Skip to main content
Link to Walkers homepage

AIFMD II 101: Part 2 – A new EU Framework for Liquidity Management Tools

Sep 25, 2024

Advisory
A sleek black pen with 'Walkers' branding lies atop a closed notebook, both featuring raised 'Walkers' logos.

Key takeaways

  • This second instalment of our AIFMD II 101 series focuses on the new EU-wide legal framework for liquidity management tools ("LMTs") under AIFMD II.
  • The new rules in relation to the use of LMTs will apply to alternative investment fund managers ("AIFMs") of open-ended alternative investment funds ("AIFs") and undertakings for collective investment in transferable securities ("UCITS"). 
  • ESMA has also proposed detailed technical standards governing the characteristics of each of the LMTs listed in AIFMD II, as well as guidelines on the selection, calibration and activation/deactivation of such LMTs.

On 15 April 2024, Directive 2024/927/EU amending AIFMD (2011/61/EU) and the UCITS Directive (2009/65/EC), as regards delegation arrangements, liquidity risk management, supervisory reporting, the provision of depositary and custody services and loan origination by alternative investment funds ("AIFMD II") entered into force. The entry into force of AIFMD II marks a significant milestone for the European asset management industry.

Our advisory series considers a number of key changes for the asset management industry introduced by AIFMD II. The first part of our advisory series focused on the key changes for managers pursuing loan origination strategies, in light of the new harmonised framework for loan originating activities across the European Union ("EU").

In the second part of our AIFMD II advisory series we focus on the new legal framework under AIFMD II in relation to the use of liquidity management tools ("LMTs"). The new rules on LMTs apply to undertakings for collective investment in transferable securities ("UCITS") and to authorised EU alternative investment fund managers ("AIFMs") of open-ended alternative investment funds ("AIFs").  As such, all UCITS, open-ended AIFs, UCITS management companies and AIFMs will need to pay specific attention to the relevant requirements.

Please also refer to our other recent AIFMD II publications AIFMD II – A closer look and AIFMD II: Timeline to Implementation.

In this advisory we provide an overview of the new LMT requirements and their practical implications for both open-ended AIFs and UCITS funds and their fund management companies.

Read the full advisory in the second part of our series here.

Asset Management & Investment FundsIreland

Authors

Nicholas Blake-Knox

Nicholas Blake-Knox

Partner/Ireland

T/+353 1 470 6669
M/+353 87 738 2417
E/Email Nicholas Blake-Knox
More articles from this author View profile
Damien Barnaville

Damien Barnaville

Partner/Ireland

T/+353 1 863 8529
M/+353 87 970 3726
E/Email Damien Barnaville
More articles from this author View profile
Aongus McCarthy

Aongus McCarthy

Partner/Ireland

T/+353 1 470 6624
M/+353 86 136 2936
E/Email Aongus McCarthy
More articles from this author View profile
Emmet Quish

Emmet Quish

Partner/Ireland

T/+353 1 470 6652
M/+353 87 035 4749
E/Email Emmet Quish
More articles from this author View profile
Michael Dyulgerov

Michael Dyulgerov

Of Counsel/Ireland

T/+353 1 470 6683
M/+353 86 040 4092
E/Email Michael Dyulgerov
More articles from this author View profile
Jennifer Brady

Jennifer Brady

Of Counsel/Ireland

T/+353 1 470 6647
M/+353 86 041 5373
E/Email Jennifer Brady
More articles from this author View profile
Eimear O'Flynn

Eimear O'Flynn

Of Counsel/Ireland

T/+353 1 863 8516
M/+353 86 7914 354
E/Email Eimear O'Flynn
More articles from this author View profile

Claire Winrow

Of Counsel/Ireland

T/+353 1863 8539
M/+353 86 1927376
E/Email Claire Winrow
More articles from this author View profile
Joe Mitchell

Joe Mitchell

Senior Associate/Ireland

T/+353 1 470 6649
M/+353 86 605 6591
E/Email Joe Mitchell
More articles from this author View profile

Read more

AIFMD II 101: Part 1 - Loan-Origination

Get the latest insights and expertise in your inbox 

Fluid ink image
Sign up
logo footer

Connect with us

FacebookFacebook
InstagramInstagram
LinkedInLinkedIn

Employee login

Self Service Password ResetWalkers AnywhereWalkers Sharefile
Legal notices/Cookies policy

All rights reserved - © 2025 Walkers Global