Both the Alternative Investment Fund Managers Directive
(AIFMD) and the regulations of the U.S. Commodity Futures Trading Commission (CFTC) regulate hedge fund and other private fund managers. Depending on where a hedge fund manager is located and what investors it solicits, the manager may be subject to AIFMD and also required to register with the CFTC. Consequently, that manager would need to ensure that it is able to comply with both regimes. See “Participants at Eighth Annual Hedge Fund General Counsel Summit Discuss CFTC Compliance, Conflicting Regulatory Regimes and Best Marketing Practices (Part Two of Four)
” (Jan. 29, 2015). A recent program sponsored by the Futures Industry Association (FIA) provided an overview of the intersection of AIFMD and CFTC regulations, along with other regulatory issues. Michael Sorrell, an associate general counsel at the FIA, moderated the discussion, which featured Fried Frank partners Gregg Beechey, William J. Breslin and David S. Mitchell. This article, the second in a two-part series, summarizes the speakers’ key insights with respect to the intersection of CFTC regulation with AIFMD, as well as the impact on AIFMD of the U.K.’s vote to leave the E.U. The first article
addressed the current options available to U.S. managers to market their funds in the E.U. For additional insight from Fried Frank partners, see “Application to Hedge Fund Managers of the Internal Control Report Requirement of the Amended Custody Rule
” (Feb. 11, 2010); and “Hedge Fund Manager Fiduciary Duty, SEC Subpoena Power, Hybrid Hedge Fund Structures, Managed Account Platforms, Codes of Ethics and More
” (Feb. 4, 2010).