GERMANY Law and Practice Contributed by: Amos Veith, Jens Steinmüller, Ronald Buge and Stephan Schade, POELLATH
2.3.9 Post-Marketing Ongoing Requirements As explained in 2.1.4 Disclosure Requirements , there are annual reporting requirements for man - agers of retail funds and managers of non-retail funds. There are also semi-annual reporting requirements for contractual funds and AG with variable capital. The reports need to be pub - lished. 2.3.10 Investor Protection Rules As explained in 2.3.1 Regulatory Regime , Ger- many recognises the concept of Special AIFs, which are AIFs whose interests or shares may only be acquired according to the fund docu - ments by professional investors within the meaning of the AIFMD or by semi-professional investors. Special AIFs themselves are either subject to a lighter regulatory regime than retail funds (in the case of fully licensed managers) or are not subject to a regulatory regime at all (in the case of a German sub-threshold manager, except for debt funds). 2.3.11 Approach of the Regulator In the authors’ experience, BaFin is generally co-operative and open to discussions. Expected timeframes can sometimes be an issue, particu - larly where BaFin is requested to answer ques - tions on new issues. BaFin regularly takes enforcement actions, with enforcement usually being a proportionate, step- by-step approach. Often, BaFin just issues a request for explanations as a warning and takes further actions only if the answers are not sat - isfactory. 2.4 Operational Requirements The investment-type restrictions for regulated general special funds translate only into assets that can be valued at fair value and risk diversi - fication. In practice, regulated special funds are
• the fund has been established (ie, first closing with investors); or • the terms of the fund are ready to be sent for acceptance to investors. Such FAQs also stipulate that reverse solicitation – ie, the approach of a manager by a German investor on its own initiative – will be permissi - ble even on the basis of general advertisement activities of such manager if unrelated to par - ticular funds. 2.3.7 Marketing of Alternative Funds AIFs can basically be marketed to retail and non-retail investors. However, alternative funds that are closed-end Special AIFs can only be marketed to professional and semi-professional investors. The EuVECA regime and the European long-term investment funds (ELTIF) regime apply to the marketing of EuVECA funds and ELTIF funds in the EU and in the EEA. 2.3.8 Marketing Authorisation/Notification Process The marketing of alternative funds requires an authorisation by BaFin or at least a European marketing passport under the AIFMD, except for marketing by German sub-threshold managers. Depending on the type of investment fund and whether retail investors are targeted, the notifi - cation process and the materials to be present - ed to BaFin vary. To the extent an EU-AIFM has notified the mar - keting of an AIF in Germany to its local regu - lator, BaFin generally only reviews whether the notification and materials provided by such local regulator are complete, and marketing may already commence when such local regulator has informed the EU-AIFM of the submission to BaFin.
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