Notified Professional Investor Funds (‘NPIFs’) – The Introduction of A New Fund Regime

Authors: Kurt Hyzler & Jessica Agius

On the 18^th December 2023, the Malta Financial Services Authority (‘MFSA’) issued a new framework applicable and specific to NPIFs. This framework introduces NPIFs into the local fund sector.  A NPIF is a type of Collective Investment Scheme which is exempt from licensing under the Investment Services Act, but which is to be notified to the MFSA for its inclusion in the List of NPIFs maintained by the MFSA, in terms of Regulation 17 of S.L. 370.34 – the Investment Services Act (Notified CISs) Regulations.

This new fund regime is based on the Notified Alternative Investment Funds (‘NAIFs’) framework in place, and as such, it is envisaged, that this new fund structure would:

1. be quicker to set up – within a maximum of 10 working days from the submission of a complete notification pack to the MFSA; and
2. attract lower associated setup and other operational and regulatory costs than those which are currently experienced in operating a fully licensed fund.

NPIFs may not be self-managed and must be managed by:

(a) locally licensed de minimis AIFMs;

(b) EU/EEA de minimis AIFMs; and

(c) third country AIFMs which are authorised in a jurisdiction with whom the MFSA has signed a bilateral cooperation agreement/ MoU and which the MFSA deems to be subject to regulation in an equal or comparable level to that which it would have been subject to in Malta.

Feel free to get in touch with us should you require further information on the NPIF regime or other fund licenses available in Malta.