AIF passporting in Greece

EEA AIFMs are regulated by Law 4209 / 2013 (the “Law”) which implemented the AIFMD in Greece. Competent national authority to carry out the implementation of the AIFMD in Greece and to assume supervisory duties with regard to AIFM activity is the Hellenic Capital Market Commission (“HCMC”). As per the provisions of the AIFMD, the Law introduces the principle of one AIFM per AIF.

In particular, the Law covers the following AIFMs irrespective of the form of the AIFs managed:

• All Alternative Investment Funds Management Sociétés Anonymes (“AIFMSAs”) i.e., Greek AIFMs managing one or more AIFs;
• EU or non-EU AIFMs managing one or more Greek AIFs; and
• EU or non-EU AIFMs marketing one or more AIFs in Greece.

The Law also distinguishes between:

• Management and marketing of AIFs to professional investors;
• The type of AIFM (AIFMSA, EU AIFM or a non-EU AIFM); and 
• The type of AIF (EU AIF or a non-EU AIF) being unmanaged or marketed.

AIFMSAs are allowed to manage EU and non-EU AIFs under certain conditions. Marketing of EU AIFs in Greece by AIFMSAs is also allowed under certain conditions. Marketing in other EU States requires the prior notification of the competent supervisory authority of the relevant EU State by the HCMC. EU AIFMs duly authorised by the competent supervisory authority of their home State are allowed to manage AIFs established in Greece. Marketing of EU AIFs by EU AIFMs in Greece is allowed following receipt by the HCMC of the relevant notification from the competent supervisory authority of the home State.

On 15.04.2022 Directive (EU) 2019/1160 on cross-border marketing and distribution of collective investment was transposed into Greek law (via amendments to the Law). These amendments introduced uniform marketing rules for both UCITS and AIFs across the EU and clarifications on cross border marketing and notification procedures to ensure compliance with the EU- wide distribution framework.

Regarding marketing of units or shares of AIFs by AIFMs to retail investors, the Law (article 41) provides that this is permitted only to AIFMSAs or other AIFMs operating in Greece (via passporting) as long as the following conditions are fulfilled:

• the AIFMSAs or other AIFMs operating in Greece distribute units or shares of AIFs directly or via a credit institution, an investment firm or an investment intermediation firm;
• the AIF  has an operating license and is supervised by the HCMC or the competent authority of its home jurisdiction;
• the distribution of units or shares of the AIF to retail investors is permitted by the regulatory regime of its home jurisdiction, as well as by the constitutional documents or/and the AIF regulation;
• the retail investor undertakes to invest at least EUR 100,000 per fund; and
• the AIFMSAs or other AIFMs operating in Greece receives information from the potential investor in respect of his knowledge, experience and risk tolerance regarding the investment in the AIF, in order to assess whether the AIF is suitable for such an investor. If, on the basis of such information, it is considered that the AIF is not suitable for the particular investor, a warning in this respect must be provided to him. If the investor does not provide sufficient information, a warning must be provided to him that an assessment of whether the AIF is suitable for him cannot be made. The aforementioned warnings can be provided in a standardised form.

Non-EU AIFMs are not permitted under the Law (until the adoption of a relevant delegated act by the European Commission) to manage or market any AIFs (EU or non-EU) in Greece. Marketing of non-EU AIFs in Greece without a passport is currently (until the enactment of a relevant delegated act by the European Commission) allowed only to AIFMSAs under certain conditions. Marketing of non-EU AIFs in Greece with a passport will be allowed once the European Commission adopts the delegated Act referred to under Article 68(6) of AIFMD, and from the date disclosed therein. Also, Greece opted not to implement Article 42 of AIMFD which provides the conditions for non-EU AIFMs to make offerings to professional investors within an EU State without a passport via private placement.

The definition of the term “pre-marketing” is, according to article 4 of the Law “the provision of information or communication, direct or indirect, on investment strategies or investment ideas by an EU AIFM or on its behalf, to potential professional investors domiciled or with a registered office in the Union in order to test their interest in an AIF or a compartment which is not yet established, or which is established, but not yet notified for marketing in accordance with article 31 or 32, in that member state where the potential investors are domiciled or have their registered office, and which in each case does not amount to an offer or placement to the potential investor to invest in the units or shares of that AIF or that compartment". 

EU AIFMs can initiate pre-marketing as long as the information provided by them to professional investors:

• is not adequate for the latter to subscribe to the units or shares of an AIF;
• does not amount to subscription forms or similar documents (whether in draft or final form) and
• does not amount to constitutional documents, any prospectus or offering documents of a not-yet-established AIF in a final form.

Additionally, EU AIFMs should ensure that investors do not acquire units or shares in an AIF through pre-marketing and that investors contacted as part of pre-marketing can only acquire units or shares in that AIF through marketing permitted in accordance to articles 31 or 32 of the Law.

Any subscription by professional investors, within 18 months of the EU AIFM having begun pre-marketing, to units or shares of an AIF referred to in the information provided in the context of pre-marketing, or of an AIF established as a result of the pre-marketing, should be considered to be the result of marketing and should be subject to the applicable notification procedures referred to in articles 31 and 32 of the Law.

Within two weeks of having begun pre-marketing in Greece the AIFMSA (or other AIFM operating in Greece) must send an informal letter, in paper form or by electronic means, to the HCMC (or, in the case of other AIFM, the competent authorities of its home member state), specifying inter alia in which member states it is or has engaged in pre-marketing, the periods during which the pre-marketing is taking or has taken place and including, where relevant, a list of its AIFs and compartments of AIFs which are or were the subject of pre-marketing. 

The HCMC informs promptly the competent authorities of the home member state of the EU AIFM, in which the EU AIFM is or has engaged in pre-marketing thereof. The competent authorities of the member states where the pre-marketing took/takes place, may request by the HCMC to provide further information in relation to the pre-marketing taking place in its territory (the HCMC, can also make the same request to the competent authority of the home member state of the EU AIFM).

A third-party may engage in pre-marketing, on behalf of an AIFMSA or other authorized EU AIFM, only if:

In Greece, it is authorised as an investment societe anonyme (as per article 4 of law 4514/2018) or a credit institution (according to law 4261/2014) or a mutual fund management societe anonyme (as per article 3 of law 4099/2012) or an AIFMSA (according to the Law; or

In another EU member state, it is authorised as an enterprise for the provision of investment services (in accordance with Directive 2014/65/EU) or a credit institution (in accordance with Directive 2013/36/EU) or an UCITS management company (in accordance with Directive 2009/65/EC) or an AIFM (in accordance with Directive 2011/61/EU).

The aforementioned also apply to any third-party acting as a tied agent (as per para. 29 of article 4 of law 4514/2018 or in accordance with Directive 2014/65/EU).

• An AIFM planning to market an AIF in Greece must file a prior notification to the HCMC. The notification fees are EUR 1,000 per sub-fund/compartment or AIF.
• A Greek AIFM planning to market any AIFs abroad must file a prior notification to the HCMC. The notification fees are EUR 150 per country of intended marketing.
• AIFMs are also subject to semi-annual supervisory contributions to the HCMC based on the total assets under management of the AIFs they manage. These include a fixed fee of EUR 2,500 and a marginal percentage (0.0035 %–0.001 %) applied to assets exceeding EUR 100 million. Contributions are payable in July and January each year.
• AIFMs that provide additional investment services pay an annual contribution fee of EUR 1,000 and an incremental percentage of their turnover from such services per sub-fund/compartment or AIF to the HCMC. The fee is payable in July of each year.