• The final Trilogue meeting to discuss AIFMD 2.0 under the Swedish Presidency of the Council of the EU, scheduled for 26 June, was cancelled.
• AIFMD 2.0 will not be finalised under the Swedish Presidency.
• The next Trilogue meeting to continue discussions on AIFMD 2.0 is likely to take place in September, under the Spanish Presidency of the Council.

As noted in our earlier OnPoint¹, on 25 November 2021, the European Commission (the Commission) set out its proposals to review the Alternative Investment Fund Managers Directive (AIFMD)² (the Proposals)³ (and, to the relevant extent, the UCITS Directive)⁴. The Council of the EU Europe (the Council) formalised its position with regards to the Proposals in June 2022⁵ and the European Parliament finalised its position with regards to the Proposals in January 2023.⁶

As noted in our recent OnPoint,⁷ the Commission, the Council and the European Parliament have been debating the various issues via the Trilogue process to agree the text of a directive that would amend AIFMD (AIFMD 2.0). The Swedish Presidency of the Council indicated that it hoped the Trilogue process will be completed by the end of June 2023, when its term ends.

The first Trilogue meeting took place on 8 March 2023, the second meeting took place on 9 May (postponed from 19 April), and the third meeting took place on 13 June.

While some progress was made in the Trilogue discussions, there are issues on which the co-legislators are not aligned and on 23 June, the Swedish Presidency announced that the final Trilogue of its Presidency – scheduled for 26 June – would not be taking place.

The main point of disagreement is with regards to loan originating funds, specifically (i) the definition of a loan originating fund, (ii) whether there should be a leverage limit, and if so, what should that limit be and how should it be calculated and (iii) risk retention. Disagreements also remain on the issues of delegation, the depositary passport, white-label services and undue costs.

The AIFMD 2.0 file will now be taken up by the Spanish Presidency of the Council which takes over from 1 July until the end of the year. The current understanding is that the next Trilogue meeting will take place in September, although this remains to be confirmed.

Timing

The delay in finalizing AIFMD 2.0 will impact its effective date. Assuming agreement in Q3 2023, after procedural formalities and translation, AIFMD 2.0 might take effect in Q1 2026.

The timeline suggested above is an example only. We will continue to monitor developments and the progress of the Trilogue process.

1. Our OnPoint “AIFMD – the EU Commission publishes its proposals for reform of the AIFMD” is available here.
2. Directive 2011/61/EU.
3. The Proposals for AIFMD are available here.
4. Directive 2009/65/EC.
5. The Council’s position is available here.
6. The Parliament’s final report setting out its position with regards to the Commission’s Proposals is available here.
7. Our OnPoint “AIFMD 2.0 – The Negotiations Begin” is available here.