On 12 September 2012 Matthew Elderfield, the deputy governor of the Irish Central Bank, addressed the IFIA Annual Global Funds Conference. Significantly, Mr Elderfield informed the conference that the Central Bank will use the implementation of the AIFMD as an opportunity for a systematic rethink of its non-UCITS regime.

The following proposals are under consideration:

• The establishment of a new category of fund based purely on the minimum standards of the AIFMD. The only domestic requirements imposed on this new type of fund would be those prevailing under existing Irish law
• An adjustment of the domestic standards for the qualifying investor fund (QIF) regime to reflect the AIFMD (e.g. currently there is a minimum initial subscription requirement of €100,000 for QIFs, while there is no such requirement under AIFMD)
• The removal of the current promoter requirement for QIFs.  (Currently, all Irish funds are required to have a fund “promoter” and the fund promoter requirements, including as to capital, are quite stringent

Mr Elderfield confirmed that the Central Bank will shortly consult publicly on these proposals.

He also informed the Conference that the Central Bank is reviewing its processes and turnaround times for fund authorisations with a view to moving towards receipt of documentation and information in electronic format. This initiative should shorten the time it takes to bring fund products to the market.

Finally, he set out the Central Bank’s view of the on-going debate on money market fund reform. He stated that requiring money market funds to switch from constant net asset value to variable net asset value would not adequately address the likelihood of an investor run on a money market fund.  Instead, the Central Bank is of the opinion that substantial reform can be achieved through a range of measures such as capital buffers, dilution levies for exiting investors and tighter liquidity requirements.

For further information, please contact one of the key contacts listed above or your usual contact in our Asset Management and Investment Funds Team.