What Hedge Fund Managers Need to Know About AIFMD’s Depositary Requirement (Part Two of Two)
William V. de Cordova
Hedge Fund Law Report
Among the changes imposed on hedge fund managers by the Alternative Investment Fund Managers Directive (AIFMD) is the European requirement to appoint a fund depositary. Hedge fund managers may be subject to different depositary regimes depending on their and their funds’ domiciles, and appointing a depositary requires attention to numerous practical and operational details. In a recent interview with Hedge Fund Law Report, Bill Prew, founder and CEO of INDOS Financial Limited, discussed AIFMD’s impact on the hedge fund industry since its introduction in July 2014. This article, the second in a two-part series, sets forth Prew’s thoughts about the practical implications of the new depositary requirements, as well as other industry trends and issues for hedge fund managers. In the first installment, Prew discussed the effect of AIFMD on hedge fund managers and their ability to market funds across Europe. For more on depositary requirements under AIFMD, see our two-part series “Application of the AIFMD to Non-E.U. Alternative Investment Fund Managers”: Part One (May 23, 2013); and Part Two (Jun. 13, 2013); as well as “AIFM Directive: Loosening the Regulatory Noose” (Jun. 17, 2009).