AIFM licences

Alternative investment fund managers need a licence. To qualify for a licence, you must have a definite intention to perform activities that are subject to a licensing obligation. You can demonstrate this because you are already active as an exempt manager or because you have made preparations for managing and offering one or more alternative investment institutions.

Conditions

To obtain a licence, you must be able to demonstrate that you comply with a large number of conditions from the time you perform activities that are subject to a licensing obligation. These conditions include activities of the manager, such as:

- transparent control structure
- controlled and sound business operations
- policy to prevent and manage conflicts of interest
- careful delegation
- controlled remuneration
- solvency and liquidity

Registration as alternative investment vehicle(s) includes an examination of investor disclosures. When registering as a depositary, consideration is given to whether it is appropriate for specific investment fund(s). When registering persons to be assessed with the manager, alternative investment fund(s) and depository, the assessment will include – (day-to-day) policymakers being fit and proper, (possible) supervisory directors and holders of qualifying holdings of/in the manager.

Costs and terms
The AFM charges €200 per hour for AFM activities up to a maximum of €100,000.

The AFM must make a decision within 13 weeks of receiving the licence application. This period can be extended by 13 weeks. Once the AFM requests further data or information to supplement the licence application, the decision period is suspended until the AFM receives the requested information. If the AFM does not receive an (adequate) supplement to the application before the deadline it has set, it may decide to leave the licence application unprocessed or put it on hold.

Licence application for Investment firm without separate manager

A licence application for an investment firm without a separate manager is subject to the same conditions, fees and deadline as a licence application for an alternative investment firm manager. (As described above.)

Licence application for ELTIF with internal manager

By virtue of Article 5 of Regulation (EU)2015/760, alternative investment fund managers need a licence from the AFM to offer European long-term investment funds. To qualify for a licence, you must have a definite intention to perform activities that are subject to a licensing obligation.

Costs and terms
The AFM charges €200 per hour for AFM activities up to a maximum of €100,000.

The AFM must make a decision within three months of receiving the licence application. Once the AFM requests further data or information to supplement the licence application, the decision period is suspended until the AFM receives the requested information. If the AFM does not receive an (adequate) supplement to the application before the deadline it has set, it may decide to leave the licence application unprocessed or put it on hold.

Licence application for ELTIF with external manager

By virtue of Article 5 of Regulation (EU)2015/760, alternative investment fund managers need a licence from the AFM to offer European long-term investment funds. To qualify for a licence, you must have a definite intention to perform activities that are subject to a licensing obligation.

Costs and terms
The AFM charges €200 per hour for AFM activities up to a maximum of €100,000.

The AFM must make a decision within two months of receiving the licence application. Once the AFM requests further data or information to supplement the licence application, the decision period is suspended until the AFM receives the requested information. If the AFM does not receive an (adequate) supplement to the application before the deadline it has set, it may decide to leave the licence application unprocessed or put it on hold.

Relevant links

Alternative investment fund manager licence application

A manager that is already licensed may wish to have its licence extended because it wants to start managing other types of AIFs (with other types of investments).

In principle, a licence is issued specifically to manage one (or more) type(s) of AIF(s). A manager that is already licensed may wish to have the scope of its licence extended because it wants to start managing other types of AIFs (with other types of investments).

Extend the scope of a licence of alternative investment fund manager

For example, you are licensed as a manager of an AIF investing in financial instruments. If the intention arises to also manage an AIF that invests in real estate, you must apply for an extension of the scope of a licence to do so. A manager can extend the scope of an existing licence if it also wants to provide investment services. In addition, a manager offering and/or managing or wishing to manage and/or offer a Money Market Fund (MMF) must apply once to the AFM for an extension of the scope of its licence for this purpose.

Conditions
To qualify for an extension of the scope of a licence, you must also demonstrate for the new type of AIF to be managed that you can meet the requirements imposed on it by legislation and regulations. In any case, the following conditions must be met:

- at least one day-to-day policymaker must be suitable for the types of investments with which the licence is extended.
- the description of business operations must be adapted to the new types of AIF(s)/types of investments.
- a suitable depositary must be/has been appointed for each managed investment fund.

Costs and terms
The cost of a licence extension is €10,500 per request.

The AFM must make a decision within 13 weeks of receiving the extension application. This period can be extended by 13 weeks. Once the AFM requests further data or information to supplement the licence extension, the decision period is suspended until the AFM receives the requested information. If the AFM does not receive an (adequate) supplement to the application before the deadline it has set, it may decide to leave the licence application unprocessed or put it on hold.

Extension of licence for management of Money Market Funds

With effect from 21 January 2019, it is no longer permitted to manage or offer Money Market Funds (MMFs) without having applied for a licence extension and the relevant MMFs having been registered with the AFM. A manager offering and/or managing or wishing to manage and/or offer an MMF must apply once to the AFM for an extension of the scope of its licence for this purpose.

Conditions
To obtain an extension of your licence, you must be able to demonstrate that you meet the conditions arising from the Money Market Fund Regulation (MMFR), these conditions concern for example:

- knowing your client policy
- internal credit quality assessment process
- data reporting obligations

A manager must not only extend its licence, but separately notify all its offered and/or managed MMFs. To register an MMF with the AFM, you must be able to demonstrate that you meet the requirements arising from the MMFR. This includes requirements for:

- the investment policy
- the valuation methodology

If you do not yet hold a licence or if it concerns a new (sub)fund, you must first apply for a licence as a manager and/or register the (sub)fund.

Costs and terms
The AFM charges fees for both the application for the licence extension to manage the MMF and the reporting of the MMF:

Licence extension: €2500
Reporting of an MMF: €2500 per reported MMF

The statutory processing time for the application is two months.

If you want to cease your activities, you must apply for withdrawal of the entire licence.

If you wish to cease operating as an AIFM manager or AIFM investment firm without a separate manager, you must apply for withdrawal of the entire licence.

Full licence withdrawal of investment fund

The information you need to submit with an application for withdrawal of a licence depends partly on the reason for ceasing operations as a manager. You must always give reasons for your application for withdrawal, demonstrating, for example, that no activities requiring a licence are or will be performed by the manager after the licence has been withdrawn.

With the licence withdrawal application, you must provide at least the following documents:

- statement by the manager
- statement by the depositary
- covering letter

A licence withdrawal is free of charge. The ongoing regulatory fees will be charged until the date of withdrawal of your licence (pro rata).

Withdrawal of ELTIF licence

If you wish to cease your activities as a manager of a European long-term investment fund (ELTIF), you must apply for the withdrawal of this licence.

The information you need to submit with an application for withdrawal of a licence depends partly on the reason for ceasing operations as a manager. You must always give reasons for your application for withdrawal, demonstrating, for example, that with respect to the ELTIF no activities requiring a licence are or will be performed by the manager for the management of an ELTIF after the licence has been withdrawn.

With the ELTIF licence withdrawal application, you must upload at least the following documents:

- statement by the manager
- statement by the depositary
- covering letter

A licence withdrawal is free of charge.