Qualified Investor Alternative Investment Fund Overview

The QIAIF meets the requirements of AIFMD and acts as the vehicle of choice for private investors who choose to invest in real estate or alternative asset classes.  QIAIFs are only available to select investors who have extensive knowledge of the financial industry or possess specific certifications.

The QIAIF is an attractive option for hedge funds and funds of hedge funds that may not fit into a UCITS structure.  The requirements for liquidity, diversification, restrictions on borrowing and leverage, applicable to a UCITS fund do not apply to a QIAIF.  A QIAIF is attractive because it allows the investment manager a high degree of flexibility within the management strategy.

What does a QIAIF do?

• A QIAIF allows for pooling of assets.
• A QIAIF may invest up to 100% of its assets in unregulated schemes, subject to a maximum of 50% in any one unregulated scheme.
• The range of eligible assets for a QIAIF is very flexible.
• Quarterly liquidity is typically provided to investors (where redemptions are less than quarterly, the QIAIF is a limited liquidity fund).
• A QIAIF is the preferred structure for use in the regulated alternative investment area because it is exempt from the general conditions relating to retail investment policies and borrowing restrictions.
• No investment restrictions are imposed by the Central Bank of Ireland (or by the Irish Stock Exchange, if the QIAIF is listed on the ISE).
• There is no requirement to distribute income, and accordingly, funds can be established either as distributing funds or accumulating funds.

Regulatory Requirements

Regulated by the Central Bank of Ireland, the QIAIF must designate an AIFM, which will be regulated under the AIFMD. QIAIFs are subject to fast-track authorization which allows the fund to be authorized by the Central Bank of Ireland within 24 hours.

There is no requirement to publicise the issue and redemption prices of their units; however, these must be made available to unit holders on request. There are no diversification requirements.