Feeder AIF meaning

In fund structuring, a feeder AIF is an alternative investment fund set up to channel investors’ capital into a separate “master” AIF rather than investing directly. The term is defined in legislation: Article 4(1)(m) of the AIFMD (retained EU law in the UK and implemented in Ireland). A feeder AIF is an AIF that: (i) invests at least 85% of its assets in units or shares of a master aif; (ii) invests at least 85% of its assets in more than one master AIF with identical investment strategies; or (iii) otherwise has an exposure of at least 85% of its assets to such a master AIF. In practice, identifying a fund as a feeder AIF determines application of the AIFMD master–feeder regime, including additional disclosure, reporting and operational requirements for the AIFM, depositary and auditor, and specific approvals/notifications to the FCA (UK) or the Central Bank of Ireland. Usage is consistent across England & Wales, Scotland, Northern Ireland and Ireland. In the UK, the definition is onshored via the Alternative Investment Fund Managers Regulations 2013 and the FCA Handbook; in Ireland it is implemented by the European Union (Alternative Investment Fund Managers) Regulations 2013 and the Central Bank’s AIF Rulebook. Post‑Brexit, marketing...