General responsibilities of depositary - AIFMD Provision

One of the core functions of the depositary, also required to be carried by a depositary lite.

Paragraph 21(7), AIFMD

AIFMD, 21(7)
21(7). The depositary shall in general ensure that the AIF’s cash flows are properly monitored, and shall in particular ensure that all payments made by or on behalf of investors upon the subscription of units or shares of an AIF have been received and that all cash of the AIF has been booked in cash accounts opened in the name of the AIF or in the name of the AIFM acting on behalf of the AIF or in the name of the depositary acting on behalf of the AIF at an entity referred to in points (a), (b) and (c) of Article 18(1) of Directive 2006/73/EC (EUR Lex), or another entity of the same nature, in the relevant market where cash accounts are required provided that such entity is subject to effective prudential regulation and supervision which have the same effect as Union law and are effectively enforced and in accordance with the principles set out in Article 16 of Directive 2006/73/EC (EUR Lex).
(view template)

Commentary

An entity described in Article 18(1) of the MiFID Implementing Directive is basically a propoerly regulated bank or credit institution.

---

21(7) in a Nutshell™ _{(AIFMD edition)}

21(7) Depositary obligations re cash: The depositary must ensure that:

AIF’s cashflows are properly monitored; and

subscription payments are properly received and all cash booked in the depositary’s accounts at a suitable bank

view template

---

AIFMD Anatomy™ →Go uptown {{{2}}} Directive 2011/61/EU (EUR Lex) | Implementing regulation 231/2013 (EUR Lex) Navigation directive - 21 (depositary) | 21(4) (conflict management) | 21(8) (custody function) | 21(11) (custody delegation) | 21(12) (liability for loss of assets) | 21(13) (discharge of liability on delegation) | 21(14) (discharge of liability for Non-EU subcustodians) | 36 (depo-lite) | 36(1) implementing regulation DR20 (Due diligence when appointing counterparties and prime brokers) | DR76 (objective reason) | DR89 (Safekeeping duties with regard to assets held in custody) | DR91 (reporting obligations for prime brokers) | DR98 (due diligence) | DR99 (segregation obligation) | DR100 (Loss of custody asset) | Tell me more Sign up for our newsletter — or just get in touch: for ½ a weekly 🍺 you get to consult JC. Ask about it here.