National Private Placement Regime - Financial Conduct Authority

National Private Placement Regime

The AIFMD National Private Placement Regime (NPPR) is a mechanism to allow Alternative Investment Fund Managers (AIFMs) to market Alternative Investment Funds (AIFs) that are not allowed to be marketed under the AIFMD domestic marketing or passporting regimes. This principally relates to the marketing of non-EEA AIFs and AIFs managed by non-EEA AIFMs. However, it also relates to the marketing of feeder AIFs where the master AIFM is a non-EEA AIFM or the master AIF is a non-EEA AIF.

To be able to market under NPPR, an AIFM must satisfy a number of conditions, as detailed in regulations 57, 58 and 59 of the UK Alternative Investment Fund Managers Regulations 2013 (the Treasury’s Regulations). An AIFM must ensure that it is aware of these conditions and that they are met before making a notification.  NPPR is available to the following managers:

  • UK and EEA AIFMs marketing non-EEA AIF(s) (or feeder AIFs that are UK AIFs or EEA AIFs where the master AIF is a managed by a non-EEA AIFM or is a non-EEA AIF); and
  • non-EEA AIFMs marketing AIF(s), whether UK, EEA or non-EEA AIF(s).

To use NPPR in the UK, AIFMs must notify us if they intend to market the types of AIF listed above. The notification requires a declaration from the AIFM that the management of the AIF complies with the relevant conditions set out in the Treasury’s Regulations. As a result of marketing an AIF in the UK under NPPR, the requirements that an AIFM is subject to may change.

Notification forms for all categories of firm can be found in the Forms section below.

The Treasury’s Regulations include transitional arrangements, which mean that AIFMs that benefit from the transitional will not need to comply with NPPR until 22 July 2014 or, if earlier, until the date the firm is authorised as an AIFM (in the case of a UK or EEA AIFM), or the date that the FCA has received a NPPR marketing notification from the AIFM (in the case of a non-EEA AIFM).

Eligible AIFMs will be able to continue to use NPPR until at least 2018, and until 2015 NPPR will be the sole regime available to those managers wishing to market in the EEA. After 2015, a non-EEA marketing passport may be introduced, but this depends on a number of conditions being satisfied (as set out in the Directive).

Further details on NPPR can be found in our manual FUND 10.5 (National Private Placement).

Forms 

  • Article 36 form - For authorised UK and EEA AIFMs marketing non-EEA AIF(s) (or feeder AIFs that are UK AIFs or EEA AIFs where the master AIF is a managed by a non-EEA AIFM or is a non-EEA AIF)
  • Article 42 form - For above-threshold non-EEA AIFMs marketing AIF(s), whether UK, EEA or non-EEA AIF(s). These AIFMs will also be required to complete notifications in respect of major holdings and control acquired after the date of their marketing notification (in accordance with Part 5 of the HMT regulations) by submitting it to the email address below.
  • Small Third Country form - For sub-threshold non-EEA AIFMs marketing AIF(s), whether UK, EEA or non-EEA AIF(s). These AIFMs are requested to submit their data securely, using the mechanism outlined below.
  • We have published a guidance note to assist firms with the completion of each of the forms above.

Please note: forms may be subject to version updates. Firms should ensure they have completed the latest version of the relevant form before submitting a notification.

Please email your completed NPPR notifications to: NPPRMarketingNotification@fca.org.uk

Firms intending to submit a Small Third Country notification should send the data encrypted, by using our PGP Key.

You can use the template to notify us of multiple funds, however, only one notification file should be submitted per email, so if you are submitting more than one file, please send these on separate emails.  We will send you an email to confirm we have received your notification; please do not reply to this email as it is sent from an unmonitored email address.

The subject line of the email should contain your FRN (or firm name for new applications and for those firms that are not authorised by or registered with the FCA and therefore do not have an FRN) followed by the words ‘AIFMD NPPR Notification’.

Supervisory co-operation arrangements (MoUs)

Please see the list of signed MoUs below.

 

Albanian Financial Supervisory Authority
Alberta Securities Commission
Australian Securities and Investments Commission
Autorité des marchés financiers, Québec
Bermuda Monetary Authority
Board of Governors of the Federal Reserve System, United States of America
British Columbia Securities Commission
British Virgin Islands Financial Services Commission
Capital Markets and Securities Authority of Tanzania
Capital Markets Authority of Kenya
Capital Market Development Authority of Maldives
Capital Markets Board of Turkey
Cayman Islands Monetary Authority
Comissão de Valores Mobiliários do Brasil
Commodity Futures Trading Commission, United States of America
Conseil Déontologique des Valeurs Mobilières of Morocco
Dubai Financial Services Authority
Egyptian Financial Supervisory Authority
Financial Markets Authority of New Zealand
Financial Services Agency of Japan
Financial Services Board of South Africa
Financial Services Commission of Mauritius
Financial Supervision Commission of the Isle of Man
Guernsey Financial Services Commission
Hong Kong Securities and Futures Commission
Israel Securities Authority
Jersey Financial Services Commission
Labuan Financial Services Authority
Ministry of Agriculture, Forestry and Fisheries of Japan
Ministry of Economy, Trade and Industry of Japan
Monetary Authority of Hong Kong
Monetary Authority of Singapore
National Banking and Securities Commission of the United Mexican States
Office of the Comptroller of the Currency, United States of America
Office of the Superintendent of Financial Institutions, Canada
Ontario Securities Commission
Republic of Srpska Securities Commission
Securities and Commodities Authority of the United Arab Emirates
Securities and Exchange Board of India
Securities and Exchange Commission, United States of America
Securities and Exchange Commission of Pakistan
Securities and Exchange Commission of the Republic of Macedonia, Former Yugoslav Republic of Macedonia
Securities and Exchange Commission Thailand
Securities Commission of Malaysia
Securities Commission of the Bahamas
Securities Commission of the Republic of Montenegro
Swiss Financial Market Supervisory Authority (FINMA)

 

The MoUs are a pre-condition under the Directive to allowing certain cross-border activities to take place, and are designed to help EEA regulators supervise compliance with the AIFMD requirements when a non-EEA entity is involved in the management or marketing of an alternative investment fund within the EEA or where the AIF is established in a non-EEA jurisdiction.

In addition to this condition, AIFMD requires that the third country is not listed as a “Non-Cooperative Country and Territory” by the Financial Action Task Force (FATF).  However, the Non-Cooperative Country and Territory list is no longer maintained by FATF, which instead maintains a list of “High-risk and non-cooperative jurisdictions”.  As such, reference must now be made to this list, which consists of two parts:

  1. jurisdictions that have strategic anti-money laundering (AML)/ combating the financing of terrorism (CFT) deficiencies and to which counter-measures apply; and
  2. jurisdictions with strategic AML/CFT deficiencies that have not made sufficient progress in addressing the deficiencies or have not committed to an action plan developed with the FATF to address the deficiencies.  

We consider that the reference to “Non-Cooperative Country and Territory” should be interpreted as a reference to a jurisdiction that appears in either part of the list of “High-risk and non-cooperative jurisdictions”. Therefore, firms should be aware of the latest list published by FATF.

As noted above, EEA AIFMs must not privately place non-EEA AIFs in the UK unless the applicable MoU is in place.  ESMA has published a list of the MoUs in place between EEA and non-EEA competent authorities.

Frequently asked questions

Q1: What will happen once I have submitted a notification?

Answer:

We will send you an email to confirm receipt of your notification; please do not reply to this email as it is sent from an unmonitored email address. If we are unable to process your notification we will inform you of the reason why and ask you to resubmit. We will inform you once your notification has been successfully processed.  At this point we will issue you with a notification number and ask you to submit a cheque, in GBP, for payment in full.  Please write the notification number on the back of your cheque and send it to: NPPR Notifications, Fund Authorisations Department, Financial Conduct Authority, 25 The North Colonnade, Canary Wharf, London E14 5HS.

Q2: When will a firm be able to start marketing once a notification has been submitted to the FCA?

Answer:

Under regulation 50 of the HMT regulations a firm will be entitled to start marketing AIFs under NPPR from the point at which it has submitted its notification. However, we will send out an automated response confirming that the original notification has been successfully processed and firms may wish to wait until this confirmation is received before starting to market.

Q3: What are the FCA’s proposed application fees for AIFs marketed in the UK under national private placement?

Answer:

Please refer to our AIFMD fees page.

Q4: Can I pay for the NPPR application fee electronically?

Answer:

Yes, in view of the number of notifications expected from EEA and non-EEA AIFMs we will accept electronic payment as well as payment by cheque.

For credit transfers via BACS, CHAPS please find the FCA bank details below:

Account Name: FCA Collection account
Bank Name: Lloyds Bank Plc
Account number: 00828179
Sort code: 30-00-02
Swift/BIC Code: LOYDGB2LCTY
IBAN: GB68 LOYD 3000 0200 8281 79

When paying by credit transfer please ensure that you provide the reference "AIFMD NPPR" and the Notification ID.

Q5: What happens if I have sent my data to the wrong email address?

Answer:

It is important that you send your data to the correct email address as you may put your data at risk. You will receive confirmation by email that you have submitted your data. If you do not receive a confirmation, it is likely that you have sent your data to the wrong email address. If so, you will need to resubmit the report to the following mailbox: NPPRMarketingNotification@fca.org.uk.

Q6: Can I send my data encrypted?

Answer:

Yes. For firms submitting an Article 36 or Article 42 form this is optional while firms submitting a Small Third Country form are required to. You may send your data encrypted, by using our PGP Key.

Q7: What happens if I do not submit this data?

Answer:

If the required data is not submitted then your firm will not be able to take advantage of the National Private Placement Regime for AIFMD. There are some transitional provisions in place which may allow firms to continue to market AIFs until 21 July 2014 (at the latest). However, firms must provide notification by 21 July 2014 otherwise, after this date they will no longer be able to market their AIFs.

Q8: Which software should I use to open the template and submit the file?

Answer:

We have tested our templates with Microsoft Excel 2010 and 2003.

Q9: What happens if I have not received any acknowledgement of my notification?

Answer:

For all notification emails successfully received, an automated response will be sent to the sender. If you have not received the automated response then the notification has not be received by the FCA. We would request that you resubmit your notification email to: NPPRMarketingNotification@fca.org.uk

Q10: What will happen to an application if the relevant cooperation arrangements (MoUs) are not in place with a non-EEA competent authority?

Answer:

It is the responsibility of the firm to check whether there is an MOU in place before applying, as not doing so may result in the failure of an application or supervision/enforcement action for breaching applicable rules.

Q11: What is the maximum number of AIFs that can be entered into the notification forms?

Answer:

You can only enter up to 50 AIFs on each of the notification forms. If you have more than 50 AIFs that you wish to notify us of, you may submit more than one form.

Q12: Will the UK treat the National Private Placement Regime any differently than other EEA Member States?

Answer:

It is the responsibility of firms to understand the position of other EEA States.

Q13: When are supervisory cooperation arrangements required?

Answer:

Supervisory cooperation arrangements are required for a full scope UK AIFM or a full scope EEA AIFM to be able to market an AIF under Regulation 57 (Article 36) and for an above-threshold non-EEA AIFM to be able to market under Regulation 59 (Article 42). However, supervisory cooperation arrangements are not required for the marketing of an AIF by a small non-EEA AIFM under Regulation 58 (refer to the Treasury's Regulations for further details).

Q14: Is a supervisory cooperation arrangement required if the AIF or AIFM is not supervised in the relevant third country?

Answer:

Yes.  Our rules require that a supervisory cooperation arrangement is in place with the relevant jurisdiction whether or not the competent authority supervises the particular entity in question.

Q15: What obligations arise for an above-threshold non-EEA AIFM who has submitted a notification for the private placement of an AIF?

Answer:

The non-EEA AIFM is required to comply with the rules governing private placements in the UK. For further information, it should seek legal advice on the applicable rules. Additionally, the non-EEA AIFM must complete notifications in respect of major holdings and control acquired after the date of their marketing notification (in accordance with Part 5 of the HMT regulations).  Finally, non-EEA AIFMs must comply with the following requirements: investor information, annual reporting and reporting obligations to the FCA. For guidance, see FUND 10.5.11G.

Q16: Does a full-scope UK AIFM need to be authorised in order to apply to market via the NPPR under Regulation 57 (Article 36)?

Answer:

Yes, in accordance with Article 36(1) of the AIFMD, full-scope UK AIFMs need to be authorised before they can submit a notification to market in the UK under NPPR.

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