Marketing under the Alternative Investment Fund Managers Directive (AIFMD) Passport and Application To Non-EU Countries AIF Platforms Definition of Marketing Pre-Marketing, Soft Marketing Reverse Enquiry Approach across Europe Private Placement Gold-Plating across Europe

2. Overview
Marketing under the Alternative Investment Fund Managers Directive
(AIFMD)
• Passport and ApplicationTo Non-EU Countries
• AIF Platforms
• Definition of Marketing
• Pre-Marketing, Soft Marketing
• Reverse Enquiry
• Approach across Europe
• Private Placement
• Gold-Plating across Europe

3. Passport and ApplicationTo Non-EU Countries
• Main tenet of AIFMD is passport throughout Europe, granted as at today
only to fully compliant EU managers and EU AIFs
• AIFMD passport based on the UCITS passport
• Mechanisms for recognition of third countries and application of passport
• ESMA advice based on the assessment of the following:
• Investor Protection
• Market Disruption
• Market Competition
• Monitoring of Systemic Risk
• Delegated act of European Commission

4. AIF Platforms
• Platform solutions became very popular with advent of AIFMD
• Ability to passport if the structure is fully European
• Upsides
• Enhanced perception and marketability due to passport
• Shorter time to market than if own fund is built
• Ability for the AIFM platform to delegate to the non-EU manager the management of
the portfolio
• Downsides
• Cost (fee charged per AUM)
• Loss of independence over the fund
• No goodwill
• Potential remuneration issues to consider for foreign manager

5. Definition of Marketing
• Marketing means a direct or indirect offering or placement at the
initiative of the AIFM or on behalf of the AIFM of units or shares of an
AIF it manages to or with investors domiciled or with a registered
office in the Union
• Marketing is not defined at European but at local level
• Professional investors only, but retail may be allowed at local level
• Also through third parties
• Third party marketers
• Pension fund consultants
• Cap intro

6. Pre-Marketing, Soft Marketing
• Regulated at local level with various approaches
• The concept of pre-marketing
• Carried out to gauge investor interest
• No final or subscription documents
• No AIF in place or approved
• No name of the AIF
• Inability of investors to commit or subscribe
• It may not amount to marketing but eliminates reverse enquiry
• French examples with thresholds of investor and investment size

7. Reverse Enquiry
• Initial draft of AIFMD proposed prohibition on reverse enquiry, however incorporated under recital 70 final
version AIFMD.
• Regulated at local level, varied approach across Europe.
• Relationship Approach vs.Transaction Approach
• Websites
• Password protected
• Product by product access
• No Performance
• Not visible in countries where regime is unfavourable/no language version accordingly
• Newsletters
• Only individual funds
• Avoid mentioning new or additional funds
• Compliance burden, document the trail and story of each transaction
• Beware of investors or regulators?

8. Approach Across Europe
Country Pre-Marketing/Soft-
Marketing
Reverse Enquiry
Ireland Currently no distinction
between marketing and pre-
marketing.
Reverse enquiry is contemplated, although it is
envisaged that Central Bank of Ireland will
interpret it strictly and unfavourably. It is advisable
to have at all time evidence of the initiative of the
investor.
Austria Marketing includes pre-
marketing and soft-marketing
provided that sufficient
information is given to investor.
Reverse enquiry is contemplated, subject to it
being genuinely at the request of the prospective
investor and on a specific strategy or fund. Has to
relate to a specific AIF or strategy.
Germany BaFIN takes the view that
marketing occurs if the AIF a) is
established; b) has a name; c)
terms allow for immediate
subscription.
Reverse enquiry is contemplated towards
professional and semi-professional investors and
does not necessarily have to relate to a specific
fund. Each transaction needs to be preceded by a
reverse enquiry.

9. Approach Across Europe
France Contact made with up to 50
professional or private investors,
whose initial subscription would be
at least Euro 100,000, to assess
interest prior to launch of fund is
not considered marketing, provided
investors are not given any
subscription document or other
documentation containing definitive
information on fund characteristics.
Subsequent subscriptions are
considered marketing.
Reverse enquiry is contemplated
and does not necessarily have to
relate to a specific fund. Each
transaction needs to be preceded
by a reverse enquiry.

10. Approach Across Europe
United Kingdom All discussions entertained with
investors on the basis of draft
documentation would not amount
to an offer where such documents
cannot be used to make an
investment.
Reverse enquiry is contemplated
and requires to be substantiated
that a confirmation from investor is
provided to the extent that offer or
placement was made at its
initiative.
The Netherlands Providing fund documents in draft
form or with no option to
subscribe is not considered
marketing.
Reverse enquiry is contemplated,
provided that it is carried out at
the exclusive initiative of the
investor.
Finland Activities which do not include
offering units nor are aimed at
obtaining binding commitments
from investors may not be
considered marketing
In order to enforce reverse enquiry
there should be no discussion on
the actual investment between the
manager and the investor prior to
the approach made by the investor.

11. Approach Across Europe
Sweden Marketing cannot be construed
unless AIF actually is in existence.
All such activities conducted before
a fund vehicle meets the criteria to
be an AIF should not be considered
as marketing and contact with
investors in these situations as well
Reverse enquiry can be construed
when investor approaches on its
own an AIFM to make a
subscription and the company
website is not directed specifically
to Swedish investors nor contains
specific information about that AIF
Denmark Introductory meetings with
potential investors will not be
considered marketing if i) the fund
is not established; ii) no fund
document has been prepared; iii)
investors cannot make subscription.
Reverse enquiry is contemplated
under local AIFM law, provided that
the manager can document and
substantiate at all times that it was
the investor to initiate the
commitment to invest in an AIF.
Norway Only invitations to purchase funds
are considered marketing.
Reverse enquiry is allowed, subject
to first approach made by investor.

12. Approach Across Europe
Luxembourg Pre-marketing activities are
permissible in Luxembourg,
provided that the material used for
these activities i) is in draft form; ii)
cannot be used to subscribe or
commit to an investment; and iii)
also states that the AIF has not
been approved yet, depending on
circumstances.
Reverse enquiry is allowed and
managers have to prove that
investors subscribed at their own
initiative without any direct or
indirect solicitation made by the
manager.
Belgium There is currently no distinction
between marketing and pre-
marketing.
Reverse enquiry contemplated, but
need to be at the exclusive
initiative of the investor.

13. Private Placement
• The Private Placement is not private anymore
• From safe-harbour rule to process with the regulator
• Article 42 AIFMD – private placement conditions
• Transparency requirements
• disclosure to investors
• annual report
• reporting to regulatory authorities – Annex IV
• Cooperation
• Non FATF blacklist
• Option for gold-plating of the conditions above in AIFMD

14. Gold-Plating across Europe
• Appointment of depositary-lite entity
• Austria, Germany, France, Denmark
• Appointment of local agent/representative
• Austria, France
• Additional documentation and requirements
• Luxembourg – compliance with ESMA guidelines on remuneration
• The Netherlands – AIFM Home State certification of compliance with
cooperation agreement
• Denmark – reciprocity statement from AIFM Home State authority that it will
allow private placement from Danish AIFs

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