Last Friday, November 29, 2013, the German legislator eventually agreed on the Act Amending the German Investment Tax Act and Other Acts (AIFM Tax Amendment Act, or “GITA–AIFM“). A period of unease and uncertainty for German investors in foreign investment funds has thus come to an end as the German Investment Tax Act (“GITA“) scope was hanging in limbo after the German legislator, during the last legislative period, failed to base the scope of application of the GITA on the new German Investment Code (Kapitalanlagegesetzbuch or “KAGB“), which implemented the European Alternative Investment Fund Managers Directive (“AIFMD”) into domestic law, and thereby repealed the German Investment Act as of July 22, 2013 (see beleuchtet, dated September 5, 2013).

The German insurance supervisory authority published two guidance papers on October 22 and 23, 2013. The first guidance paper allows for an increase of forward purchases of fixed income instruments. The second one modifies and amends the guidance paper on use of external ratings and internal credit risk assessments initially published on June 28, 2013.

The JOBS Act has lifted the ban on fund managers from public advertising. At the same time, fund managers now engaging in general solicitation may find themselves running afoul of a EU directive, the Alternative Investment Fund Managers Directive (the “AIFMD”). Fund managers are well advised to tread carefully and to take active steps now in order to avoid triggering the AIFMD and its transparency, reporting and disclosure obligations vis-à-vis EU regulators.