The European Securities and Markets Authority (“ESMA”) has approved the co-operation arrangements between the Brazilian Comissão de Valores Mobiliários (“CVM”) and the EU securities regulators for the supervision of alternative investment funds, including hedge funds, private equity and real estate funds. ESMA has negotiated the agreement with the CVM on behalf of all 27 EU national competent authorities for securities markets regulation.
The co-operation arrangements include the exchange of information, cross-border on-site visits and mutual assistance in the enforcement of the respective supervisory laws. This co-operation will apply to Brazilian Alternative Investment Fund Managers (AIFMs) that manage or market Alternative Investment Funds (AIFs) in the EU and to EU AIFMs that manage or market AIFs in Brazil.
The content of the Memorandum of Understanding follows the IOSCO Principles on Cross- Border Supervisory Co-operation of 2010, and complements the terms and conditions of the IOSCO Multilateral MoU Concerning Consultation and Co-operation and the Exchange of Information of 2002.
A similar co-operation agreement with the Swiss Financial Market Supervisory Authority FINMA had already been approved by ESMA. ESMA is currently in contact with other non-EU authorities that are members of IOSCO and is continuing to negotiate co-operation arrangements with the relevant authorities with a view to having these in place before July 2013, that is, before the implementation by all EU Member States of the Alternative Investment Fund Managers Directive (“AIFMD”). According to the AIFMD, the fund industry from a non-EU country whose securities regulator does not have such co-operation arrangements in place by July 2013 will not be permitted to offer or manage AIFs in the EU.