[Newsflash n. 19]

In its response to a request for clarification on investment limits of pension funds in alternative investment funds (“AIF”) – in line with a 2014 position of the Council of State on the Ministry Decree 166/2014 concerning qualitative and quantitative investment limits for pension funds – COVIP clarified that investment in AIFs is subject not only to the general quantitative limit of 30% of the total assets of the pension fund (limit that applies to investments in any kind of financial instruments not traded on regulated markets as well as in AIFs) but also to the specific limit of 20% of the overall assets of the pension fund and 25% of the aggregate value of the relevant AIF.

With its feedback, the authority does not take on board the interpretation suggested by the applicant, according to which the 30% investment limit should not apply to AIF that are traded on regulated markets. COVIP’s view is based on both the wording and the rationale of the relevant provision of law, pursuant to which AIFs are deemed to fall under the above mentioned general limit, regardless of whether or not they are traded on regulated markets, with the goal of a more pervasive mitigation of the overall risk exposure of pension funds.

Please do not hesitate to contact us should you need any further clarification on this matter.

The response, in Italian language only, is available here.

Contacts:

Vito Vittore
Senior Partner

Elena Pagnoni
Of counsel

Luigi Bonifacio
Associate