PROVISIONAL AGREEMENT RESULTING FROM INTERINSTITUTIONAL NEGOTIATIONS Proposal for a directive of the European Parliament and of the Council Amending Directives 2011/61/EU and 2009/65/EC as regards delegation arrangements, liquidity risk management, supervisory reporting, provision of depositary and custody services and loan origination by alternative investment funds

Following several months of informal negotiations between the representatives of the EP, the CEU and the EC, the EP has now published the provisional agreement on the legislative proposal for a Directive amending the AIFMD and the UCITS Directive, which is acceptable to both the Parliament and the Council. This provisional agreement still has to be adopted as part of the formal procedure.
The key features of the current version of the provisional agreement are as follows:
1. Improvement of the availability of instruments for liquidity management, requiring fund managers to provide for the activation of these. This will help ensure that fund managers are well equipped to deal with significant outflows in times of financial turbulence.
2. Framework for funds originating loans, i.e. funds that grant loans to companies. This framework is complemented by a number of requirements to mitigate risks to financial stability as well as to guarantee sufficient investor protection.
3. Enhanced rules for the delegation of tasks by investment managers to third parties, allowing them to better utilise the resources of market specialists, subject to strengthened supervision and the preservation of market integrity.
In addition, the agreement includes increased data sharing and cooperation between authorities as well as new provisions to address inappropriate costs which could be charged to funds and their investors and to tackle the use of misleading names in order to increase investor protection.