USA – NEW YORK Trends and Developments Contributed by: Aaron Bourke, Tom Scriven, Bjorn Sorenson and Joshua Teitelbaum, RPCK Rastegar Panchal
The year ahead will likely bring continued use of GP- led liquidity solutions, broader adoption of evergreen models, expansion of private credit platforms, and fur - ther integration of blended approaches. At the same time, regulatory oversight will remain active, requir - ing managers to integrate compliance into structural innovation. New York Practice While these trends are shaping the private funds landscape nationally and globally, New York remains a uniquely influential jurisdiction, particularly as a hub for innovation in alternative fund structures and for financing arrangements governed by New York law. Although Delaware remains the dominant jurisdiction for US private fund formation and the governing law for fund documents, New York continues to play a central role in the structuring and operation of pri - vate funds, particularly in the alternative space. Most fund-level credit agreements and subscription facili - ties are governed by New York law, making New York the de facto standard for enforcement of financing arrangements and contractual covenants. Side letters, however, are generally governed by the same law as the limited partnership agreement, most often Dela - ware. New York’s usury statutes (civil cap of 16% and criminal cap of 25%) are an important consideration in the design of private credit and blended finance structures, particularly where higher-yield instruments are contemplated.
Fund managers must also navigate New York’s broad - er fiduciary and anti-fraud regime. Unlike Delaware, which permits fiduciary duties to be contractually modified or waived, New York common law contin - ues to recognise expansive fiduciary obligations in certain investment relationships. In addition, the New York Attorney General wields broad investigatory and enforcement authority under the Martin Act, which can extend to the marketing and sale of fund interests, even in exempt offerings. Finally, New York serves as a key anchor for emerging managers and blended finance initiatives. The New York State Common Retirement Fund and the New York City Retirement Systems operate robust emerg - ing manager programmes, while public-private financ - ing models such as the Rikers Island social impact bond and the New York Green Bank have established the state as a proving ground for innovative structures. For many market participants, New York remains not only the established financial market of choice but also a laboratory for the evolution of alternative invest- ment strategies.
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