Reverse solicitation and Marketing of Alternative Investment Fund shares

New guidance provided by the Commission de Surveillance du Secteur Financier (CSSF)

Marketing for alternative investment fund shares under the AIFMD means a direct or indirect offering or placement of shares/units in an AIF made by the AIFM, or an intermediary acting on his behalf, managed by or with investors who are either domiciled in the European union or they have an EU registered office.

Reverse solicitation, also called "passive marketing", refers to activities that are generally not considered as marketing under the AIFMD and to which the AIFMD marketing requirements do not apply.



Providing draft documents is not considered as marketing because the prospective investor cannot use such documents, in relation to an AIF, to formally subscribe to, or commit to subscribe to, shares or units of the AIF.

The AIFM is permitted to present AIF-related documents to prospective investors prior to informing the CSSF provided investors do not formally invest in or commit to subscribing until the CSSF has been informed.

"Marketing" activity may be carried out in various forms (advertising, distribution of AIF documents to prospective investors, road shows, distance marketing) provided that the relevant material delivered to investors can be used to "formally subscribe or commit to subscribe" to shares or units of the AIF.


Distance marketing

'Distance marketing' in Luxembourg refers to marketing activity carried out by any means of communication (telephone, emails, website, etc.). Such activity does not need simultaneous physical presence in Luxembourg of representatives of i) the AIF, the AIFM, or an intermediary, and ii) the investor. However, the marketing activity itself must be performed on Luxembourg territory and potential investors must be either domiciled in Luxembourg or have their registered offices in Luxembourg. All relevant marketing materials must offer the opportunity to subscribe for shares or units of the AIF.


Reverse solicitation

Reverse solicitation consists of providing information regarding an AIF and making units or shares of that AIF available for purchase by a potential investor. This follows enquiry by the investor (or an agent of the investor) made without any solicitation by the AIF or its AIFM (or an intermediary acting on their behalf) in relation to the relevant fund.

Reverse solicitation is not considered to be 'marketing' under the AIFMD if the following elements are met:

  • the investor or agent has approached the AIFM or the AIF on its own initiative, with the intention of investing in (or initially in receiving information regarding) AIF(s) managed by such AIFM;

  • neither the AIFM, nor the AIF (nor any intermediary acting on their behalf) has solicited the investor to invest in the relevant AIF.


The AIFM has the burden of proof with respect to the two criteria above. Evidence can include written confirmation by the investor of its decision to invest on its own initiative or, initially, requesting information regarding the relevant AIF(s).


Non-marketing activities

  • investments made in AIFs in the context of a discretionary mandate for the management of individual portfolios (initiated by the investment manager) - vis-à-vis the investment manager and its client

  • proposal to invest in an AIF in the context of an investment advisory agreement (initiated by the advisor) - vis-à-vis the advisor and its client

  • investments in targeted AIFs made in the context of collective portfolio management of an AIF (initiated by an AIF or its management company, AIFM, portfolio manager, or other agent) - vis-à-vis the AIF and the portfolio manager

  • secondary trading of units or shares of an AIF is not considered 'marketing' unless there is an indirect offering or placement through one or more intermediaries acting at the behest  or on behalf of the AIFM or the AIF.

(Source CSSF)

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