It has been difficult not to notice that there is renewed disquiet about AIFMD. As the Level 2 process progresses, so the situation appears to be getting worse.

In developing its guidance to the European Commission, ESMA undertook a pretty thorough consultation exercise, including the production of two consultation papers and holding two public hearings. Sadly, that did not make it a perfect exercise because, regrettably, time and resources did not allow ESMA to reflect fully in their final guidance the wide range of issues raised by the industry. Nevertheless, it moved in the right direction.

Amid protestations from the Commission that they are sticking closely to the ESMA guidance, will not succumb to bullying by the industry and much other spluttering, we now see serious suggestions that they intend to make adjustments to significant elements of the ESMA guidance. The potential consequence of that is that the Commission persuades the European Securities Committee that it is right and the whole of the financial services industry across the EU is hit with its regulations, which in many cases have the combined characteristics of being both expensive and without benefit.

However, the text in question, although widely circulated, has not been published as yet and is subject to challenge and modification. Meanwhile, it is true to say that, however significant the Commission’s changes might be, they have accepted over 90% of ESMA recommendations, so the picture, despite missing a few important pieces, is already pretty clear. There is now a firm basis on which to plan and firms that have not yet looked in detail at the impact of the directive on their activities should be drawing up an impact analysis. AIFMD will affect all non-UCITS investment funds for which any activity, whether management, marketing or administration, is carried out in the EU.