We are delighted to announce that Langham Hall has won the “Best Fund Administrator – GPs < $30Bn” category at The Private Equity Wire European Awards 2024. This category recognises best in class administrators working with GPs managing less than $30bn AUM.

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Jon Young, Head of Guernsey said: “We are delighted to have been recognised with this award. Our partner-led, client centric approach makes us increasingly unique in this market, and we continue to support both emerging and established managers across Europe.”

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The awards recognise excellence among service providers and private equity fund managers in Europe across a wide range of categories. Voting for the awards was conducted via an online poll of the entire Private Equity Wire userbase, where participants were asked to make their choice among the shortlisted firms in each category.

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Thank you to all our clients for all their continued support.

Deciding what path to take after school can be a daunting decision, do you continue onto a Sixth Form, go to college, or consider an apprenticeship?

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Apprenticeships are an exciting option, where you get hands-on training while simultaneously putting the skills you learn into practice.

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As we celebrate National Apprenticeship Week 2024, we spoke with Rushk Naqui and Teri Sandford.

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Q: Why did you decide to do an apprenticeship?

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TS: When looking to begin my career I was unsure on what path would be best. However, after plenty of research I found an apprenticeship would be the best way for me to learn and grow. I quickly came to realise that Financial Crime was the industry/role that I was most interested in and keen to learn more about. As an apprentice you get a chance to develop all areas of your work whilst gaining a qualification that helps you in your day to day work.

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RN: From a practical perspective, an apprenticeship provided the platform to be able to support my family in a meaningful way in the immediate and near future. The apprenticeship model also created a structure and support system that surrounds me, which I was not guaranteed at university. I also found the prospect of being in an environment with world-class professionals inspirational and an opportunity to change my perspective.

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Q: What kind of tasks have you completed / do you complete on a daily basis?

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TS: On a daily basis I conduct Customer Due Diligence checks/ reports for the onboarding of all new internal clients and for counterparties on behalf of external clients.

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RN: My role is to help uphold and expand the firms risk management and compliance functions. Some of the tasks include; Assessing all criminal, regulatory or adverse media reports related to our clients as well as studying the risk and regulatory landscape.

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Q: What has been your biggest challenge during your apprenticeship so far?

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TS: Balancing apprenticeship work with your day-to-day work can be challenging at times. However, this can be made easier by developing a timetable/ schedule to split your day to day from your apprenticeship. I personally found this developed my time management skills and allowed me to split my time appropriately and effectively.

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RN: 14 months into my Financial Crime apprenticeship I was offered a 3-month secondment to the Regulatory Compliance team. Having to adapt to this new role while aiming to maintain the standards already set by the team was an enriching experience, my new tasks tested my capabilities and forced me to grow.

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Q: What do you hope to be doing in five years’ time?

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TS: I hope to have achieved my ICA Qualification and have progressed to a more senior level within the Financial Crime Team.

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RN: I hope to have more responsibility, be more knowledgeable and become someone my colleagues can turn to for expertise.

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Q: What’s the best piece of advice you could give to someone who’s looking for an apprenticeship?

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TS: My recommendation is to research as much as you can to find an apprenticeship best suited to you within an area that you are interested in and keen to develop for your career. Also, keep an open mind when listening to and searching for opportunities.

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RN: Take advantage of the support available. There are charities and organisations dedicated towards mentoring young people and assisting them at every stage of the apprenticeship process. I would not be in this position without the help I received from the wonderful people at these places.

Following a very challenging 2023, managers throughout the market are planning their fundraising strategy and timelines for 2024. Europe will be a key target for many. We are seeing a lot of interest already, including from managers who have never previously chosen to raise from Europe.

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To summarise, for any non-EU manager looking to raise capital from Europe, there are only two routes in which you can “market” a fund in line with the prevailing AIFMD regulation. These are a) marketing a non-EU fund (typically Delaware) or b) marketing an EU fund (typically Luxembourg). This has been the position for 10 years. However, ahead of selecting either route, managers should strongly consider implementing a formal “pre-marketing” phase ahead of marketing. Since August 2021, pre-marketing in the EU now requires notification to regulators of the relevant country.  By leveraging Langham Hall’s approval as a regulated AIFM in the EU, we can register for a  pre-marketing campaign covering all EU countries. This is not possible for non-EU fund managers.

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Hosted Pre-marketing is the fastest way to start speaking to investors. The chronology is as follows:

1. Undertake pre-marketing;
2. Undertake formal marketing by either:*
   a. Marketing a non-EU fund via the National Private Placement Regimes (‘NPPR’) where accessible in that country; or
   b. Marketing an EU domiciled fund via the EU marketing passport

_{*For structural reasons some managers may decide to use both options to maximise routes for bringing in European capital.}

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Hosted pre-marketing

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This approach is being used as a pathfinder to European LPs. It facilitates conversation with LPs throughout Europe allowing discussion and document sharing (drafts only), up to but short of, executable subscription documents. This can also be conducted for a “potential” EU fund i.e. before establishment, as part of a global fundraise. In this scenario, pre-marketing is conducted for a potential Lux fund as part of the decision making process to determine what level of EU LP interest exists. Once pre-marketing has been completed and LP interest quantified, the fund sponsor/manager can then elect the more appropriate route of the two set out above to circulate final fund documents and admit investors.

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Hosted pre-marketing can be up and running in 2-4 weeks.

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1. Marketing a non-EU fund via the National Private Placement Regime (NPPR)

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Marketing via NPPR is still the preferred route to admit investors from the EU for the majority of non-EU managers. It has been used successfully for 10 years, though some managers are yet to explore this option. It allows targeted country by country marketing, and is the required regulatory step to bring European investors into a non-EU fund. Certain regulatory requirements are triggered by formal marketing, including annex IV reporting (similar to Form PF) and a depositary-lite service (triggered by investors in Germany and Denmark). We provide these services from our London office.

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Timelines vary, but managers should factor in 1-3 months to identify jurisdictions and get marketing permissions in place. Because of this, careful sequencing of pre-marketing and marketing applications should be considered so not to delay investor commitments.

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2. Marketing an EU fund using a marketing passport

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This requires establishing a (typically) Lux parallel fund usually managed by a Lux host-AIFM, with Lux fund administration and depositary services. It is a viable option for anyone raising more than $300m from European investors. While introducing some operational complexity, this is the natural progression for those with sufficiently strong LP demand or strategic needs and opens the fund for (professional) investors throughout any EU country.

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The timeline to establish a Lux fund and getting a formal marketing approval to circulate final Lux fund documents and accept investors is usually circa 2.5 months.

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A note on reverse solicitation

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Managers considering European fundraising should bear the following in mind. In an increasingly competitive fundraising environment, reverse solicitation is less predominant than it once was. Reverse solicitation does not constitute a marketing strategy, and is undertaken at the sole risk of the GP and manager if it should be proven later that it was not a genuine reverse solicitation from the investor. EU regulators are putting more scrutiny on reliance on reverse solicitation and IR teams and placement agents are at risk of being in breach of EU regulations for pre-marketing or marketing a fund without regulatory approvals/notifications. GCs and CCOs are wary of investor DDQs increasingly asking about exposure to reverse solicitated investors. Case law now exists in which a distributor has been prosecuted for marketing activities relying on reverse solicitation.

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If you are considering any European fundraising at all, please contact either Hanny Tirta (hanny.tirta@langhamhall.com) or Joe Hime (joe.hime@langhamhall.com) and we can walk you through the details of premarketing, NPPR and establishing and operating a Lux fund.

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For all US fund administration requirements, please contact Joseph Hindi (joseph.hindi@langhamhall.com) our Head of US, based in New York.

Effective 31 January 2024, the Financial Conduct Authority (‘FCA’) Handbook’s thresholds on high net worth individuals (‘HNWIs’) and ‘sophisticated investors’ has changed. These changes are a result of the FCA consultation response on financial promotion order (‘FPO’) exemptions for HNWIs, which was published in November last year. These exemptions have not been substantively updated since 2005.

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The new thresholds for each of the criteria are;

• High Net Worth Individuals: The net annual income requirement will increase from £100,000 to £170,000. Additionally, the threshold for net assets will rise from £250,000 to £430,000 or more.
• Self-Certified Sophisticated Investors: There will no longer be a requirement for individuals to have made more than one investment in an unlisted company in the prior two years. The exemption for company directors will change, requiring the company’s minimum annual turnover to be £1.6 million or greater, from a previous minimum of £1 million.

The exemption for individuals that have been part of a network of business angels, and/or have worked in the private equity or SME finance sector for two years remains unchanged.

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If a person relies on the above categories for financial promotion of a non-retail fund, there may also be further regulatory considerations (e.g. the production of a Key Information Document (‘KID’), risk warnings, 24 hour cool off periods, etc) subject to appropriate legal advice as investors in these categories are still a sub-set of retail investors. Alternatively, these investors may very well elect to opt-up to professional status if they meet the MiFID criteria for professional investors for the most straight forward financial promotion.

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For fund sponsors that are not regulated to distribute products to “retail” investors, it is important to note these new thresholds especially where they are relying on the relevant FPO exemptions in relation to these investor classes. It is important to note that these thresholds will also be applicable in the context of “friends and family” raises. Appointed Representatives undertaking financial promotions will also be required to consider these new definitions, in case they don’t have permissions to market to pure retail clients.

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Blog updated 18/03 – These amendments were met with harsh criticism by many in the venture capital and start-up community and on the 6 March the UK Government reversed its decision. Read more here.

As you approach the end of your university degree and you start considering what career path would be suited to your interests and skills, there is a wide selection of opportunities to look into following graduation. One of these options is joining a Graduate Programme.

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We have spoken with two of our 2023 Graduate Trainees, Melissa Hilling and Oscar Pringle, who shared their experience of their application process and what advice they would share to anyone considering staring a career in the funds world.

Melissa and Oscar joined Langham Hall in September 2023.

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Why did you decide to join the Graduate Programme at Langham Hall?

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MH: I have always been interested in analysing how businesses and investment funds are impacted by economic change, especially in the real estate sector. This paired with my interest in accounting is what drew me to pursue a career in fund accounting. When I was applying for graduate programme, it was important to me to work somewhere which would support my professional development, especially as I did not have a finance-based degree, having studied English at University. Langham Hall’s extensive focus on learning and development whilst also having a hands-on approach with practical exposure is what really stood out to me.

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OP: I wanted to work in private markets and Langham Hall’s graduate programme offered me the chance to explore this interest. The graduate programme sets you up well for a successful career in the fund industry, allowing you to gain an in-depth understanding of fund operations, whilst acquiring practical skills and knowledge through sitting the ACCA exams. This is a valuable qualification and all being well you become a chartered accountant after three years, with a wealth of knowledge in the fund industry. For me, this was a very attractive offering, and it has definitely proved its case so far!

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Q: How did you find the Assessment Centre Day and application process?

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MH: The application process was straight forward and really painted a picture of what life at Langham Hall was like. The interviews were in person at the office which I really liked. There was no need to know the ins and outs of what fund accounting entailed. It was also a chance to find out more about Langham Hall and the type of clients they work with.

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OP: While studying for an economics degree at the University of St Andrews, I applied for the graduate programme and within two months of submitting my application, I had been offered a full-time position to take up on graduation. I was very impressed by the speed and efficiency of the whole application process. Having completed tests and online interviews, I attended the final stage of the application process, the Assessment Centre Day. This was an insightful day whereby I was able to meet some of my future colleagues and visit the London office.

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Q: What’s the best piece of advice you could give to someone who’s considering applying for the 2024 Programme? Any tips?

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MH: Show that you are eager and willing to learn! Try to gain an understanding of what Langham Hall does before the interviews. Do some research on the firm and fund accounting so that you can speak about it at a high level. It’s also important to have some commercial awareness and be able to give some real-life examples. I found the Insights section on the Langham Hall website really useful!

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OP: Really research what Langham Hall does and highlight points of interest. If it ticks the boxes for you, then just go for it! If you make it to the interview stages, ask lots of open-ended questions and be engaging.

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Q: What do you hope to be doing in three years’ time?

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MH: A qualified fund accountant managing a team of my own!

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OP: I hope to have completed my exams and be a fully qualified fund accountant! I want to take on more responsibility within the private equity team, becoming that focal point for my clients, with a view to leading a team of my own in the future.

Our trainee programmes are aimed at kickstarting your career in the funds sector, covering illiquid asset classes such as private equity and real estate, developing your skills and knowledge to allow you to make an impact in our business and industry.

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If you are interested in joining Langham Hall, check out our latest vacancies here.

This is a reminder that AIFMD Annex IV submissions for the period ending 31 December 2023 are due to be filed by 31 January 2024. The requirement to report is in place for:

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All EU AIFMs, UK AIFMs and non-EU AIFMs which:

1. Have active funds with commitments from EU/UK LPs marketed to under AIFMD; and
2. Have AIFs currently being marketed under AIFMD in the EU / UK.

We have seen a marked year on year increase in GPs seeking European capital, and expect this to be the busiest filing period of the last decade. With many GPs planning to return to fundraising in 2024, we have also seen a large number of managers seeking to tidy-up any outstanding historic submissions, which may have been missed in the past.

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There is no harmonised system for completing and filing these reports across the EU, rather each regulator has its own reporting portal with various nuances in reporting format and process. This reporting burden often falls to fund finance or compliance teams who may be unfamiliar with the reporting process, which will be required for all AIFs by 31st January 2024, and potentially as often as quarterly thereafter depending on the requirements.

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Langham Hall has been completing Annex IV reporting for AIFMs and AIFs since 2014. We prepare and file hundreds of Annex IV reports each year and are familiar with the reporting portals across all jurisdictions. Langham Hall is able to set up the portal access for each country, and complete and file these Annex IV reports in the relevant formats required by each regulator. We file these reports directly with the regulator with minimal involvement required from the fund manager.

Farview Equity Partners (‘Farview’), the Europe focused growth investor, continues to deploy capital and now has four deal structures in a range of financial and ESG focused businesses. This includes investments in Evora Global, Unily, Exclaimer and Amplience.

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Langham Hall has been appointed to provide administration and accounting services to the deal structures from our Guernsey office, which assisted Farview in transitioning structures from another administrator in 2022.

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Guy Sochovsky, founder and partner at Farview said ”Langham Hall has been a valuable partner to us as we continue to execute our investment strategy in Europe. Their communication, responsiveness and ability to problem solve is second to none.”

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We look forward to working with Farview as they continue to execute this strategy.

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About Farview Equity Partners

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Farview Equity Partners invests in growth-oriented enterprise and financial technology companies in Europe. Founded in 2019 by a team of highly experienced professionals with sector-specific growth equity, operational and legal backgrounds, our mission is to empower European enterprise and financial technology companies to grow beyond their current horizons.

The Economic Crime and Corporate Transparency Bill 2022 was passed into law on 26 October 2023 and became The Economic Crime and Corporate Transparency Act 2023(the “Act”).

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The Act is designed (amongst other things) to tackle money laundering and strengthen the UKs company registrar, known as Companies House. It will reform the role of Companies House radically, turning it into an active gatekeeper.

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As anticipated, as part of these changes the Act introduces an identity verification requirement for:

• all new and existing company directors,
• People with Significant Control (PSC), and
• those delivering documents to Companies House UK.

Filing requirements for limited partnerships and limited liability partnerships have also been reformed under the Act, with part of that reform being that partners will also require verification at Companies House.

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To help facilitate verification, the Act introduces the new role of the Authorised Corporate Service Provider (‘ACSP’).

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There will be a transition period for existing directors and their equivalents, and for PSCs to verify their identity in. This transition period will provide existing directors and PSCs time to comply with the new requirements, whilst ensuring the integrity of data already on the register. Detailed guidance should be issued shortly.

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How can Langham Hall help?

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Building on our success as one of the top ten verification agents in the country for the Register of Overseas Entities, Langham Hall will be acting as an ACSP and will be able to assist clients with fulfilling these new verification requirements.

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If you wish to discuss the requirements and how Langham Hall can assist you please do not hesitate to get in contact: LHACSPServices@langhamhall.com

The Economic Crime and Corporate Transparency Bill 2022 (‘the Bill’) is upcoming legislation designed to tackle money laundering and strengthen the UKs company registrar, known as Companies House. This is a follow on from the Economic Crime Transparency and Enforcement Act 2022, which saw the implementation of the Register of Overseas Entities for those entities holding UK land or property.

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The Bill is expected to introduce an identity verification requirement for:

• all new and existing company directors,
• People with Significant Control, and
• those delivering documents to Companies House UK.

Filing requirements for limited partnerships and limited liability partnerships will also be reformed under the Bill, with part of that reform being that partners will also require verification at Companies House.

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To help facilitate verification, the Bill will introduce the new role of the Authorised Corporate Service Provider (‘ACSP’).

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Building on our success as one of the top ten verification agents in the country for the Register of Overseas Entities,

Langham Hall intends to become an ACSP and will be able to assist clients with fulfilling these new verification requirement.

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The Bill is expected to receive Royal Assent within the next month and detailed guidance should be issued shortly after that.

If you wish to discuss the requirements and how Langham Hall can assist you please do not hesitate to get in contact: LHACSPServices@langhamhall.com

ACSP after Royal Assent: What you need to know