European Market Entry

We are experts in the legal framework governing the distribution of investment funds across Germany and Europe, with a specific focus on advising North American asset managers and fund companies entering the European market for the first time. Our expertise centers on the regulatory landscape under the German Capital Investment Code (Kapitalanlagegesetzbuch, KAGB), the UCITS Directive, and the Alternative Investment Fund Managers Directive (AIFMD), which together establish the key legal standards for cross-border fund distribution in the European Union.

Under the UCITS Directive, we provide guidance on utilizing the EU passport to distribute harmonized retail investment funds across multiple member states efficiently, ensuring compliance with national marketing requirements and managing the necessary notifications. For alternative investment funds (AIFs), we assist in navigating AIFMD obligations, focusing on the nuances between full-scope AIFM authorizations and lighter registration requirements, depending on the target investor base of the fund.

Our expertise also includes advising on “private placement” regimes, which remain available in certain jurisdictions for distributing AIFs outside the public marketing framework. We help fund managers understand and leverage these opportunities where relevant, ensuring compliance with the local variations in private placement regulations. Equally important is our guidance on the recent EU rules concerning “pre-marketing,” which allow for initial discussions with potential professional investors under specific conditions. We ensure that asset managers can effectively initiate interest in their funds without breaching regulatory boundaries, including adhering to the formal notification requirements imposed under AIFMD since 2021.

Furthermore, we provide detailed support in understanding the categorization of investors, specifically the distinctions between professional and semi-professional investors under both KAGB and AIFMD. This differentiation is crucial, as it impacts marketing strategies, compliance obligations, and reporting requirements. Our goal is to simplify complex regulatory pathways and provide strategic, practical advice, enabling fund managers to effectively and compliantly access European markets, maximizing their distribution opportunities while ensuring adherence to all necessary legal frameworks.