Central Bank of Ireland Opens ELTIFs Consultation
By: Gayle Bowen and Shane Geraghty
On 1 November 2023, the Central Bank of Ireland, published its European Long Term Investment Fund (ELTIF) consultation paper (the “CP”) which is now open for industry feedback for an expedited six week period until 13 December 2023. The CP relates to the proposed standalone ELTIF chapter set to be introduced into the Central Bank’s Alternative Investment Fund Rulebook, which will facilitate ELTIFs becoming a standalone regulated product in Ireland as discussed in our previous blog here.
The proposed ELTIF chapter of the AIF Rulebook will set out the operational mechanics for Irish ELTIFs. From a regulatory standpoint, it is worth noting that the Central Bank has not sought to goldplate the Irish ELTIF regime and instead has relied on the text from the ELTIF Regulations. The Central Bank is seeking to ensure that the revised AIF Rulebook will be in place before year end to coincide with the expected introduction of the updated ELTIF Regulations on 10 January 2024 which will establish a strong regulatory framework for ELTIFs in Ireland.
Concurrently, the European Securities and Markets Authority is due to publish its final report following its consultation on proposed Level 2 SFDR Regulatory Technical Standards (the “RTS”) which includes certain technical standards on the updated ELTIF Regulations. The RTS will specify, inter alia, how the new requirements on the ELTIF’s redemption policy and a matching mechanism for transfer of units between existing and potential investors will work, and will focus mainly on the liquidity profile and the matching procedures of these products. At European level it has been speculated that there may be delays in finalising this report by the 10 January deadline which may cause delays to the introduction of ELTIF 2.0. However, all indications at a national level are that Ireland will be ready for ELTIF 2.0 by 10 January 2024.