On March 15th, 2022 the Ministry of Economy and Finance issued the Ministerial Decree No. 19/2022 (the “DM 19/22”) concerning the “regulation amending Decree No. 30 of 5 March 2015 (the “DM 30/2015”), implementing Art. 39 of Legislative Decree No. 58/98, concerning the determination of the general criteria to be complied with by the UCIs”; such decree has entered into force on March 30th, 2022.
Broadly speaking, the DM 19/22, in making some amendments to the previous DM 30/2015, introduced significant amendments regarding the conditions of access of non-professional investors to reserved AIFs, recognizing to this category of investors, the right to subscribe units or shares of a reserved AIF even for amounts lower than the 500k euros so far provided as a minimum, non-fractionable, threshold of participation in the AIF. This threshold has been reduced to 100k euros in the presence of certain safeguards provided for in the amended Art. 14, para. 2 of DM 30/2015.
In particular, the rule now provides for the feasibility that the following will also participate in the reserved AIF:
- non-professional investors who, as part of the provision of the investment advisory service performed according to the MiFID regulation, subscribe to or purchase units or shares of the reserved AIF for an initial amount of not less than 100k euros provided that, as a result of such subscription or purchase, the total amount of investments in reserved AIFs does not exceed 10 per cent of their financial portfolio. The initial minimum participation is not fractionable;
- MiFID firms that provide the portfolio management service who, as part of the performance of such service, subscribe to or purchase units or shares of the reserved AIF for an initial amount of not less than 100k euros on behalf of non-professional investors.
A new para. 2-bis has also been introduced in the above-mentioned Art. 14, which gives the investor the burden of providing the financial advisor with “accurate information on his financial portfolio and investments in AIFs” so that such financial advisor, as part of the provision of the advisory service, can assess the existence of the requirement of the maximum concentration limit (10%) of the financial portfolio in reserved AIFs[1].
In order for the provisions of the new regulatory provisions to be implemented, it is understood that the preliminary condition, provided by DM 30/2015, is that the regulation of the AIF, if this is formed in contractual form, or the articles of association if the AIF is incorporated in corporate form, expressly admits the access of non-professional investors to a product that, by it is therefore of paramount importance that the constituent documents of the AIF contain provisions aimed at allowing the participation in the AIF of subjects other than professional investors to whom the reserved AIF is intended, by definition.
The aim of the regulatory amendment, long overdue and solicited, is significant because it allows to expand the audience of subscribers in alternative funds, including subjects who, although not professional, have a certain saving capacity and who, thanks to it, can support the real economy by making investments that represent an opportunity both for the investors and for the economic system as a whole.
Although it has reserved AIFs under Italian law, Art. 14 of DM 30/2015, as already in the previous formulation, is also fully applicable to reserved EU AIFs that, as is well known, can access the Italian market by way of the European passport recognized to the manager of the AIF (i.er. AIFM) authorized pursuant to the AIFMD (Directive 2011/61/EU).
It is understood that the AIFM that performs the notification procedure for the marketing in Italy of the units or shares of the foreign reserved AIF, where it intends to offer the AIF not only to professional investors, according to the regime provided by the AIFMD, but also to the categories of non-professional investors identified by Art. 14 of DM 30/2015, must specify it in the letter of notification committing to carry out the marketing activity in the territory in compliance with the safeguards imposed by such rule.
Once the notification notice – which, pursuant to Art. 32 of the AIFMD, must be submitted by the EU AIFM to its Supervisory Authority, for subsequent forwarding to the corresponding Italian Authority (i.e. CONSOB) – has made explicit the intention of the AIFM to market the AIF to the categories of non-professional investors identified by Art 14 itself.
Therefore, the reserved AIF, even abroad, appropriately registered in Italy, can be signed not only by professional investors, but also by: - non professional investors who make an initial minimum investment, non-fractionable, not less than 500k euros, in the case of direct investment;
- non professional investors willing to initially invest no less than 100k euros, non fractionable, with a concentration limit of 10% of their financial portfolio (as defined above), provided that they make the investment as part of the investment advisory service;
- portfolio managers that subscribe to or purchase units or shares of the AIF as part of the provision of the portfolio management service, on behalf of non-professional investors, for an initial amount not less than 100k euros.
It is recalled that, once the notification has been completed, so that the AIF can be advised or distributed to non-professional investors in Italy, the EU AIFM will be required to produce and deposit with CONSOB, as well as with the Supervisory Authority of its country of origin, the document containing the key information (so-called KID). The KID must be drawn up in accordance with the criteria dictated by Regulation (EU) no. 1286/2014 and translated into Italian, so that it can be used on the domestic market; moreover, it must contain in a special section, entitled “What is this product” a description of the type of retail investor to whom the AIF intends to be marketed in Italy.
Finally, in carrying out the AIF’s offer to non-professional investors in Italy, account must also be taken of the provisions of the Issuers’ Regulation, being issued, relating to the AIFM’s duty to adopt local facilities aimed at facilitating this category of investors, inter alia, in the execution of subscription, payment and redemption of the units or shares of the AIF. The CONSOB document contains, indeed, some newly formulate rules regarding the need to include, in the notification dossier for the marketing of the AIF to the categories of non-professional investors identified by art. 14 of DM 30/2015, also information on the structures that the foreign reserved AIF will have to adopt for the offer of its units or shares, in accordance with Art. 43-bis of the AIFMD.
The consultation on the draft Issuers’ Regulation made available by CONSOB on its website on 11 February ended on 11 March, so that the new regulations are expected to be issued shortly, which will transpose, with regard to CONSOB’s areas of competence, European legislation of the cross-border distribution of funds not merged into primary legislation (TUF).
[1] The DM 19/22 also provides a definition of “financial portfolio”, introducing letter aa.) to Art. 1, para. 1 of DM 30/2015, in the following terms: “the total value of the portfolio consisting of bank deposits, insurance investment products and financial instruments also available from other intermediaries or managers. |
