A Welcome Development for Life Settlement QIAIFs

PUBLISHED: 14th September 2022

In a welcome move, the Central Bank of Ireland (“CBI”) has simplified the authorisation requirements for Qualifying Investor Alternative Investment Funds (“QIAIFs”).

It invest in life settlements by confirming that pre-submissions are no longer required in connection with their applications for authorisation. 

These QIAIFs are once again included in the categories of QIAIFs that may avail of the CBI’s 24-hour fast-track authorisation process (“Fast-Track Authorisation Process”). 

Fast-Track Authorisation Process for QIAIFs

A QIAIF is an alternative investment fund (“AIF”) authorised by the CBI, under the European Union (Alternative Investment Fund Managers) Regulations 2013 and its AIF rulebook, marketed to professional investors and other high net worth individuals and catering to the widest range of investment strategies in a robustly regulated environment. 

The success of the QIAIF regime has been reliant on its speed to market due to the Fast-Track Authorisation Process, which was introduced in 2007 to facilitate the authorisation of QIAIFs within a 24-hour period by the CBI. 

In 2020, however, the CBI introduced a pre-submission process for certain types of QIAIFs, including life settlement QIAIFs.

The requirements of the pre-submission regime allows the CBI to raise queries and request additional information. Only once this process has completed and the application is cleared of comment may the QIAIF proceed to the Fast-Track Authorisation Process.

For those QIAIFs required to make a pre-submission, this process results in longer launch timeframes and diminishes the key advantage of establishing QIAIFs in Ireland via the Fast-Track Process. 

Pre-Submissions No Longer Required for Life Settlement QIAIFs

On 1 July 2022, the CBI updated the guidance on its website (here) regarding the pre-submission process. One of the key changes is that this process is now only required for QIAIFs investing in global crypto assets or property assets situated in Ireland. 

A pre-submission is not required for QIAIFs investing in any other asset classes and life settlement QIAIFs can once again avail of the Fast-Track Process. This is a positive reflection of the quality of submissions made in connection with life settlement QIAIFs and industry’s engagement with the CBI.

Benefits for Life Settlement QIAIFs

Life settlement QIAIFs are now authorised by the CBI within 24 hours of submission of a complete application including certifications from the proposed legal adviser, alternative investment fund manager and depositary. If submitted by 5 p.m. on a business day, the QIAIF is authorised by the CBI on the following business day.

This encouraging development demonstrates the CBI’s openness to its authorisation of life settlement QIAIFs and is of significant benefit to promoters due to the resultant predictability and speed to market. This considerably enhances the attractiveness of establishing these structures in Ireland. 

The CBI will carry out periodic quality assurance reviews of authorised QIAIFs and may in the future update the list of QIAIFs on its website that are required to make a pre-submission. Managers of life settlement QIAIFs should continue to ensure that submissions are of a high quality and to engage positively with the CBI, were deem necessary.