The European Commission has submitted a proposal for a regulation concerning a new private investment fund frame in the form of European Long-Term Investment Funds (ELTIFs). The framework is intended for investors who desire to invest in companies and projects on a long-term basis.
The ELTIFs could be offered to all types of investors across Europe, subject to certain requirements, and are only permitted to invest in certain defined types of long-term illiquid assets and businesses. ELTIF managers would need to comply with the rules of risk spreading and provide appropriate protection for investors in terms of the Alternative Investment Fund Managers Directive, as well as make available to investors certain stipulated information.
Firms need to be optimistic that the money invested in them will be committed for the period disclosed to the investors upfront. Thus it will only be possible for investors to withdraw money upon the specified end date of their investment.
