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Funds Update - Consultation on the NAIF Regime - August 2017

The MFSA has issued a consultation document on proposed amendments to the Notified Alternative Investment Fund (NAIF) Regime and requested feedback from interested parties on certain proposed updates to the said regime. One key proposed change relates to the possible extension of the regime to cover Alternative Investment Funds (‘AIFs’) investing in immovable property or infrastructure, which type of funds are currently excluded from the scope of the NAIF framework. The MFSA’s current Property Funds Policy would, in this regard, no longer apply for AIFs but is proposed to continue to apply solely and exclusively to Professional Investor Funds.  The MFSA is also seeking feedback on the possibility of extending the NAIF framework also for funds investing in non-financial assets.

Some other updates to the Rules are also being proposed by the MFSA, namely to:

-     Rule 11.06 to require relevant disclosure in case of non-compliance with the Corporate Governance Manual for Directors of Investment Companies and Collective Investment Schemes;

-     Rule 11.09 to require the submission by a Maltese AIFM of the updated Terms of Reference and Risk Management Policy and any relevant updates to the Valuation Policy and Procedures;

-     Rule 11.27 to clarify to whom the money laundering reporting function may be delegated;

-     Rule 11.43 to clarify that changes to the prospectus shall not become effective until they are noted by MFSA.

The MFSA has also indicated that it is reviewing the Continuation of Companies Regulations, to possible provide for the re-domiciliation and continuation of schemes into Malta as a NAIF, as well as the Investment Services Act (Prospectus of Collective Investment Schemes) Regulations and the Investment Services Act (Performance Fees) Regulations.


The Notified AIF regime was launched by the MFSA in April 2016. It is a framework applicable solely for Alternative Investment Funds (‘AIFs’) based in Malta and managed by a full-scope Maltese or EU Alternative Investment Fund Manager authorised under the AIFM Directive, where such manager undertakes responsibility for the AIF and for the fulfilment of its obligations under the NAIF framework. The Notified AIF regime is particularly attractive from a time to market point of view and is one which is gaining increasing attention when it comes to the setting up of an AIF structure. For further details on the NAIF regime or other financial services related enquiries please contact us on info@dfadvocates.com or telephone +356 21313930/ 21340401.