UK Law and Practice Contributed by: Sam Kay, Philippa List, Mark Stapleton and Nicolas Kokkinos, Dechert LLP
AIF. Therefore, EU AIFs are no longer able to use UK banks as depositories post-Brexit, and UK AIFs are no longer able to use EU banks as depositaries. 2.3.3 Local Regulatory Requirements for Non- Local Managers FCA authorisation is always required to man - age a UK AIF, irrespective of the location of the manager. 2.3.4 Regulatory Approval Process Any firm applying for authorisation or registration by the FCA must have its head office in the UK. Although the FCA will judge each application on a case-by-case basis, the key issue in identify - ing the head office of a firm is the location of its central management and control. Three types of licence are available to an AIFM that has its head office in the UK: • authorisation under the Financial Services and Markets Act 2000 as amended (FSMA) as a full-scope UK AIFM; • authorisation under the FSMA as a small authorised UK AIFM; and • registration as a small registered UK AIFM. The type of licence that is available to the man - ager will depend on the total amount of assets it has under management and the nature of the AIFs managed. 2.3.5 Rules Concerning Pre-Marketing of Alternative Funds The UK has not introduced equivalent legislation to that set out in the EU’s Directive and Regula - tion on the cross-border distribution of collective investment undertakings. Although there is no formal concept of pre-marketing, any invitation or inducement to engage in investment activity
will constitute a financial promotion for the pur - poses of the UK domestic regime. Any activity that would involve pre-marketing will therefore involve the issuance of a financial promotion in the UK, and will accordingly be restricted by the UK’s financial promotion regime. A number of useful exemptions to the restric - tions on making a financial promotion are avail - able under the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the FPO), including the following in particular: • the “investment professionals” exemption, which permits financial promotions to be made to, inter alia, firms authorised by the FCA and any person whose ordinary activities involve carrying out the activity to which the communication relates; and • the “high net worth entities” exemption, which permits marketing to certain categories of high net worth institutions. Between them, these exemptions generally allow financial promotions to be made in the institutional markets. 2.3.6 Rules Concerning Marketing of Alternative Funds The activity of marketing or promoting securi - ties or other investments is not in itself a regu - lated activity requiring any form of licence in the UK. However, there are circumstances where someone whose main aim is to make promo - tions either for their own purposes or on behalf of others (or to help others to make promotions) may, in conjunction with the marketing or pro - motion, be engaged in regulated activities. In this regard, the most likely regulated activities under the Regulated Activities Order are those of “arranging deals in investments” or “advising on investments”. A firm will require authorisation,
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