Summary of CySEC's Circular C538
Memo #50-2022
CySEC Circular No: C538
Date: 13/12/2022
Subject: Guidance in relation to the requirement to raise capital from investors within a specified time period
Purpose: To provide guidance to AIFMs for some observations identified in relation to the requirement to raise capital from investors within a specified time period.
In Summary:
CySEC has issued the Circular C538 on 13/12/2022 to provide to the Authorised Alternative Investment Fund Managers and Sub-threshold Alternative Investment Fund Managers guidance in relation to the requirement to raise capital from investors within a specified time period.
The terms Authorised Alternative Investment Fund Managers and Sub-threshold Alternative Investment Fund Managers are explained in this Circular C538.
The articles 14(1)(a), 129(1)(a) and 136 of the Law 124(I)/2018 (‘the AIF Law’) provides for the minimum amount of capital to be raised accordingly by an AIF, an AIFLNP and a RAIF, within 12 months from the date of authorization/registration.
The minimum amount of capital to be raised within 12 months from the date of authorization/registration is €500.000 for an AIF, €250.000 for an AIFLNP and €500.000 for a RAIF.
It is noted that, when a Fund is an Umbrella fund, the requirement to raise the minimum amount of capital applies separately to each investment compartment.
With this Circular C538, CySEC provides guidance for:
• Demonstrating compliance with articles 14, 129 and 136 of the AIF Law
• Reporting to CySEC when the minimum amount of capital is raised
Also, with this Circular C538, CySEC provides guidance in relation to the event when the minimum amount of capital is not raised within the specified time period.
CySEC notes that AIFMs must make every possible effort to raise the minimum amount of capital for each Fund under their management, within the timeframe and/or deadline provided in articles 14, 129 and 136 of the AIF Law.
Read the CySEC Circular C538
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