“Ambitious in its objectives, the parliament is also realistic and wants ELTIFs to be a successful vehicle. For this reason, parliament has ensured certain opportunities for flexibility around lifecycles of ELTIFs and redemption rights, in particular for retail investors, without taking the focus away from the long term. Long-term financing is and has to continue to be an absolute priority for Europe and its citizens, and once in place this legislation should have a very positive knock-on effect on the real economy and Europe’s ongoing economic recovery.”
Julie Patterson, director of regulatory affairs – investment funds and retail at the IMA, says: “We are only at the first stage of the EU debate. The vote signals that the EP has agreed its opening position for ‘Trialogue’. The Council has only recently begun its discussions on the commission’s proposals. Even if the council reaches a common position soon, Trialogue will not now begin until September or October at the earliest (after the newly-elected MEPs have agreed who is to be the rapporteur and shadow rapporteurs for this file).
“So, there is still some way to go before we have a clear view of what the final text will look like. The commission’s proposal allows ELTIFs to be sold to both retail and professional investors, but it is too early to say what the council position may be on this question. However, it seems likely that at least some types of retail investors will have access to ELTIFs, such as the high net worth. Therefore, the open question is whether other retail investors (such as those within personal pension schemes) will have access to ELTIFs sold cross border.
“Whatever the outcome, individual member states can still allow ELTIFs to be sold within their own jurisdiction to their own citizens.”
