CP12/32: Implementation of the Alternative ... - BVCA admin

Annex 5
European
Legislative Process
November 2012
CP12/32
Implementation of the Alternative Investment Fund Managers Directive
1. AIFMD is one of the first European Directives required to be wholly implemented
following the de Larosière report on financial supervision in the EU 1 and under the
macro-supervisory framework of the EU System of Financial Supervision (ESFS). Each
Member State’s transposition must take account of the Level 1 Directive, implementing
measures such as the Level 2 Regulation, mandatory and discretionary binding technical
standards, and Level 3 guidelines prepared by ESMA.
Levels of EU legislation under the Treaty of Lisbon and the Treaty on the Functioning of the EU (TFEU)
Level 1
(Legislative Acts –
e.g. Directives)
Level 2
(subordinate measures)
Framework legislation setting out the basic principles is proposed by the
Commission and adopted by the European Council and European Parliament.
AIFMD was agreed by the European Parliament and European Council in
November 2010 and was published in the Official Journal in June 2011.
An example is AIFMD.
These are delegated acts (Article 290 TFEU) or implementing acts (Article
291 TFEU) developed by the Commission on the advice of ESMA (which
itself consists of EU competent authorities). These set out the measures of
application of the Level 1 Directive. As with Level 2 measures before the
Treaty of Lisbon came into effect, the European Parliament has the power,
by simple majority, to prevent adoption of the package of measures as a
whole, while the European Council (consisting of representatives of the
finance ministries of Member States) may also block the package if it can
achieve a qualified blocking majority of votes.
An example is the Level 2 Regulation on AIFMD implementing measures.
1 Report of the High-Level Group on Financial Supervision in the EU, 25 February 2009.
Financial Services Authority A5:1