New ELTIF 2.0 regulation will facilitate retail investor access to long-term investment opportunities in Europe

The European Fund and Asset Management Association (EFAMA) welcomes the vote of the European Parliament in favor of amending the European Long-Term Investment Funds (ELTIF) Regulation, following the European Commission’s proposal in November 2021. (eventid=13321)
The ELTIF fund structure has become more appealing to asset managers and investors alike as a result of significant regulatory developments, including:
+ A greater range of acceptable assets, including the ability to invest in FinTechs, STS securitisations, and green bonds among others, as well as a more liberal definition of „real assets,“ a higher market capitalization level,;
+ The capacity to invest in fund-of-funds and master-feeder structures, use more flexible risk diversification standards, and more flexible fund rules with expanded liquidity pockets and enhanced leverage;
+ The removal of the old €10,000 entry ticket, the elimination of the minimum net worth criterion, and the harmonization of the distribution regime through the alignment of the ELTIF suitability test with MiFID II all contribute to better access and safer conditions for retail investors.
Under the ELTIF 2.0 regulation, existing ELTIFs that were launched under the current regime will still be considered compliant for a period of five years after ELTIF 2.0 comes into effect. ELTIFs that were authorized under the current regime can choose to switch to the new regime by notifying their national competent authority.