Alternative Investment Fund Managers (AIFM) Directive

The European Union is currently considering a draft Directive, known as the Alternative Investment Fund Managers (AIFM) Directive. The Directive was produced in response to the recent financial crisis, and is intended to introduce additional controls over funds which might cause excessive risk to the financial system. However all investment trusts, including Alliance Trust, would also be subject to the Directive.

Alliance Trust is opposed to the Directive as currently drafted for the following reasons:

In principle – investment trusts do not cause systemic risk, on the contrary they offer retail investors access to markets with greater diversification and lower risk than they could achieve by direct investment.

In relation to regulatory overlap – Alliance Trust is already subject to regulation as a listed company whose shares are traded on the London Stock Exchange. The new Directive would introduce additional, overlapping and inconsistent requirements.

On practical issues – various requirements within the Directive are inconsistent with the way investment trusts operate, and others would create additional cost with no obvious benefit for investors.

If you would like more information, please read our more detailed note

For an update on the progress of the Directive, please read our latest update
IF THE DIRECTIVE IS PASSED IN ITS CURRENT FORM IT WILL REDUCE CHOICE AND INCREASE COSTS FOR INVESTORS WITHOUT ANY INCREASE IN INVESTOR PROTECTION.