Knowledge Base
Interpret regulatory obligations for management company licensing and fund manager independence
What is the minimum threshold of assets under management to benefit from the AIFM passport without leverage?
The AIFM passport is available to companies managing assets exceeding the thresholds of 100 million euros with leverage or 500 million euros without leverage. This threshold is crucial for understanding the conditions for cross-border operations.
What is the fundamental condition for obtaining authorisation as a portfolio management company under Article L. 532-9 of the Code monétaire et financier?
Authorisation is a sine qua non condition for carrying out management activities, and not a mere administrative formality. This means that any legal entity wishing to manage UCITS or AIFs must obtain this prior authorisation, as specified in Article L. 532-9. The relevant interpretive texts include AMF Instruction DOC-2008-03 and Position-Recommendation DOC-2012-19.
The risk management function must always be hierarchically and functionally separated from operational units, without exception.
Although the principle of hierarchical and functional separation is general, the proportionality principle allows for derogations if the nature and complexity of the activity do not require such separation. These derogations must be justified to the AMF.
The minimum capital required for a portfolio management company is 125,000 euros, fully paid up in cash.
In accordance with Articles 317-2 to 317-4 of the AMF General Regulation, the minimum required capital is indeed 125,000 euros, fully paid up in cash. This point is crucial for understanding the financial requirements imposed by the regulator.
Four-eyes rule
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The fourth authorisation condition requires effective management by at least two persons, commonly known as the four-eyes rule. This cumulative requirement covers the integrity and adequate experience of the executives, verified through examination of criminal records and professional background.
For how long are redemptions locked for a company benefiting from the AIFM passport?
For companies benefiting from the AIFM passport, redemptions are locked for five years. This provision is essential for understanding the specific conditions attached to this passport.
Categorize items by dragging them to the appropriate zones
Items to categorize:
Organisational measures to prevent conflicts of interest
Internal control procedures
Remuneration policy
Independence obligations include concrete organisational measures such as Chinese walls, separate oversight, and the elimination of direct links between remuneration. These measures aim to prevent conflicts of interest and protect the integrity of management decisions.
According to Article L. 532-9, paragraph II, what is the first condition that the AMF verifies before granting authorisation?
The first condition requires that the registered office and effective management be located in France. This implies both a statutory registered office and an effective decision-making centre on French territory, excluding shell structures. This interpretation is essential for understanding the regulator's expectations.