AIFMD II has been in force since April 2026, and the picture is starting to come into focus. Most of its requirements are already in force, but the biggest operational shifts, the updated reporting regime for AIFs and a new reporting obligation for UCITS management companies have yet to take effect. ESMA's Final Report on integrated funds data collection was published in May 2026, with a consultation on the draft technical standards to follow before the April 2027 delivery deadline.
For firms with EU exposure, there's enough to work with now and a general picture to plan around. Three changes in particular are worth flagging.
AIFMD II tightens the rules on delegation to stop AIFMs operating as empty letter-box entities. The stricter requirements now apply to all functions, including ancillary top-up services, and Authorised AIFMs must have at least two full-time senior individuals domiciled in the EU. Firms will need to provide National Competent Authorities with granular delegation reporting, covering the proportion of assets delegated, the rationale for the arrangement, and the internal resources maintained to oversee delegates. For open-ended funds more broadly, AIFMD II requires enhanced liquidity management and clear disclosure to investors of which liquidity management tools are available and when they may be activated.
Private credit has grown fast, and AIFMD II now has a dedicated framework to match. An AIF is classified as loan-originating where loan origination is its primary strategy, or where originated loans make up at least half of net asset value. New leverage caps apply, with tighter limits for open-ended funds than closed-ended. AIFMs must also retain a portion of any loans they originate and later transfer. There are also concentration limits on lending to certain financial-sector borrowers, AIFs and UCITS. AIFs are prohibited from lending to their own AIFM, staff, delegates, or depositary.
The updated reporting regime is a meaningful expansion of what AIFs and AIFMs must report. The existing Annex IV reporting architecture is expected to be replaced by a new standardised reporting framework and XML schema. Firms used to report their largest exposures. Now the scope of Annex IV is expanding to cover managers' portfolios much more comprehensively. Standardised identifiers become mandatory, delegation reporting expands significantly, and firms must disclose where funds are marketed. Loan origination funds and firms using liquidity management tools face additional disclosures.
Alongside the UK's parallel reforms, this is a clear moment of divergence between the two regimes. The EU has not updated the monetary thresholds that categorise firm risk, despite inflation over the past 15 years, and the overall regulatory burden increases across the board. The UK is taking a more balanced approach, updating and restructuring its thresholds, easing the burden on smaller firms while introducing targeted new requirements on liquidity and loan origination. Both regimes are moving toward a single reporting template, but the questions and structure will differ meaningfully. Firms operating across both jurisdictions will need to plan for two separate builds.
For most firms, this remains a watching brief. The reporting technical standards are still to be finalised, but firms shouldn't wait for the details to land before taking a look at what they have. For the largest firms in particular, it is prudent to begin assessing where the required data sits today, whether it is being maintained to a suitable standard, and what your current processes look like. Getting a clear view of your data and processes now will make the eventual build a far smoother one.