Depositary lite - AIFMD Provision: Difference between revisions

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 AIFMD, like many financial services regulations, is composed of a directive, but is supported by regulatory technical standards imposed by regulation. I’m sure there was a good reason for this, but I don’t have the energy to find out what it was.
-Now: AIFMD’s depositary lite regime is designed for ''innie'' fund managers — those resident ''inside'' the EU — marketing ''outie'' funds — funds incorporated ''outside'' the EU — to ''innie'' investors, resident in the EU.
+===== Basis between “Non-EU AIF” and “third country AIF”? We don’t think so. =====
+AIFMD’s depositary lite regime is designed for ''innie'' fund managers — those resident ''inside'' the EU — marketing ''outie'' funds — funds incorporated ''outside'' the EU — to ''innie'' investors, resident in the EU.
-UK, of course, used to be an innie, and the idea is, as nearly as possible, for all the damage Brexit has done, we remain an innie afterwards, with harmonised alternative fund management regulation. But there’s a little gap: a UK domiciled fund is an ''innie'' for UK AIFMD, but an ''outie'' for EU AIFMD. But conversely, an fund domiciled in the EU is an ''innie'' for the EU, but ''also an innie'' for the UK, because a “third country” AIF means one resident outside the EEA.
+UK, of course, used to be an innie, and the idea is, as nearly as possible, for all the damage Brexit has done, we remain an innie afterwards, with harmonised alternative fund management regulation.
+But there’s a little gap: a UK domiciled fund is an ''innie'' for [[UK AIFMR]], but an ''outie'' for EU AIFMD. But conversely, an fund domiciled in the EU is an ''innie'' for the EU, but ''also an innie'' for the UK, because a “third country” AIF means one resident outside the EEA.
+Now a “third country AIF” under UK regulations means one outside the UK ''and the EEA.'' But a “Non-EU AIF’ under AIFMD means just one outside just the EEA. So a UK-domiciled AIF would ''not'' be a “[[third country AIF]]”, but it ''would'' be a “[[Non-EU AIF - AIFMD Provision|Non-EU AIF]]’. This did my head in for a short while but the upshot is that ''this does not matter''. Here is why:
+Under EU [[AIFMD]], a UK AIF marketed under national private placement rules would qualify for EU depo-lite treatment, but it would ''not'' qualify for depo-lite treatment under UK rules — being its own primary regulation — so would have to appoint a full depositary the same way a fully blown EU AIF would anyway. The UK is saying, effectively, “''my'' Non-EU AIFs will behave as if they were EU AIFs, even though the EU regulations don’t require them to, because I require them to”.
+Which is nice.
 ==Depo-lite in general==