The MFSA launched a framework on 1st April 2016 for the establishment of Notified Alternative Investment Funds [NAIFs]; the primary objective being to create innovative structures in conformity with relevant Directives, besides promoting Malta as an attractive jurisdiction.
Following the publication of the regime regulating the NAIFs, the Authority, whilst making sure that the framework for NAIFs kept developing within the framework of the AIFMD, reviewed the said regime within 12 months of publication.
As a result, the MFSA has been publishing proposals to revamp and strengthen the NAIF Rules keeping present the regulatory obligations of the AIFM in terms of the AIFMD.
Key Amendments made to the NAIF Rules
- SLC 11.04 is being reviewed to allow for the possibility of NAIFs to invest directly in immovable property or infrastructure. The Authority has thus decided that the Property Funds Policy shall solely remain applicable with respect to Professional Investor Funds and Alternative Investment Funds since it shall no longer apply to NAIFs and regulated AIFs.
- The Authority is also seeking feedback from the industry on the possibility of extending the scope of the funds which can be established as NAIFs to those funds which invest in non-financial assets.
- Emphasis shall be made on the independence requirement of the Board of Directors of the NAIF.
- A formality to submit to the Authority a copy of the updated Terms of Reference and the Risk Management Policy (as applicable), following the listing of the NAIF.
- A revision shall be made to the required qualifications for one to be appointed as MLRO of the NAIF.
- Any amendments to the Prospectus shall become effective once they are acknowledged and noted by the MFSA.
Further Changes being Proposed
The Authority is currently reviewing the Continuation of Companies Regulations to provide for the possibility of continuing a scheme licenced in another jurisdiction as a NAIF upon completion of the re-domiciliation procedures.
The Investment Services Act (Prospectus of Collective Investment Schemes) Regulations (SL.370.04) and Investment Services Act (Performance Fees) Regulations (SL.370.12) are also being reviewed.
These proposals are not binding and are subject to changes and revisions following receipt of feedback from the industry.