Draft amendments to the German Investment Act

摘要

Purpose – The purpose of this paper is to summarize recent draft amendments to the German Investment Act as reflected in the second Draft dated 2 April 2007. Design/methodology/approach – The paper summarizes proposed changes in regulations for investment companies and product-related changes in the German Investment Act. Findings – The paper finds that proposed changes for investment companies include investment companies losing their status as credit institutions, a requirement for an independent director on a supervisory board, a reduction in initial capital requirements, a cancellation of certain reporting obligations, an acceleration of the approval process for fund rules, a shortening of the publication process for fund rule changes, and clarification of the distinction between public distributions and private placements. Product-related changes include modified provisions on redemption obligations and value determination as well as a requirement to maintain adequate risk management systems for open-ended real estate funds; liberalized provisions for special funds; the introduction of infrastructure funds; and the introduction of “other funds.” A comprehensive revision of provisions for investment stock corporations is also proposed. Originality/value – A clear, concise summary of proposed amendments to the German Investment Act by a lawyer who specializes in the field, useful for German investment company compliance officers as well as compliance officers in other countries looking for an introduction to German investment company regulations.