According to the objective of the AIFMD to promote fair treatment of AIF investors, ESMA shall, by 18 months from entry into force of the AIFMD 2, submit a report on undue costs charged by AIFMs to investors in AIFs:

• assessing the costs charged by AIFMs to investors in AIFs, and the reasons for cost levels and differences between them;
• proposing criteria for assessing whether the level of such costs is or is not appropriate, in particular when compared to the level of costs in other jurisdictions worldwide;
• proposing, if necessary, options for action by competent authorities or by legislators in respect of inappropriate or undue levels of such costs.

Regarding the reporting obligations to NCAs, the information regarding delegation arrangements concerning portfolio management or risk management functions shall be reported for each AIF managed or marketed in the Union by an authorized AIFM.

The EU Parliament final report adds a recital relating to the remuneration policies of AIFMs which shall be consistent with long-term risks, including ESG risks and sustainability goals, in particular where AIFMs make claims as to the sustainable investment policies of AIFs they manage.

Access the European Parliament Final Report of 2 February 2023 here.