Positive changes introduced by the Central Bank of Ireland for the authorisation of Irish Alternative Investment Funds

      The Central Bank of Ireland (CBI) has updated the Alternative Investment Fund (AIF) authorisation section of its website. The changes introduced clarify which asset classes are required to make a pre-submission before making an application for authorisation via the 24-hour approval process.

      The CBI has streamlined the approval process and set limits for other asset classes looking for fast-track approval. This is being seen as a positive step for managers with strategies that include digital assets, private credit or real estate.

      The CBI website now states that a pre-submission is required in respect of the following asset classes:

      • Qualifying Investor AIFs proposing to invest in Irish property assets
      • Qualifying Investor AIFs proposing to invest in crypto-assets as per the Central Bank’s AIFMD Q&A ID1145.

      Significantly, AIFs that propose to invest no more than 10% of their net asset value in cash-settled Bitcoin futures traded on the Chicago Mercantile Exchange are not required to make a pre-submission.

      Details of the information required for making a pre-submission for these two asset classes can be found on the CBI website Pre-submission process for a Qualifying Investor AIF | Central Bank of Ireland

      Digital Assets

      The website update is the first time that the CBI has signalled that they are open to a meaningful discussion on digital assets as a new asset class. This development follows the CSSF’s clarification that Luxembourg AIFs can invest in digital assets.

      Perhaps unsurprisingly, the CBI announcement comes a day after the Council of the EU presidency and the European Parliament reached a provisional agreement on the markets in crypto-assets (MiCA). The proposal covers issuers of unbacked crypto-assets and so-called “stablecoins” and the trading venues and wallets where crypto-assets are held.

      Loan Origination Funds and non-Irish Property Funds

      Another positive development for the Irish Funds industry is that the CBI has removed the pre-submission requirement for Loan Origination QIAIFs (L-QIAIFs) and QIAIFs investing in non-Irish property.

      Waystone has seen an increased interest in institutional managers looking to set up private asset structures using the updated Irish Limited Partnership model. This change to the authorisation process will now provide clarity to investment managers for launch dates and speed to market.

      Partnering with Waystone

      Waystone has extensive experience in real estate and credit funds, partnering with leading institutional managers from across the globe in these assets classes. Our recent article about the regulatory changes benefitting debt funds in Europe highlights the opportunities.

      We will continue monitoring regulatory developments for digital assets through MiCA and will work with our partners seeking to utilise this new asset class in Europe.

      If you are considering launching a private credit, real estate or digital asset fund in Europe, please get in touch with your usual Waystone representative or contact us below.

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