S.I. No. 257/2013 - European Union (Alternative Investment Fund Managers) Regulations 2013

• (b) Where the cash accounts are opened in the name of the depositary acting on behalf of the AIF, no cash of the entity referred to in subparagraph (a) and none of the depositary’s own cash shall be booked on such accounts.

• (8) The assets of the AIF or the AIFM acting on behalf of the AIF shall be entrusted to the depositary for safe-keeping, as follows:

• (a) for financial instruments that can be held in custody:

• (i) the depositary shall hold in custody all financial instruments that can be registered in a financial instruments account opened in the depositary’s books and all financial instruments that can be physically delivered to the depositary,

• (ii) for that purpose, the depositary shall ensure that all those financial instruments that can be registered in a financial instruments account opened in the depositary’s books are registered in the depositary’s books within segregated accounts in accordance with the principles set out in Article 16 of Directive2006/73/EC, opened in the name of the AIF or the AIFM acting on behalf of the AIF, so that they can be clearly identified as belonging to the AIF in accordance with the applicable law at all times;

• (b) for other assets:

• (i) the depositary shall verify the ownership of the AIF or the AIFM acting on behalf of the AIF of such assets and shall maintain a record of those assets for which it is satisfied that the AIF or the AIFM acting on behalf of the AIF holds the ownership of such assets,

• (ii) the assessment whether the AIF or the AIFM acting on behalf of the AIF holds the ownership shall be based on information or documents provided by the AIF or the AIFM and, where available, on external evidence,

• (iii) the depositary shall keep its record up-to-date.

• (9) In addition to the tasks referred to in paragraphs (7) and (8), the depositary shall:

• (a) ensure that the sale, issue, re-purchase, redemption and cancellation of units or shares of the AIF are carried out in accordance with the applicable national law and the AIF rules or instruments of incorporation;

• (b) ensure that the value of the units or shares of the AIF is calculated in accordance with the applicable national law, the AIF rules or instruments of incorporation and the procedures specified in Regulation 20;

• (c) carry out the instructions of the AIFM, unless they conflict with the applicable national law or the AIF rules or instruments of incorporation;

• (d) ensure that in transactions involving the AIF’s assets any consideration is remitted to the AIF within the usual time limits;

• (e) ensure that an AIF’s income is applied in accordance with the applicable national law and the AIF rules or instruments of incorporation.

(10)(a) In the context of their respective roles, the AIFM and the depositary shall each act honestly, fairly, professionally, independently and in the interest of the AIF and the investors of theAIF.

• (b) A depositary shall not carry out activities with regard to the AIF or the AIFM on behalf of the AIF that may create conflicts of interest between the AIF, the investors in the AIF, the AIFM and itself, unless the depositary has functionally and hierarchically separated the performance of its depositary tasks from its other potentially conflicting tasks, and the potential conflicts of interest are properly identified, managed, monitored and disclosed to the investors of the AIF.

• (c) The assets referred to in paragraph (8) shall not be reused by the depositary without the prior consent of the AIF or the AIFM acting on behalf of the AIF.

(11)(a) The depositary shall not delegate to third parties its functions as described in this Regulation, other than those referred to in paragraph (8).

• (b) The depositary may delegate to third parties the functions referred to in paragraph (8) subject to the following conditions:

• (i) the tasks are not delegated with the intention of avoiding the requirements of these Regulations;

• (ii) the depositary can demonstrate to the Bank, if the Bank so requires, that there is an objective reason for the delegation;

• (iii) the depositary has exercised all due skill, care and diligence in the selection and the appointment of any third party to whom it wishes to delegate parts of its tasks, and keeps exercising all due skill, care and diligence in the periodic review and ongoing monitoring of any third party to whom it has delegated parts of its tasks and of the arrangements of the third party in respect of the matters delegated to it; and

• (iv) it ensures that the third party meets the following conditions at all times during the performance of the tasks delegated to it:

• (I) the third party has the structures and the expertise that are adequate and proportionate to the nature and complexity of the assets of the AIF or the AIFM acting on behalf of the AIF which have been entrusted to it;

• (II) for custody tasks referred to in paragraph (8)(a), the third party is subject to effective prudential regulation, including minimum capital requirements, and supervision in the jurisdiction concerned and the third party is subject to an external periodic audit to ensure that the financial instruments are in its possession;

• (III) the third party segregates the assets of the depositary’s clients from its own assets and from the assets of the depositary in such a way that they can at any time be clearly identified as belonging to clients of a particular depositary;

• (IV) the third party does not make use of the assets without the prior consent of the AIF or the AIFM acting on behalf of the AIF and prior notification to the depositary; and

• (V) the third party complies with the general obligations and prohibitions set out in paragraphs (8) and (10).

• (c) Notwithstanding subclause (II) of subparagraph (b)(iv), where the law of a third country requires that certain financial instruments be held in custody by a local entity and no local entities satisfy the requirements specified in that subclause, the depositary may delegate its functions to such a local entity only to the extent required by the law of the third country and only for as long as there are no local entities that satisfy those requirements, subject to the following being satisfied:

• (i) the investors of the relevant AIF shall be duly informed that such delegation is required due to legal constraints in the law of the third country and of the circumstances justifying the delegation, prior to their investment; and

• (ii) the AIF, or the AIFM on behalf of the AIF, shall instruct the depositary to delegate the custody of such financial instruments to such local entity.

• (d) The third party may, in turn, sub-delegate those functions, subject to the same requirements. In such a case, paragraph (13) shall apply with the necessary modifications to the relevant parties.

• (e) For the purposes of this paragraph, the provision of services as specified by Directive 98/26/EC by securities settlement systems as designated for the purposes of that Directive or the provision of similar services by third-country securities settlement systems shall not be considered a delegation of its custody functions.

(12)(a) The depositary shall be liable to the AIF or to the investors of the AIF, for the loss by the depositary or a third party to whom the custody of financial instruments held in custody in accordance with paragraph (8)(a) has been delegated.

• (b) In the case of such a loss of a financial instrument held in custody, the depositary shall return a financial instrument of identical type or the corresponding amount to the AIF or the AIFM acting on behalf of the AIF without undue delay. The depositary shall not be liable if it can prove that the loss has arisen as a result of an external event beyond its reasonable control, the consequences of which would have been unavoidable despite all reasonable efforts to the contrary.

• (c) The depositary shall also be liable to the AIF, or to the investors of the AIF, for all other losses suffered by them as a result of the depositary’s negligent or intentional failure to properly fulfil its obligations pursuant to these Regulations.

(13)(a) The depositary’s liability shall not be affected by any delegation referred to in paragraph (11).

• (b) Notwithstanding subparagraph (a), in case of a loss of financial instruments held in custody by a third party pursuant to paragraph (11), the depositary may discharge itself of liability if it can provethat:

• (i) all requirements for the delegation of its custody tasks set out in subparagraph (b) of paragraph (11) are met;

• (ii) a written contract between the depositary and the third party expressly transfers the liability of the depositary to that third party and makes it possible for the AIF or the AIFM acting on behalf of the AIF to make a claim against the third party in respect of the loss of financial instruments or for the depositary to make such a claim on their behalf; and

• (iii) a written contract between the depositary and the AIF or the AIFM acting on behalf of the AIF, expressly allows a discharge of the depositary’s liability and establishes the objective reason to contract such a discharge.

• (14) Further, where the law of a third country requires that certain financial instruments are held in custody by a local entity and there are no local entities that satisfy the requirements specified in subclause (II) of paragraph (11)(b)(iv), the depositary can discharge itself of liability provided that the following conditions are met:

• (a) the rules or instruments of incorporation of the AIF concerned expressly allow for such a discharge under the conditions set out in this paragraph;

• (b) the investors of the relevant AIF have been duly informed of that discharge and of the circumstances justifying the discharge prior to their investment;

• (c) the AIF or the AIFM on behalf of the AIF instructed the depositary to delegate the custody of such financial instruments to a local entity;

• (d) there is a written contract between the depositary and the AIF or the AIFM acting on behalf of the AIF, which expressly allows such a discharge; and

• (e) there is a written contract between the depositary and the third party that expressly transfers the liability of the depositary to that local entity and makes it possible for the AIF or the AIFM acting on behalf of the AIF to make a claim against that local entity in respect of the loss of financial instruments or for the depositary to make such a claim on their behalf.

• (15) Liability to the investors of the AIF may be invoked directly or indirectly through the AIFM, depending on the legal nature of the relationship between the depositary, the AIFM and the investors.

(16)(a) In the case of an Irish AIF, the depositary shall make available to the Bank, on request, all information which it has obtained while performing its duties and that may be necessary for the Bank or the competent authorities of the AIFM. If the Bank and the competent authorities of the AIFM are different, the Bank shall share the information received without delay with the competent authorities of the AIFM.

• (b) In the case of a non-EU AIF which has appointed a depositary established in the State, the depositary shall make available to the Bank, on request, all information which it has obtained while performing its duties and that may be necessary for the competent authorities of the AIF or the Bank. The Bank shall share the information received without delay with the competent authorities of the AIF and the competent authorities of the AIFM, if not the Bank.

Chapter 5 Transparency Requirements

Annual report.

• (b) Where the AIF is required to make public an annual financial report in accordance with Directive 2004/109/EC only such additional information referred to in paragraph (2) shall be provided to investors on request, either separately or as an additional part of the annual financial report. In the latter case the annual financial report shall be made public no later than 4 months following the end of the financial year.

• (2) The annual report shall at least contain the following:

• (a) a balance-sheet or a statement of assets and liabilities;

• (b) an income and expenditure account for the financial year;

• (c) a report on the activities of the financial year;

• (d) any material changes in the information listed in Regulation 24 during the financial year covered by the report;

• (e) the total amount of remuneration for the financial year, split into fixed and variable remuneration, paid by the AIFM to its staff, and number of beneficiaries, and, where relevant, carried interest paid by the AIF;

• (f) the aggregate amount of remuneration broken down by senior management and members of staff of the AIFM whose actions have a material impact on the risk profile of the AIF.

• (3) The accounting information given in the annual report shall be prepared in accordance with the accounting standards of the home Member State of the AIF or in accordance with the accounting standards of the third country where the AIF is established and with the accounting rules laid down in the AIF rules or instruments of incorporation.

• (4) The accounting information given in the annual report shall be audited by one or more persons empowered by law to audit accounts in accordance with Directive 2006/43/EC of the EuropeanParliament and of the Council of 17 May 2006 on statutory audits of annual accounts and consolidated accounts⁴ . The auditor’s report, including any qualifications, shall be reproduced in full in the annual report.

• (5) By way of derogation from paragraph (4), the Bank may permit an AIFM marketing a non-EU AIF to subject the annual reports of that AIF to an audit that meets international auditing standards in force in the country where the AIF has its registered office.

Disclosure to investors.

• (a) a description of the investment strategy and objectives of the AIF, information on where any master AIF is established and where the underlying funds are established if the AIF is a fund of funds, a description of the types of assets in which the AIF may invest, the techniques it may employ and all associated risks, any applicable investment restrictions, the circumstances in which the AIF may use leverage, the types and sources of leverage permitted and the associated risks, any restrictions on the use of leverage and any collateral and asset reuse arrangements, and the maximum level of leverage which the AIFM is entitled to employ on behalf of the AIF;

• (b) a description of the procedures by which the AIF may change its investment strategy or investment policy, or both;

• (c) a description of the main legal implications of the contractual relationship entered into for the purpose of investment, including information on jurisdiction, on the applicable law and on the existence or not of any legal instruments providing for the recognition and enforcement of judgments in the territory where the AIF isestablished;

• (d) the identity of the AIFM, the AIF’s depositary, auditor and any other service providers and a description of their duties and the investors’ rights;

• (e) a description of how the AIFM is complying with the requirements of Regulation 10(7);

• (f) a description of any delegated management function as referred to in Schedule 1 by the AIFM and of any safe-keeping function delegated by the depositary, the identification of the delegate and any conflicts of interest that may arise from suchdelegations;

• (g) a description of the AIF’s valuation procedure and of the pricing methodology for valuing assets, including the methods used in valuing hard-to-value assets in accordance with Regulation 20;

• (h) a description of the AIF’s liquidity risk management, including the redemption rights both in normal and in exceptional circumstances, and the existing redemption arrangements with investors;

• (i) a description of all fees, charges and expenses and of the maximum amounts thereof which are directly or indirectly borne by investors;

• (j) a description of how the AIFM ensures a fair treatment of investors and, whenever an investor obtains preferential treatment or the right to obtain preferential treatment, a description of that preferential treatment, the type of investors who obtain such preferential treatment and, where relevant, their legal or economic links with the AIF or AIFM;

• (k) the latest annual report referred to in Regulation 23;

• (l) the procedure and conditions for the issue and sale of units or shares;

• (m) the latest net asset value of the AIF or the latest market price of the unit or share of the AIF, in accordance with Regulation 20;

• (n) where available, the historical performance of the AIF;

• (o) the identity of the prime broker and a description of any material arrangements of the AIF with its prime brokers and the way the conflicts of interest in relation thereto are managed and the provision in the contract with the depositary on the possibility of transfer and reuse of AIF assets, and information about any transfer of liability to the prime broker that may exist;

• (p) a description of how and when the information required under paragraphs (4) and (5) will be disclosed.

• (2) The AIFM shall inform persons before they invest in the AIF of any arrangement made by the depositary to contractually discharge itself of liability in accordance with Regulation 22(13). The AIFM shall also inform investors of any changes with respect to depositary liability without delay.

• (3) Where the AIF is required by law to publish a prospectus, only such information referred to in paragraphs (1) and (2) which is in addition to that contained in the prospectus shall be disclosed separately or as additional information in the prospectus.

• (4) An AIFM shall, for each EU AIF that it manages and for each AIF that it markets in the European Union, periodically disclose to investors:

• (a) the percentage of the AIF’s assets which are subject to special arrangements arising from their illiquid nature;

• (b) any new arrangements for managing the liquidity of the AIF;

• (c) the current risk profile of the AIF and the risk management systems employed by the AIFM to manage those risks.

• (5) An AIFM that manages an EU AIF employing leverage or that markets in the European Union an AIF employing leverage shall, for each such AIF, disclose on a regular basis:

• (a) any changes to the maximum level of leverage which the AIFM may employ on behalf of the AIF as well as any right of the reuse of collateral or any guarantee granted under the leveraging arrangement;

• (b) the total amount of leverage employed by that AIF.

Reporting obligations to competent authorities.

• (b) It shall provide information on the main instruments in which it is trading, on markets of which it is a member or where it actively trades, and on the principal exposures and most important concentrations of each AIF it manages.

• (2) An AIFM shall, for each EU AIF it manages and for each AIF it markets in the European Union, provide the following information to the Bank:

• (a) the percentage of the AIF’s assets which are subject to special arrangements arising from their illiquid nature;

• (b) any new arrangements for managing the liquidity of the AIF;

• (c) the current risk profile of the AIF and the risk management systems employed by the AIFM to manage the market risk, liquidity risk, counterparty risk and other risks including operational risk;

• (d) information on the main categories of assets in which the AIF invested; and

• (e) the results of the stress tests performed in accordance with Regulations 16(6)(b) and 17(2).

• (3) The AIFM shall, on request, provide the following documents to the Bank:

• (a) an annual report of each EU AIF managed by the AIFM and of each AIF marketed by it in the European Union, for each financial year, in accordance with Regulation 23(1);

• (b) for the end of each quarter a detailed list of every AIF which the AIFM manages.

• (4) An AIFM managing alternative investment funds employing leverage on a substantial basis shall make available to the Bank information about the overall level of leverage employed by each AIF it manages, a breakdown between leverage arising from borrowing of cash or securities and leverage embedded in financial derivatives and the extent to which the AIF’s assets have been reused under leveraging arrangements.

(5)(a) That information shall include the identity of the five largest sources of borrowed cash or securities for each AIF managed by the AIFM, and the amounts of leverage received from each of those sources for each AIF.

• (b) In relation to a non-EU AIFM, the reporting obligations referred to in this paragraph shall only apply to each EU AIF managed by it and each non-EU AIF marketed by it in the European Union.

• (6) The Bank may require an AIFM to provide to it information in addition to that referred to in the preceding provisions of this Regulation, where—

• (a) in the opinion of the Bank it is necessary to do so for the effective monitoring of systemic risk, or

• (b) where requested to do so by ESMA to ensure the stability and integrity of the financial system, or to promote long term growth, and the AIFM shall comply with such a requirement.

• (7) The Bank shall inform ESMA about the additional information required by it under paragraph (6).

Chapter 6 AIFMs Managing Specific Types of AIF

DIVISION 1

AIFMS Managing Leveraged AIFS

Use of information by competent authorities, supervisory cooperation and limits to leverage.

• (2) The Bank shall ensure that all information provided to it under Regulation 25 in respect of every AIFM that it supervises and the information provided to it under Regulation 8 is made available to competent authorities of other relevant Member States, ESMA and the ESRB by means of the procedures set out in Regulation 49 on supervisory cooperation. The Bank shall, without delay, also provide information by means of those procedures, and bilaterally to the competent authorities of other Member States directly concerned, if an AIFM under its responsibility, or an AIF managed by that AIFM, could potentially constitute an important source of counterparty risk to a credit institution or other systemically relevant institutions in other MemberStates.

(3)(a) The AIFM shall demonstrate that the leverage limits set by it for each AIF it manages are reasonable and that it complies with those limits at all times.

• (b) The Bank shall assess the risks that the use of leverage by an AIFM with respect to each AIF it manages could entail, and, where deemed necessary in order to ensure the stability and integrity of the financial system, the Bank, after having notified ESMA, the ESRB and the competent authorities of the relevant AIF, shall impose limits to the level of leverage that an AIFM is entitled to employ or other restrictions on the management of the AIF with respect to each AIF under its management to limit the extent to which the use of leverage contributes to the build-up of systemic risk in the financial system or risks of disorderly markets.

• (c) The Bank shall duly inform ESMA, the ESRB and the competent authorities of the AIF, of actions taken in the foregoing respect, by means of the procedures set out in Regulation 49.

(4)(a) The notification referred to in subparagraph (c) of paragraph (3) shall be made not less than 10 working days before the proposed measure under that paragraph is intended to take effect or to be renewed.

• (b) The notification shall include details of the proposed measure, the reasons for the measure and when the measure is intended to take effect.

• (c) In exceptional circumstances, the Bank may decide that the proposed measure takes effect within the period referred to subparagraph (a).

• (5) If the Bank proposes to take action contrary to ESMA’s advice referred to in paragraph 6 or 7 of Article 25 of the Directive it shall inform ESMA, stating its reasons.

DIVISION 2

Obligations for AIFMS Managing AIFS

which Acquire Control of Non-Listed Companies and Issuers

Scope.

• (a) an AIFM managing one or more than one AIF which either individually or jointly on the basis of an agreement aimed at acquiring control, acquires control of a non-listed company in accordance with paragraph (5);

• (b) an AIFM cooperating with one or more other alternative investment fund managers on the basis of an agreement pursuant to which the alternative investment funds managed by those fund managers jointly, acquire control of a non-listed company in accordance with paragraph (5).

• (2) This Division shall not apply where the non-listed company concerned is:

• (a) a small or medium-sized enterprise within the meaning of Article 2(1) of the Annex to Commission Recommendation 2003/361/EC of 6 May 2003 concerning the definition of micro, small and medium-sized enterprises⁵ ; or

• (b) a special purpose vehicle with the purpose of purchasing, holding or administrating real

• (3) Without prejudice to paragraphs (1) and (2), Regulation 28(1) shall also apply to an AIFM that manages one or more than one AIF that acquires a non-controlling participation in a non-listed company.

• (4) Regulations 29(1), (2) and (3) and 30 shall apply also to an AIFM that manages one or more than one AIF that acquires control over issuers. For the purposes of those Regulations, paragraphs (1) and (2) of this Regulation shall apply with the necessary modifications.

(5)(a) For the purpose of this Division, in relation to a non-listed company, “control” means more than 50 per cent of the voting rights of the company.

• (b) When calculating the percentage of voting rights held by the relevant AIF, in addition to the voting rights held directly by the relevant AIF, the voting rights of the following shall be taken into account, subject to control as referred to in subparagraph (a) being established:

• (i) an undertaking controlled by the AIF; and

• (ii) a natural or legal person acting in its own name but on behalf of the AIF or on behalf of an undertaking controlled by the AIF.

• (c) The percentage of voting rights shall be calculated on the basis of all the shares to which voting rights are attached even if the exercise thereof is suspended.

• (d) Notwithstanding the definition of “control” in Regulation 5(1), for the purpose of Regulations 29(1), (2) and (3) and Regulation 31 in regard to issuers control shall be determined in accordance with Article 5(3) of Directive 2004/25/EC.

• (6) This Division shall apply subject to the conditions and restrictions set out in Article 6 of Directive 2002/14/EC.

• (7) This Division shall apply without prejudice to any stricter rules with respect to the acquisition of holdings in issuers and non-listed companies in the State.

Notification of the acquisition of major holdings and control of non-listed companies.

• (2) Where an AIF acquires, individually or jointly, control over a non-listed company pursuant to paragraph (1) of Regulation 27, the AIFM managing such an AIF shall notify the following of the acquisition of control by the AIF:

• (a) the non-listed company;

• (b) the shareholders of which the identities and addresses are available to the AIFM or can be made available by the non-listed company or through a register to which the AIFM has or can obtain access; and

• (c) the Bank.

• (3) The notification required under paragraph (2) shall contain the following additionalinformation:

• (a) the resulting situation in terms of voting rights;

• (b) the conditions subject to which control was acquired, including information about the identity of the different shareholders involved, any natural person or legal entity entitled to exercise voting rights on their behalf and, if applicable, the chain of undertakings through which voting rights are effectively held;

• (c) the date on which control was acquired.

• (4) In its notification to the non-listed company, the AIFM shall request the board of directors of the company to inform the employees’ representatives or, where there are none, the employees themselves, without undue delay of the acquisition of control by the AIF managed by the AIFM and of the information referred to in paragraph (3). The AIFM shall use its best efforts to ensure that the employees’ representatives or, where there are none, the employees themselves, are duly informed by the board of directors in accordance with this Regulation.

• (5) The notifications referred to in paragraphs (1), (2) and (3) shall be made as soon as possible, but no later than 10 working days after the date on which the AIF has reached, exceeded or fallen below the relevant threshold or has acquired control over the non-listed company.

Disclosure in case of acquisition of control.

• (a) the company concerned,

• (b) the shareholders of the company of which the identities and addresses are available to the AIFM or can be made available by the company or through a register to which the AIFM has or can obtain access; and;

• (c) the Bank.

• (2) The AIFM shall make available:

• (a) the identity of the alternative investment fund managers which either individually or in agreement with other such fund managers manage the alternative investment funds that have acquired control;

• (b) the policy for preventing and managing conflicts of interest, in particular between the AIFM, the AIF and the company, including information about the specific safeguards established to ensure that any agreement between the AIFM and the company or between the AIF and the company (or between the AIFM and both those others) is concluded at arm’s length; and

• (c) the policy for external and internal communication relating to the company in particular as regards employees.

• (3) In its notification to the company pursuant to paragraph (1)(a), the AIFM shall request the board of directors of the company to inform the employees’ representatives or, where there are none, the employees themselves, without undue delay of the information referred to in paragraph (1). The AIFM shall use its best efforts to ensure that the employees’ representatives or, where there are none, the employees themselves, are duly informed by the board of directors in accordance with this Regulation.

• (4) Where an AIF acquires, individually or jointly, control of a non-listed company pursuant to paragraph (1) of Regulation 27, the AIFM managing such AIF shall ensure that the AIF, or the AIFM acting on behalf of the AIF, disclose its intentions with regard to the future business of the non-listed company and the likely repercussions on employment, including any material change in the conditions of employment, to:

• (a) the non-listed company; and

• (b) the shareholders of the non-listed company of which the identities and addresses are available to the AIFM or can be made available by the non-listed company or through a register to which the AIFM has or can obtain access.

• (5) In addition, the AIFM managing the relevant AIF shall request and use its best efforts to ensure that the board of directors of the non-listed company makes available the information set out in paragraph (4) to the employees’ representatives or, where there are none, the employees themselves, of the non-listed company.

• (6) Where an AIF acquires control of a non-listed company pursuant to paragraph (1) of Regulation 27, the AIFM managing such an AIF shall provide the Bank and the AIF’s investors with information on the financing of the acquisition.

Specific provisions regarding the annual report of AIFs exercising control of non-listed companies.

• (a) request and use its best efforts to ensure that the annual report of the non-listed company drawn up in accordance with paragraph (2) is made available by the board of directors of the company to the employees’ representatives or, where there are none, to the employees themselves within the period such annual report has to be drawn up in accordance with the national applicable law; or

• (b) for each such AIF include in the annual report provided for in Regulation 23 the information referred to in paragraph (2) relating to the relevant non-listed company.

• (2) The additional information to be included in the annual report of the company or the AIF, in accordance with paragraph (1), shall include at least a fair review of the development of the company’s business representing the situation at the end of the period covered by the annual report. The report shall also give an indication of:

• (a) any important events that have occurred since the end of the financial year;

• (b) the company’s likely future development; and

• (c) the information concerning acquisitions of own shares prescribed by Article 22(2) of Council Directive 77/91/EEC⁶ .

• (3) The AIFM managing the relevant AIF shall either:

• (a) request and use its best efforts to ensure that the board of directors of the non-listed company makes available the information referred to in paragraph (1)(b) relating to the company concerned to the employees’ representatives of the company concerned or, where there are none, to the employees themselves within the period referred to in Regulation 23(1); or

• (b) make available the information referred to in paragraph (1)(a) to the investors of the AIF, in so far as already available, within the period referred to in Regulation 23(1) and, in any event, no later than the date on which the annual report of the non-listed company is drawn up in accordance with the national applicable law.

Asset stripping.

• (a) not facilitate, support or instruct any distribution, capital reduction or share redemption or acquisition (or redemption and acquisition) of own shares by the company as described in paragraph (2);

• (b) in so far as the AIFM is authorised to vote on behalf of the AIF at the meetings of the governing bodies of the company, not vote in favour of a distribution, capital reduction or share redemption (or redemption and acquisition) of own shares by the company as described in paragraph (2); and

• (c) in any event use its best efforts to prevent distributions, capital reductions or share redemptions or acquisition (or redemption and acquisition) of own shares by the company as described in paragraph (2).

• (2) The obligations imposed on an AIFM pursuant to paragraph (1) shall relate to the following:

• (a) any distribution to shareholders made when on the closing date of the last financial year the net assets as set out in the company’s annual accounts are, or following such a distribution would become, lower than the amount of the subscribed capital plus those reserves which may be not distributed under the law or the statutes, and, for the purposes of this subparagraph, where the uncalled part of the subscribed capital is not included in the assets shown in the balance sheet, this amount shall be deducted from the amount of subscribed capital;

• (b) any distribution to shareholders the amount of which would exceed the amount of the profits at the end of the last financial year plus any profits brought forward and sums drawn from reserves available for this purpose, less any losses brought forward and sums placed to reserve in accordance with the law or the statutes;

• (c) to the extent that acquisitions of own shares are permitted, the acquisitions by the company, including shares previously acquired by the company and held by it, and shares acquired by a person acting in his own name but on the company’s behalf, that would have the effect of reducing the net assets below the amount mentioned in subparagraph (a).

• (3) For the purposes of paragraph (2):

(a)“distribution” in subparagraphs (a) and (b) of that paragraph includes, in particular, the payment of dividends and of interest relating to shares;

• (b) the provisions on capital reductions shall not apply on a reduction in the subscribed capital, the purpose of which is to offset losses incurred or to include sums of money in a non-distributable reserve provided that, following that operation, the amount of such reserve is not more than 10 per cent of the reduced subscribed capital; and

• (c) the restriction set out in subparagraph (c) of that paragraph shall be subject to points (b) to (h) of Article 20(1) of Directive 77/91/EEC.

Chapter 7 Marketing and managing EU AIFs

Marketing of units or shares of EU AIFs managed by Irish AIFMs in the State.

• (b) Where the EU AIF is a feeder AIF the right to market referred to in subparagraph (a) is subject to the condition that the master AIF is also an EU AIF which is managed by an authorised EU AIFM.

• (2) The Irish AIFM shall notify the Bank of each EU AIF that it intends to market in the State. That notification shall comprise the documentation and information set out in Schedule 3.

(3)(a) Within 20 working days following receipt of a complete notification file pursuant to paragraph (2), the Bank shall inform the Irish AIFM whether it may start marketing the EU AIF identified in the notification referred to in paragraph (2). The Bank shall prevent the marketing of the EU AIF only if the Irish AIFM’s management of the EU AIF does not or will not comply with these Regulations or the Irish AIFM otherwise does not or will not comply with these Regulations. In the case of a decision to permit such marketing, the Irish AIFM may start marketing the EU AIF in the State from the date of the notification by the Bank to that effect.

• (b) Where the EU AIF is regulated by the competent authorities of another Member State, the Bank shall also inform those competent authorities that the Irish AIFM may start marketing units or shares of the EU AIF in the State.

(4)(a) In the event of a material change to any of the particulars provided in accordance with paragraph (2), the Irish AIFM shall give written notice of that change to the Bank—

• (i) in the case of any change planned by the AIFM — at least 1 month before implementing the change, or

• (ii) in the case of where an unplanned change has occurred — immediately after its occurrence.

• (b) If, pursuant to a planned change, the Irish AIFM’s management of the EU AIF would no longer comply with these Regulations or the Irish AIFM would otherwise no longer comply with these Regulations, the Bank shall inform the Irish AIFM without undue delay that it is not to implement the change.

• (c) If, notwithstanding the requirements of subparagraphs (a) and (b), a planned change is implemented or if an unplanned change has taken place pursuant to which the Irish AIFM’s management of the EU AIF no longer complies with these Regulations or the Irish AIFM otherwise no longer complies with these Regulations, the Bank shall take all due measures in accordance with Regulation 49, including, if necessary, the express prohibition of marketing of the EU AIF in the State.

• (5) Without prejudice to Regulation 44(1), an EU AIF managed and marketed by an Irish AIFM may only be marketed in the State to professional investors.

Other Cases of Marketing of Units or Shares of EU AIFs.

• (2) An authorised AIFM from another Member State may market units or shares of an EU AIF that it manages to professional investors in the State as soon as the conditions specified in Article 32 of the Directive are met.

• (3) Where the EU AIF is a feeder AIF the right to market referred to in paragraphs (1) and (2) is subject to the condition that the master AIF is also an EU AIF and is managed by an authorised EU AIFM.

• (4) The Irish AIFM shall submit a notification to the Bank in respect of each EU AIF that it intends to market in another Member State. That notification shall comprise the documentation and information set out in Schedule 4.

(5)(a) The Bank shall, no later than 20 working days after the date of receipt of the complete notification file referred to in paragraph (4), transmit the complete notification file to the competent authorities of the Member States where it is intended that the EU AIF be marketed. Such transmission shall occur only if the Irish AIFM’s management of the EU AIF complies with and will continue to comply with these Regulations and if the Irish AIFM otherwise complies with these Regulations..

• (b) The Bank shall enclose a statement to the effect that the Irish AIFM concerned is authorised to manage an EU AIF with a particular investment strategy.

• (c) Upon transmission of the notification file, the Bank shall, without delay, notify the Irish AIFM about the transmission. The Irish AIFM may start marketing the EU AIF in the host Member State of the Irish AIFM as of the date of that notification.

• (d) Where the EU AIF is regulated by the competent authorities of another Member State, the Bank shall also inform those competent authorities that the Irish AIFM may start marketing units or shares of the EU AIF in that other Member State.

(6)(a) The notification letter by the Irish AIFM referred to in paragraph (4) and the statement referred to in paragraph (5)(b) shall be in the English language.

• (b) Where the Bank receives a notification from a competent authority of the home Member State of an EU AIFM in compliance with the obligations set out in paragraph 3 of Article 32 of the Directive, the Bank shall accept that notification if transmitted or filed by electronic means or otherwise in writing.

(7)(a) In the event of a material change to any of the particulars provided in accordance with paragraph (4), the Irish AIFM shall give written notice of that change to the Bank—

• (i) in the case of any change planned by the AIFM — at least 1 month before implementing the change, or

• (ii) in the case of where an unplanned change has occurred — immediately after its occurrence.

• (b) If, pursuant to a planned change, the Irish AIFM’s management of the EU AIF would no longer comply with these Regulations or the Irish AIFM would otherwise no longer comply with these Regulations, the Bank shall inform the Irish AIFM without undue delay that it is not to implement the change.

• (c) If, notwithstanding the requirements of subparagraphs (a) and (b), a planned change is implemented or if an unplanned change has taken place pursuant to which the Irish AIFM’s management of the EU AIF would no longer comply with these Regulations or the Irish AIFM otherwise would no longer comply with these Regulations, the Bank shall take all due measures in accordance with Regulation 49, including, if necessary, the express prohibition of marketing of the EU AIF in other Member States.

• (d) If the changes are acceptable because they do not affect the compliance of the Irish AIFM’s management of the EU AIF with these Regulations, or compliance by the Irish AIFM with these Regulations otherwise, the Bank shall, without delay, inform the competent authorities of the host Member State of the Irish AIFM of thosechanges.

• (8) Without prejudice to Regulation 44(1), an EU AIF managed by an AIFM from another Member State and marketed in the State may only be marketed to professional investors.

Conditions for Irish AIFMs managing EU AIFs established in other Member States and for AIFMs from other Member States managing Irish AIFs.

• (2) An authorised AIFM from another Member State may manage an Irish AIF either directly or by establishing a branch in the State, provided that the AIFM is authorised to manage that type of AIF.

• (3) An Irish AIFM intending to manage an EU AIF established in another Member State for the first time shall provide the following information to the Bank:

• (a) the Member State in which it intends to manage the EU AIF directly or establish a branch;

• (b) a programme of operations stating in particular the services which it intends to perform and identifying the EU AIF it intends to manage.

• (4) If the Irish AIFM intends to establish a branch in another Member State, it shall provide the following information in addition to that referred to in paragraph (3):

• (a) the organisational structure of the branch;

• (b) the address in the home Member State of the EU AIF from which documents may beobtained;

• (c) the names and contact details of the persons responsible for the management of thebranch.

(5)(a) The Bank shall, within 1 month after receiving the complete documentation in accordance with paragraph (3) or within 2 months after receiving the complete documentation in accordance with paragraph (4), transmit the complete documentation to the competent authorities of the host Member State of the Irish AIFM. Such transmission shall occur only if the Irish AIFM’s management of the EU AIF complies, and will continue to comply, with these Regulations and the Irish AIFM otherwise complies with these Regulations.

• (b) The Bank shall enclose a statement to the effect that the Irish AIFM concerned is authorised by it. The Bank shall immediately notify the Irish AIFM about the transmission.

• (c) Upon receipt of the transmission notification the Irish AIFM may start to provide its services in its host Member State.

(6)(a) In the event of a change to any of the information provided in accordance with paragraph (3), and, where relevant, paragraph (4), an Irish AIFM shall give written notice of that change to the Bank—

• (i) in the case of any change planned by the AIFM — at least 1 month before implementing the change, or

• (ii) in the case of where an unplanned change has occurred — immediately after its occurrence.

• (b) If, pursuant to a planned change, the Irish AIFM’s management of the EU AIF would no longer comply with these Regulations or the Irish AIFM would otherwise no longer comply with these Regulations, the Bank shall inform the Irish AIFM without undue delay that it is not to implement the change.

• (c) If, notwithstanding the requirements of subparagraphs (a) and (b), a planned change is implemented, or if an unplanned change has taken place pursuant to which the Irish AIFM’s management of the EU AIF would no longer comply with these Regulations or the Irish AIFM otherwise would no longer comply with these Regulations, the Bank shall take all due measures in accordance with Regulation 49.

• (d) If the changes are acceptable because they do not affect the compliance of the Irish AIFM’s management of the EU AIF with these Regulations, or the compliance by the Irish AIFM with these Regulations otherwise, the Bank shall, without undue delay, inform the competent authorities of the host Member States of the Irish AIFM of those changes.

Chapter 8 Specific Rules In Relation to Third Countries

Conditions for Irish AIFMs which manage non-EU AIFs which are not marketed in Member States.

• (a) the Irish AIFM complies with all the requirements provided for in these Regulations, other than Regulations 22 and 23, in respect of that non-EU AIF; and

• (b) appropriate cooperation arrangements are in place between the Bank and the supervisory authorities of the third country where the non-EU AIF is established in order to ensure at least an efficient exchange of information that enables the Bank to carry out its duties in accordance with these Regulations.

Conditions for marketing, with a passport, of non-EU AIFs in the European Union or in the State by, respectively, Irish AIFMs and Other Member State AIFMs.

• (2) An authorised AIFM from another Member State may market to professional investors in the State units or shares of an non-EU AIF it manages and of an EU feeder AIF that does not fulfil the requirements referred to in the second subparagraph of Article 31(1) of the Directive as soon as the conditions specified in Article 35 of the Directive are met.

• (3) An Irish AIFM marketing units or shares as mentioned in paragraph (1) shall comply with all the requirements provided for in these Regulations, other than Chapter 7. In addition the following conditions shall be met:

• (a) appropriate cooperation arrangements are in place between the Bank and the supervisory authorities of the third country where the non-EU AIF is established in order to ensure at least an efficient exchange of information, taking into account Regulation 54(3), that enables the Bank to carry out its duties in accordance with these Regulations;

• (b) the third country where the non-EU AIF is established is not listed as a NonCooperative Country and Territory by FATF;

• (c) the third country where the non-EU AIF is established has signed an agreement with the State and with each other Member State in which the units or shares of the non-EU AIF are intended to be marketed, which complies with the standards laid down in Article 26 of the OECD Model Tax Convention on Income and Capital and ensures an effective exchange of information in tax matters, including any multilateral tax agreements.

(4)(a) An AIFM from another Member State marketing units or shares as mentioned in paragraph (2) shall comply with all the requirements provided for in the Directive, other than Chapter VI. In addition the following conditions shall be met:

• (i) appropriate cooperation arrangements shall be in place between the competent authorities of the home Member State of the AIFM and the supervisory authorities of the third country where the non-EU AIF is established in order to ensure at least an efficient exchange of information, taking into account Article 50(4), that enables the competent authorities to carry out their duties in accordance with this Directive;

• (ii) the third country where the non-EU AIF is established is not listed as a NonCooperative Country and Territory by FATF;

• (iii) the third country where the non-EU AIF is established has signed an agreement with the home Member State of the authorised AIFM and with the State, which complies with the standards laid down in Article 26 of the OECD Model Tax Convention on Income and Capital and ensures an effective exchange of information in tax matters, including any multilateral tax agreements.

• (b) Where the Bank, in the case of an AIFM authorised in another Member State, disagrees with the assessment made on the application of clauses (i) and (ii) of subparagraph (a) by the competent authorities of the home Member State of the AIFM, the Bank may refer the matter to ESMA.

• (5) If an Irish AIFM intends to market units or shares of one or more than one non-EU AIF in the State, the Irish AIFM shall submit a notification to the Bank in respect of each non-EU AIF that it intends to market. That notification shall comprise the documentation and information set out in Schedule 3.

(6)(a) No later than 20 working days following receipt of a complete notification pursuant to paragraph (5), the Bank shall inform the Irish AIFM whether it may start marketing the non-EU AIF identified in the notification referred to in paragraph (5) in the State. The Bank shall prevent the marketing of the non-EU AIF only if the Irish AIFM’s management of the non-EU AIF does not or will not comply with these Regulations or the Irish AIFM otherwise does not or will not comply with these Regulations. In the case of a decision to permit such marketing, the Irish AIFM may start marketing the non-EU AIF in the State as of the date of the notification by the Bank to that effect.

• (b) The Bank shall also inform ESMA that the Irish AIFM may start marketing the units or shares of the non-EU AIF in the State.

• (7) If an Irish AIFM intends to market units or shares of one or more than one non-EU AIF in another Member State, the Irish AIFM shall submit a notification to the Bank in respect of each non-EU AIF that it intends to market. That notification shall comprise the documentation and information set out in Schedule 4.

(8)(a) The Bank shall, no later than20working days after the date of receipt of the complete authorities of the Member State where the non-EU AIF is intended to be marketed. Such transmission will occur only if the Irish AIFM’s management of the non-EU AIF complies and will continue to comply with these Regulations and that the Irish AIFM otherwise complies with these Regulations.

• (b) The Bank shall enclose a statement to the effect that the Irish AIFM concerned is authorised to manage a non-EU AIF with a particular investment strategy.

• (c) Upon transmission of the notification file, the Bank shall, without delay, notify the Irish AIFM about the transmission. The Irish AIFM may start marketing the non-EU AIF in the relevant host Member States of the Irish AIFM as of the date of that notification by the Bank.

• (d) The Bank shall also inform ESMA that the Irish AIFM may start marketing the units or shares of the non-EU AIF in the host Member States of the Irish AIFM.

(9)(a) Arrangements referred to in paragraph (h) of Schedule 4 shall be subject to the laws and supervision of the host Member States of the Irish AIFM.

• (b) Arrangements referred to in paragraph (h) of Schedule 4 shall be subject to the laws and supervision of the Bank where the State is the host Member State of an AIFM from another Member State.

(10)(a) The notification letter of the Irish AIFM referred to in paragraph (7) and the statement referred to in paragraph (8) shall be in the English language.

• (b) Where the Bank receives a notification from a competent authority of the home Member State of an AIFM from another Member State in compliance with the obligations set out in paragraph 6 of Article 35 of the Directive, the Bank shall accept that notification if transmitted or filed by electronic means or otherwise in writing.

(11)(a) In the event of a material change to any of the particulars provided in accordance with paragraph (5) or (7), the Irish AIFM shall give written notice of that change to the Bank—

• (i) in the case of any change planned by the AIFM — at least 1 month before implementing the change, or

• (ii) in the case of where an unplanned change has occurred — immediately after its occurrence.

• (b) If pursuant to a planned change, the Irish AIFM’s management of the non-EU AIF would no longer comply with these Regulations or the Irish AIFM would no longer comply with these Regulations, the Bank shall inform the Irish AIFM without undue delay that it is not to implement the change.

• (c) If, notwithstanding the requirements of subparagraphs (a) and (b), a planned change is implemented, or if an unplanned change has taken place pursuant to which the Irish AIFM’s management of the non-EU AIF would no longer comply with these Regulations or the Irish AIFM otherwise would no longer comply with these Regulations, the Bank shall take all due measures in accordance with Regulation 49, including, if necessary, the express prohibition of marketing of the non-EU AIF.

• (d) If the changes are acceptable because they do not affect the compliance of the Irish AIFM’s management of the non-EU AIF with these Regulations, or the compliance by the Irish AIFM with these Regulations otherwise, the Bank shall, without delay, inform ESMA in so far as the changes concern the termination of the marketing of certain non-EU alternative investment funds or additional non-EU alternative investment funds marketed and, if applicable, the competent authorities of the host Member States of the Irish AIFM of those changes.

• (12) In case a competent authority from another Member State rejects a request from the Bank to exchange information in accordance with the regulatory technical standards developed by ESMA pursuant to Article 35 (14) of the Directive, the Bank may refer the matter to ESMA.

• (13) Without prejudice to Regulation 44(1) a non-EU AIF managed and marketed by an Irish AIFM may be marketed only to professional investors.

• (14) Without prejudice to Regulation 44(1), a non-EU AIF managed and marketed in the State by an AIFM from another Member State may be marketed only to professional investors.

Conditions for the marketing in the State without a passport of non-EU AIFs managed by an Irish AIFM or an AIFM from another Member State.

• (2) An authorised Irish AIFM may market to professional investors, in the State, units or shares of a non-EU AIF it manages and of an EU feeder AIF that does not fulfil the requirements referred to in Regulation 32(1)(b), provided that:

• (a) the Irish AIFM complies with all the requirements provided for in these Regulations other than Regulation 22. That Irish AIFM shall however ensure that one or more entities are appointed to carry out the duties referred to in Regulation 22(7), (8) and (9). The Irish AIFM shall not perform those functions. The Irish AIFM shall provide the Bank with information about the identity of those entities responsible for carrying out the duties referred to in Regulation 22(7), (8) and (9);

• (b) appropriate cooperation arrangements for the purpose of systemic risk oversight and in line with international standards are in place between the Bank and the supervisory authorities of the third country where the non-EU AIF is established in order to ensure an efficient exchange of information that allows the Bank to carry out its duties in accordance with these Regulations;

• (c) the third country where the non-EU AIF is established is not listed as a NonCooperative Country and Territory by FATF.

• (3) An authorised AIFM from another Member State may market to professional investors, in the State, units or shares of a non-EU AIF it manages and of an EU feeder AIF that does not fulfil the requirements referred to in the second subparagraph of Article 31(1) of the Directive, provided that:

• (a) the AIFM complies with all the requirements provided for in the Directive other than Article 21. That AIFM shall however ensure that one or more entities are appointed to carry out the duties referred to in Article 21(7), (8) and (9) of the Directive. The AIFM shall not perform those functions. The AIFM shall provide its supervisory authorities with information about the identity of those entities responsible for carrying out the duties referred to in Article 21(7), (8) and (9) of the Directive;

• (b) appropriate cooperation arrangements for the purpose of systemic risk oversight and in line with international standards are in place between the competent authorities of the home Member State of the AIFM and the supervisory authorities of the third country where the non-EU AIF is established in order to ensure an efficient exchange of information that allows the competent authorities of the home Member State of the AIFM to carry out their duties in accordance with the Directive;

• (c) the third country where the non-EU AIF is established is not listed as a NonCooperative Country and Territory by FATF.

• (4) An AIFM falling with paragraph (2) or (3) shall give written notification to the Bank before marketing to professional investors in the State units or shares of an AIF managed by it that falls within paragraph (2) or (3).This notification shall include the name of the AIFM and the AIF and the identity of the home Member State of the AIFM and the jurisdiction where the AIF is domiciled.

(5)(a) Without prejudice to the power of the Bank to impose conditions or requirements under these Regulations, where the Bank considers it necessary for the proper and orderly regulation and supervision of alternative investment fund managers, the Bank may impose conditions or requirements, in addition to those specified in paragraph (2) or (3), as the case may be, on an AIFM that markets in the State to professional investors units or shares of an non-EU AIF it manages and of an EU feeder AIF that does not fulfil the requirements referred to in Regulation 32(1)(b).

• (b) A condition or requirement imposed by the Bank under this paragraph has effect from the date specified by the Bank.

Authorisation of non-EU AIFMs intending to manage Irish AIFs or market AIFs managed by them in the European Union in accordance with Regulation 40 or 41.

• (2) A non-EU AIFM intending to obtain the authorisation referred to in paragraph (1) shall comply with these Regulations, with the exception of Chapter 7. If and to the extent that compliance with a provision of these Regulations is incompatible with compliance with the law to which the non-EU AIFM or the non-EU AIF marketed in the European Union is (or both are) subject, there shall be no obligation on the AIFM to comply with that provision of these Regulations if it can demonstrate that:

• (a) it is impossible to combine such compliance with compliance with a mandatory provision in the law to which the non-EU AIFM or the non-EU AIF marketed in the European Union is (or both are) subject;

• (b) the law to which the non-EU AIFM or the non-EU AIF is (or both are) subject provides for an equivalent rule having the same regulatory purpose and offering the same level of protection to the investors of the relevant AIF; and

• (c) the non-EU AIFM or the non-EU AIF complies, or, as the case may be, both comply, with the equivalent rule referred to in subparagraph (b).

• (3) A non-EU AIFM intending to obtain the authorisation referred to in paragraph (1) shall have a legal representative established in the State. The legal representative shall be the contact point of the AIFM in the European Union and any official correspondence between the competent authorities, including the Bank, and the AIFM and between the investors in the European Union of the relevant AIF and the AIFM as set out in these Regulations shall take place through that legal representative. The legal representative shall perform the compliance function relating to the management and marketing activities performed by the AIFM under these Regulations together with the AIFM.

• (4) The State shall be determined to be the Member State of reference of a non-EU AIFM if:

• (a) the non-EU AIFM intends to manage only Irish alternative investment funds, and does not intend to market any AIF in accordance with Regulation 40 or 41 in the European Union;

• (b) the non-EU AIFM intends to manage several EU alternative investment funds established in different MemberStates and does not intend to market any AIF in accordance with Regulation 40 or 41 in the European Union, and either:

• (i) most of the alternative investment funds are Irish alternative investment funds, or

• (ii) the State is the Member State where the largest amount of assets is being managed;

• (c) the non-EU AIFM intends to market only one EU AIF in only one Member State and:

• (i) the AIF is authorised or registered in the State or the AIFM intends to market the AIF in the State, or

• (ii) the AIFM intends to market the AIF in the State and the AIF is not authorised or registered in a Member State;

• (d) the non-EU AIFM intends to market only one non-EU AIF in only one MemberState namely the State;

• (e) the non-EU AIFM intends to market only one EU AIF, but in different Member States and:

• (i) the AIF is authorised or registered in the State or the State is one of the Member States where the AIFM intends to develop effective marketing, or

• (ii) the AIF is not authorised or registered in a Member State and the State is one of the MemberStates where the AIFM intends to develop effective marketing;

• (f) the non-EU AIFM intends to market only one non-EU AIF, but in different Member States and the State is one of those Member States;

• (g) the non-EU AIFM intends to market several EU alternative investment funds in the European Union and:

• (i) those alternative investment funds are all registered or authorised in the State or the State is the Member State where the AIFM intends to develop effective marketing for most of those funds,

• (ii) in so far as those alternative investment funds are not all registered or authorised in the same Member State, the State is the Member State where the AIFM intends to develop effective marketing for most of those funds;

• (h) the non-EU AIFM intends to market several EU and non-EU alternative investment funds, or several non-EU alternative investment funds in the European Union and the State is the Member State where it intends to develop effective marketing for most of those funds.

(5)(a) Where, by virtue of the application of the criteria set out in subparagraph (b),(c)(i), (e), (f) or (g)(i) of paragraph (4), there is, in addition to the State, one, or more than one, other possible Member State of reference then, upon receipt of a request from a non-EU AIFM intending, in accordance with Regulation 40 or 41, to—

• (i) manage Irish alternative investment funds without marketing them,

• (ii) market alternative investment funds managed by it in the European Union, or

• (iii) do both of the foregoing things,

the Bank shall, jointly with the competent authorities of the other possible Member States of reference, determine which Member State shall be the Member State of reference for the non-EU AIFM; that determination shall be made within 1 month after receipt of the request.

• (b) Where the State is determined to be the Member State of reference in accordance with the procedures under subparagraph (a), the Bank shall, without undue delay, inform the non-EU AIFM of that determination. If the non-EU AIFM is not duly informed by the Bank of the determination made by the relevant competent authorities within 7 days after the determination or if the relevant competent authorities have not made a determination within the period referred to in subparagraph (a), the non-EU AIFM may itself choose its Member State of reference based on the criteria set out in paragraph (4).

• (6) For the purposes of paragraph (4), proof by an AIFM of its intention to develop effective marketing in a particular Member State may be provided by its disclosing to the Bank its marketing strategy.