For each EU AIF they manage and each AIF they market in the EU, AIFMs should also disclose:

• The portfolio composition of originated loans.

• On an annual basis, all direct and indirect fees and charges directly or indirectly charged to the AIF. The European Parliament draft report does not refer to any of the AIF’s investments, in contrast to the Commission proposal. These are positive amendments as the widening proposed by the Commission proposal appears to be relatively burdensome and not particularly relevant.
• On an annual basis, any parent company, subsidiary or special purpose entity established in relation to the AIF’s investments by the AIFM. The EU Parliament Report restricts such disclosure to the AIFM, whereas the Commission proposal includes the parent company, the subsidiary or special purpose entity established by the staff of the AIFM or its direct or indirect affiliates.

The other significant change is the frequency of the disclosure, set as annually in the European Parliament draft report.

Reporting regarding markets and instruments which the AIFM trades on behalf of the AIF (no longer only the principal markets and instruments, as modified in the Commission proposal) is complemented by other relevant economic and accounting information from the following list:

• The total amount of leverage within the AIF’s net assets employed by the AIF.
• Information regarding delegation arrangements regarding portfolio management or risk management functions, and in particular:
  • information on entities to which such functions have been delegated (name and LEI of each delegate, its jurisdiction of establishment and, where relevant, its supervisory authority.
  • information on the function delegated, the type of delegation (full or partial), and the date of the delegation agreement or contract.
  • where sub-delegation arrangements are in place, the same information in respect of the sub-delegates and the functions sub-delegated.
  • the date of conclusion and expiration of the delegation and sub-delegation arrangements.
  • a description of the periodic due diligence measures carried out by the AIFM to oversee, monitor and supervise the delegate, including the date of performance of those measures, the issues identified and, where relevant, the measures and timeline adopted to address those issues. There is no reference to other economic and accounting information in the Commission proposal.

Access the draft report of 16 May 2022 from the European Parliament here.