Having now submitted Annex IV reporting for multiple fund managers across multiple jurisdictions we thought it was worth highlighting a few issues to consider next quarter for those in house considering submitting to a small handful of jurisdictions, writes Joe Hime, Langham Hall’s Head of Depositary.
Under the national private placement regime (NPPR), fund managers are required to submit “transparency reports” in all EU jurisdictions in which they have permissions to market a fund. Referred to interchangeably as transparency reports, Annex IV reports or AIFMD reports, the reporting framework is similar in nature to Form PF in the US and require separate reports for the fund manager and each fund being marketed.
The frequency of reporting is defined by ESMA guidelines which stipulate annual, semi-annual or quarterly reporting. This varies according to two factors: the total AUM of the funds marketed per jurisdiction and whether or not those funds are leveraged.
The reporting deadline for the period ending 31 December 2015 was at the end of January and highlighted a number of practical issues which, beyond the technical content of reports, managers need to be aware of, in particular when preparing to submit their first reports. Here are our top 6 observations based on practical experience:
- Each jurisdiction has its own method for receiving the reports. Most have an online portal, such as the FCA’s Gabriel system, which allows either manual data input or the uploading of files encoded in the appropriate XML format. Other jurisdictions require reports to be emailed directly to the regulator.
- In some jurisdictions gaining access to reporting portals is an additional step after receiving permission to market and if not already in place will need to be addressed well in advance of reporting deadlines.
- A number of issues have been reported concerning portals crashing or becoming unresponsive during peak times. This can result in a loss of data already inputted.
- Whilst regulators provide support via email and in some instances telephone, restricted hours of operation and time differences can mean that accessing support is not always straightforward.
- Upon initial submission the reports are error checked by the regulators. This is an automated process which takes normally only a few minutes but can take up to a day or more to provide a result. Final submission can only occur once all errors have been resolved.
- This two stage submission process means that reports can be uploaded without being “submitted” and could result in a late filing.
The FCA's Gabriel system: 'allows manual data input or file uploads'
- The next quarterly filings are due in April and Langham Hall has the practical knowledge and technical experience to prepare and file AIFMD reports across the EU. For further information please contact Marie Fitzpatrick, Business Development Director, email@example.com, +44 (0)20 3597 7909 or Joe Hime, Head of Depositary, firstname.lastname@example.org, +44 (0)20 3597 7969.
- Langham Hall is regulated by the FCA to provide depositary and depositary-lite services. We specialise in servicing real estate, private equity, debt and infrastructure funds.
- Our team of accountants and alternatives specialists have been filing annex IV reports for managers based in the UK, US and Asia since the requirement first existed. We currently prepare and submit reports for managers marketing in eight EU jurisdictions. We can also assist in securing the reporting permissions from the regulators to their portals.