UK FCA Overhauls AIFM Rules, Cuts Reporting Burden

Britain’s alternative investment fund manager regime is largely inherited from the EU’s Alternative Investment Fund Managers Directive and retained after Brexit. The framework has become fragmented, while size thresholds have failed to keep pace with industry growth. UK managers oversee nearly £2 trillion in alternative assets and more than £16 trillion overall, making proportionate supervision important to competitiveness as well as investor protection and market integrity.

The Financial Conduct Authority and HM Treasury unveiled parallel reform proposals on July 14. The FCA’s Fund Reporting for Asset Management Entities, or FRAME, would consolidate existing filings and replace the Annex IV-based system, with reporting obligations scaled to risk and reductions of as much as 75% for smaller managers. The broader package is expected to save asset managers £128 million annually and introduce small, medium and large supervisory tiers. FRAME comments close Sept. 22, the AIFM consultation ends Oct. 14, and full implementation is targeted for 2028.