March 2020
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AIFMD Anatomy™
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Delegated Regulation DR99 relates to the depositary’s obligation to segregate custody assets.
In the main DR99 is of scant interest to prime brokers, though the depositary might insist on copying screeds of the regulation out and popping it into the custody delegation contract. This is an understandable instinct, but a misguided one which you must all the same resist, for the simple reason that regulations change. Even EU regulations. By all means refer to the obligations under DR99 as in force from time to time, or something similarly laborious, as lopng as it tracks what the actual regulatory requirement is, for the time being, not what it was eight years ago when you signed your contract.
An assiduous pedant[1] might also argue that DR99 doesn’t actually impose obligations, per se, on the delegate sub-custodian, but only on the depositary, so the delegate should not have to give these reps, or agree to be subject to these regulations at all.
You have the chance to do the whole world a favour here, by not being that guy.
References
- ↑ I was surprised about this, too, but you do occasionally come across them negotiating prime brokerage documents.