Eltif 2.0

Luxembourg may be leading the charge in Eltif launches under the revised framework, but elsewhere in the Benelux they are proving a tougher nut to crack.

The European Long-Term Investment Fund (Eltif) regime is entering a new phase, driven by a surge in local fund launches and rising domestic demand across Europe.

ESMA has asked the European Commission to clarify Eltif 2.0 implementation rules, as inconsistent supervision across member states risks delaying investor access to semi-liquid private market funds.

Institutional investors remain wary of semi-liquid private funds, a sentiment that was on full display at this year’s Luxembourg Meeting for Private Markets Investments, a German-language private markets conference known as Lumpi.

Efama chief Tanguy van de Werve highlights the urgent need for tax harmonisation to overcome fragmentation and create a competitive, unified European market.

Martin Groos unpacks the journey of the European Long-Term Investment Fund (Eltif) since its promising launch in 2015, and explores whether recent reforms under “Eltif 2.0” will finally deliver success.

With the European Commission confirming on Tuesday that the Level 2 Regulatory Technical Standards (RTS) for the revised European Long-Term Investment Funds (Eltifs) regime are on track, the alternatives industry is shifting its focus towards overcoming operation challenges such as on co-investments, liquidity management and handling different tax regimes across the EU market.

The Luxembourg Stock Exchange is exploring ways to create public listings of European Long-Term Investment Funds, private market vehicles that for now are the exclusive domain of high-net worth individuals. A senior official said the bourse, also known as LuxSE, sees a particular role for itself when it comes to enhancing the exit opportunities.

Euroclear, the Brussels-based securities custodian and settlement giant, has taken a significant step forward in the private markets space by securing a partnership with BlackRock, the world’s largest asset manager.

The revamped Eltif 2.0 framework, effective since January, is breathing new life into the sector, with Luxembourg playing a central role in this expansion of the market for European Long-Term Investment Funds.