Raymond Frenken

In comparison to some other European countries, including Luxembourg and Germany, investors in the Netherlands appear hesitant to embrace the new generation of Eltif funds at the moment. Questions to private banks and wealth managers in the Netherlands reveal a restrained level of enthusiasm.

Imagine a groundbreaking European savings and investment product, open to all 450 million individuals across the European Union, supported by a harmonised tax incentive endorsed by every EU member state. Wishful thinking? Probably so, but maybe not.

Although fundamentals remain weak and carbon prices are half of what they were a year ago, market participants said a fresh round of global tensions could drive up natural gas prices and potentially trigger a short squeeze in the carbon market.

Protracted discussions over the EU’s new regime for European Long Term Investment Funds, known as Eltifs, are delaying the launch of new funds for these private asset investments.

Switzerland is preparing to step up competition with Luxembourg as a fund domicile for alternative investment funds. The industry, however, is not convinced that the Swiss alternative can fully match the international success of Luxembourg Raifs.

From next month, the Swiss will allow management companies to create a new type of fund known as L-QIF that will compete with the successful regime for Reserved Alternative Investment Funds, or Raifs, first made possible in the Grand Duchy in 2016.

Berlin-based Moonfare said it plans to create a dedicated secondary liquidity mechanism that enables retail investors in Eltif 2.0 funds to unwind their holdings before the fund matures.

As the global investment community grapples with a fluctuating market and evolving attitudes towards ESG (Environmental, Social, and Governance) funds, a nuanced story is emerging from Europe. This narrative, against the backdrop of Amundi’s “Responsible Investment Views 2024” report and innovative steps by Mirova and Robeco, is further illuminated by Morningstar’s latest findings on global sustainable fund flows.

The European Commission is contemplating an alternative route towards a swift adoption the EU’s regulatory and technical standards for the forthcoming generation of European Long-Term Investment Funds under the new Eltif 2.0 regulation.

Europe’s biggest asset manager Amundi calls on its peers in financial sector to better serve clients by stepping up efforts to bring greater clarity on the use of standards and regulations that govern responsible and sustainable investing. 

A data analysis by Investment Officer makes clear that alternative investment fund managers in Luxembourg increasingly prioritise launching new sub-funds or compartments under established Reserved Alternative Investment Funds, known as Raifs, instead of launching new primary structures.