Substantial relaxation of Irish private assets fund rules now effective

The Central Bank of Ireland is enhancing and simplifying Ireland's private assets funds offering following the publication of the updated Alternative Investment Fund Managers Directive (AIFMD) Q&A.

The Irish private assets and alternatives funds offering is poised for further growth following the introduction of these much-anticipated regulatory enhancements on 7 March 2025. 

The enhancements introduce very welcome additional flexibility, enabling alternative investment funds (AIFs) to guarantee third party debts. Helpful clarifications to certain CBI rules applicable to loan origination funds have also now been made. 

These updates simplify private assets fund rules and enhance the attractiveness of Ireland as a key global hub for private assets funds, signalling a promising new chapter for the industry. Ogier's Investment Funds partner Oisin McClenaghan was actively involved in industry engagement leading to the delivery of these positive changes through his work with the Irish Funds Private Assets Working Group.

Central Bank of Ireland's updated AIFMD Q&A

The updated AIFMD Q&A includes three new clarificatory questions and answers, each addressing CBI AIF Rulebook provisions that have historically presented certain compliance challenges for private assets funds and their managers. 

Qualifying Investor AIFs (QIAIFs) can now act as guarantors for and provide security to third parties

Historically, AIFs were prohibited from acting as guarantors for third parties. This prohibition frequently generated additional complexity for AIFs and their managers when AIFs were seeking to be party to multi-vehicle fund structure credit facilities. This complexity has now been removed. 

AIFs are now permitted to provide guarantees or other forms of security in respect of investments and / or intermediate vehicles, subject to certain requirements being met.

AIFMD II loan originating-AIF alignment

The final updated AIFMD Q&As are addressed as loan-originating funds in Ireland (L-QIAIFs) and provide welcome clarification pending the expected replacement in full of the current CBI L-QIAIFs requirements, with the loan-originating fund requirements of AIFMD II by April 2026 at the latest.

Next steps

The CBI is expected to commence a consultation process on proposed updates to its AIF Rulebook shortly, in preparation for the implementation of AIFMD II by the April 2026 European deadline. 

The issue of the updated AIFMD Q&As is a welcome development. The CBI is demonstrating its commitment to the streamlining and simplification of its regulatory requirements, steps which will contribute meaningfully to Ireland's thriving private assets and alternatives servicing offering.

How Ogier can help

With a team of experienced investment fund, structured finance, fund finance, and banking and finance experts in Ireland, Ogier is well-placed to provide seamless cross-border legal expertise to managers and institutional investors in Europe and North America.

Key contacts in our Investment Funds, Banking & Finance and Structured Finance teams in Dublin are listed below for questions in relation to this update or other related matters.

About Ogier

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Disclaimer

This client briefing has been prepared for clients and professional associates of Ogier. The information and expressions of opinion which it contains are not intended to be a comprehensive study or to provide legal advice and should not be treated as a substitute for specific advice concerning individual situations.

Regulatory information can be found under Legal Notice