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MFSA Launches “Notified AIF” Regime

By 1st July 2016No Comments

The MFSA held an information session on the 1st April 2016 which detailed a proposal to simplify Malta’s current fund regime and launch a new framework for the notification of Alternative Investment Funds.

In order to improve the overall competitiveness of the Maltese funds market and enhance the efficiency of the authorisation process, the MFSA will be undergoing a complete regulatory review of the current fund regime namely through a:

•             Consolidation of the currently available fund regimes

•             Review of the fund authorisation processes

•             Revamp of fund application forms and related rulebooks.

A key reform in this regard will be the elimination of the ‘Experienced Investor Fund’ category and the simultaneous fusion of the ‘Qualifying Investor Fund’ and the ‘Extraordinary Investor Fund’ categories.

Therefore, a new Qualifying Investor Fund category will be introduced with the following eligibility criteria:

•             A minimum investment threshold of EUR100, 000

•             The investor must be an entity or individual with assets in excess of EUR750,000 or the currency equivalent and/or senior fund personnel

•             A written declaration that the Qualifying Investor is aware of and accepts the risks of the proposed investment.

The MFSA has also proposed a simplification of the Retail fund sector by limiting such structure to the categories of UCITS and Retail AIFs.

Therefore it is expected that following this revamp Malta’s fund sector will compromise of:

•             Two Retail Fund options : UCITS and Retail AIFs

•             One Professional Investor Fund option: Qualifying Investor PIFs

•             Three Alternative Investor Fund options: Retail AIFs, Qualifying Investor AIFs and Notified AIFS.

The new Notified AIF option will be solely available to qualifying or professional investors which are managed by a Maltese or EEA passported full-scope AIFM. Therefore the regime will not be available to Self-managed AIFs, AIFS that are not marketed and sold to qualifying and/or professional investors, loan funds and AIFs investing in ‘non-financial’ assets.

Notified AIF’s shall be the full responsibility of the AIFM and will not be subject to any authorisation or approval by the MFSA. The Authority however, shall keep a record of all Notified AIFS on their website.

The AIFM is to submit any requests for notification to the Authority together with the following documents:

•             A compliant prospectus

•             A resolution of the AIF governing body certifying such prospectus

•             An AIFM self-certification confirming that it has the necessary competence and experience to manage and monitor the AIF;

•             A joint AIFM/AIF governing body declaration undertaking responsibility for the AIF and its continuing compliance with the AIFM Directive;

•             A declaration by the AIFM confirming that it has carried out the necessary due diligence in respect of the AIF’s governing body and service providers.

It is estimated that once all the relevant documents are submitted, the Authority should place the AIF on the notified list within 10 days.

Further information on such restricting is available at:

 http://www.mfsa.com.mt/pages/announcements.aspx?id=2