German National Private Placement Regime (NPPR) for Alternative Investment Funds (AIF)
- RA Dr. Hendrik Müller-Lankow, LL.M. (UCL)
- Jan 15
- 2 min read
Updated: May 14
The German National Private Placement Regime (hereinafter “German NPPR”) provides specific rules for foreign Alternative Investment Fund Managers ("AIFM") that intend to manage a German Alternative Investment Fund ("AIF") or to market (distribute) a foreign AIF in Germany. The scope and intensity of these requirements depend on the type of investor targeted. The regulatory burden is lowest for professional investors, intermediate for semi-professional investors, and highest for retail investors.
The applicable regime depends on whether the AIFM is domiciled inside or outside the EU/EEA.
AIFM Domiciled Within the EU/EEA
A fund manager domiciled within the European Economic Area (EEA) can make use of the European AIFMD passport regime, if it intends to market an alternative investment fund (AIF) to German professional or semi-professional investors—with the latter category being unique to German law and not derived from the AIFMD.
Marketing or selling AIFs to retail investors is permitted under the German national private placement regime, which imposes the highest regulatory standards.
The following handbook will provide you with an overview of the conditions that EU/EEA AIFMs must meet to market EU investment funds in Germany.
AIFM Domiciled Outside the EU/EEA
The third-country AIFM passport regime that is laid down in the Alternative Investment Fund Manager Directive (AIFMD) has not been enacted so far and will possibly never be enacted. This regime would allow Non-EU AIFMs established in certain Non-EU States to obtain authorisation from a EU/EEA competent authority, enabling them to manage EU AIFs or market AIFs across the EU/EEA. However, the implementation depends on a decision by the European Commission which has never been made since AIFMD stepped into force in 2011.
However, marketing or selling AIFs to German investors is permitted under the German national private placement regime. The following handbook will provide you with an overview of the conditions that Non-EU AIFMs must meet to market Non-EU investment funds in Germany.
Services of Kronsteyn
Kronstey advises on German and EU AIF and OGAW law. The range of services includes, among others, corporate, regulatory and tax law conception of AIF, preparation of sales prospectuses, supporting administrative procedures for granting a licence or notification procedures, and the conception and design of distribution structures and provision of distribution agreements.
Investment fund managers domiciled in the United Kingdom (UK) are generally permitted to market in Germany investment funds they manage.
Investment fund managers domiciled outside Germany must comply with specific regulations to market their investment fund in Germany.
