Luxembourg legal update — March 2013: the ESMA guidelines on sound remuneration policies of AIFMs
This section of Arendt & Medernach’s Luxembourg legal update for March 2013 looks at the ESMA guidelines on sound remuneration policies of AIFMs.
With regard to the recent developments in the context of the AIFMD, on 11 February 2013 the European Securities and Markets Authority (ESMA) published its final Guidelines on sound remuneration policies under the Alternative Investment Fund Managers Directive (AIFMD; the directive).
Pursuant to Article 13 (2) of the AIFMD, ESMA was entrusted with the task of adopting guidelines on sound remuneration policies which comply with the remuneration policy principles laid down in Annex II of the Directive. The underlying aims of these guidelines are to curb excessive risk taking by alternative fund managers and to help to align the interests of both fund managers and investors.
This information focuses on key principles of the final guidelines, which are similar to the remuneration policy rules applicable to banks and investment firms (see our Newsflash of December 2010 regarding CEBS Guidelines on remuneration policy)…
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The AIFMD is the outcome of a G20 consensus for closer regulatory oversight of systemic risks emanating from certain players and activiries in the alternative investment funds sector.