Further to our post in June, the European Commission (Commission) has commenced its review of the regulatory framework of the European Long Term Investment Fund (ELTIF) by launching its inception impact assessment. The assessment outlines the likely economic, social, environmental, and administrative impacts of overhauling the ELTIF framework, with a view to adopting a revamped regime in Q3 2021.

As part of its review, the Commission will focus on the following key issues:

  • Removing limitations on the supply side: for example, by clarifying the category of eligible assets investments and modifying borrowing limits; and
  • Reducing the demand side barriers to investment: for example, by clarifying requirements for appropriateness and lowering the minimum entry requirements.

The inception impact assessment is open to feedback for four weeks until 14 October 2020.

Macfarlanes will maintain its involvement with the Alternative Credit Council’s ELTIF working group and monitor the developments of the Commission’s review closely to ensure that any legislative changes lead to material improvement in the ELTIF framework.