On 31 October 2018, HM Treasury published draft versions of the Venture Capital Funds (Amendment) (EU Exit) Regulations 2018 and the Social Entrepreneurship Funds (Amendment) (EU Exit) Regulations 2018. HM Treasury has also published a draft explanatory memorandum covering these draft Regulations plus the draft Long-term Investment Funds (Amendment) (EU Exit) Regulations 2018.
These draft Regulations are part of a series of draft statutory instruments for investment funds and their managers. The other draft Regulations being:
- the Alternative Investment Fund Managers (Amendment) (EU Exit) Regulations 2018; and
- the Collective Investment Schemes (Amendment etc.) (EU Exit) Regulations 2018.
Together the draft Regulations form part of a series of draft statutory instruments that HM Treasury is publishing as part of its contingency planning for a no-deal Brexit. The statutory instruments are made by HM Treasury in exercise of its powers conferred by the European Union (Withdrawal) Act 2018.
Among other things the three draft Regulations mentioned in the first paragraph above maintain the existing investment rules for European venture capital funds (EuVECA), European social entrepreneurship funds (EuSEFs) and European long term investment funds (ELTIFs) domiciled in the UK.
The Alternative Investment Fund Managers (Amendment) (EU Exit) Regulations 2018 sets out the design and structure for a temporary permissions regime for all EEA alternative investment funds, including EuVECAs, EuSEFs and ELTIFs. It also deals with the temporary marketing regime.