The European Securities and Markets Authority (ESMA) released final guidelines on exactly what GPs need to report to their local regulators under the Alternative Investment Fund Managers Directive (AIFMD).
One legal source said the guidelines confirmed what the industry was expecting from the pan-EU regulator. He stressed that reporting rules under the directive “carry a significant compliance burden” and the guidelines help clarify what GPs must report to local regulators.
Specifically, the guidelines state that GPs must report: the breakdown of their funds' investment strategies; the main markets/ instruments their funds trade on; the total value of assets under management of each fund; turnover of the funds; and the principal exposures and portfolio concentration of the funds.
GPs reporting periods differ depending on what type of fund manager they are and what type of fund they have. For example, GPs with unleveraged funds will report on an annual basis.
Included in the guidelines were recommendations for individual EU member states to adopt additional reporting requirements on how the fund measures risk, the liquidity profile of the funds and exactly how much leverage the fund carries.
The guidelines are designed in part to standardize GPs' reporting requirements across all 28 member states of the EU, said Steven Maijoor, ESMA chairman, in a statement. Once the guidance is translated into the official languages of the EU, national regulators will have two months from the date of translation to confirm to ESMA whether they comply or intend to comply with the guidance.
In addition, ESMA soon will publish technical supporting material (a consolidated reporting template and detailed IT guidance for filing) that were made to help smooth the reporting process between GPs and regulators.
Click HERE to view ESMA’s AIFMD reporting guidance.