German National Private Placement Regime (NPPR) for Non-EU Alternative Investment Funds (AIF)
Updated: Jan 27
The German National Private Placement Regime (hereinafter “German NPPR”) provides specific rules for Alternative Investment Fund Managers that are not domiciled in an EU/EEA state ("Non-EU AIFM") and 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 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.
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.
Kronstey advises on German fund and asset management law and fund distribution 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.
Originating loans in Germany generally requires a BaFin license, if the foreign investment manager cannot rely on a specific exemption.