The Council of the European Union has today adopted the Alternative Investment Fund Managers (AIFM) directive, introducing harmonised EU rules for entities engaged in the management of alternative investment funds such as hedge funds and private equity firms.

Adopting the text follows an agreement reached with the European Parliament at first reading. The directive will enter into force on the 20th day following its publication in the Official Journal and member states will have two years to transpose its provisions into national law.

In a statement, the council said the directive is aimed at establishing common requirements for the authorisation and supervision of AIFM, in order to provide a coherent approach to the related risks and their impact on investors and markets in the EU.

It also aims to allow AIFM to provide services and market EU funds throughout the EU single market, subject to compliance with strict requirements.

The directive is intended to fulfil commitments made by the EU at the G-20, in the wake of the global financial crisis, as well as the European Council's pledge to regulate all players in the market that might pose a risk to financial stability.

The full text of the directive as adopted by the council can be accessed here.

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