A US manager raising money in Europe has two things to solve. Most advice covers only the first.
The fund. Can this fund be offered to investors in Germany, France, the Nordics, wherever you are going? This runs through each country's private placement rules or through a European fund manager structure. Your administrator and your fund counsel handle it, and they handle it well.
The distribution team. The regulatory position of the person or company conducting investor discussions must be assessed separately from the fund’s marketing permissions. A tied agent carries out the agreed activities on behalf of and under the responsibility of an authorised investment firm, without obtaining its own investment-firm authorisation for those activities. Registration, competence and applicable notification requirements still apply. Under substnz’s model, the proposed tied agent must be established in Germany or another EEA country. A company established only in the US cannot itself take that role.
What works instead is a person or a company established in Germany or another EEA country, appointed by a licensed European investment firm.
Legal basis: Article 29(3) MiFID II for where a tied agent is registered. § 3 Abs. 2 and § 70 WpIG for who substnz can appoint. AIFMD and national private placement rules for the fund.
Offering an alternative fund to professional investors in Europe needs a route in each target country: national private placement rules where they exist, or a structure involving a licensed European manager.
This page does not go deep on that, because it is well covered elsewhere and because substnz is not a fund manager.
One point does carry over. Appointing someone else to market your fund does not move your own duties to them. That is a reason to care whether they are properly licensed.
Bringing investors and funds together is a licensed activity in Europe. If your European fundraising is done by people rather than by a signed distribution agreement, somebody has to hold that licence for the work they do.
Three structures come up again and again.
This does not work with substnz. A tied agent goes into the register of the European country where it is established, and the German rules substnz works within provide a route for agents established in Germany or another European Economic Area country only. A US company is neither. US ownership of an EEA company is not itself disqualifying; the test is where the proposed agent is established and whether it has real substance.
Whether and how a firm from outside Europe may provide investment services into a European country is decided country by country, and the answers differ. This is the arrangement most often assumed rather than checked.
This works under substnz’s model. An individual living in a European Economic Area country, or a company established there with real substance, is appointed by a licensed European investment firm, registered where they are established, and works under that firm's responsibility. How many registrations you need depends on where your people sit.
This is a simplified comparison for readers coming from the US. It is meant to place the European concepts against terms you already use. The two systems are not equivalent and the comparisons do not carry across as a matter of law.
If a decision turns on any of these points, check the European position itself rather than the comparison.
Europe's pre-marketing rules, which let a manager test investor appetite before the fund is cleared, apply to licensed European managers. Non-EU AIFMs do not have an EU-wide pre-marketing entitlement under Article 30a.
Individual countries may provide their own route, and some do, including Luxembourg. That has to be checked country by country. Do not plan a European campaign assuming the European pre-marketing rules apply to you.
That depends on the law in each country you are calling into, and your fund's marketing route does not answer it. It is the assumption that most often turns out to be wrong. Where the team is in the US and the outreach is systematic, the practical answer in most European markets is that you need a European arrangement.
Not necessarily. An individual living in a European Economic Area country can be appointed as a tied agent directly. A company established in the EEA is the other route and makes sense if you want a team rather than one person, but it has to have real substance behind it.
Only if the people raising the money are employed by that manager and work inside its licence. If your fundraising team sits in your US company or in a separate entity, the manager's licence does not stretch to them.
The US entity cannot, under substnz’s model. A person or company established in Germany or another EEA country and connected to it can, and that is the structure to design towards. Whether the specific people you have in mind qualify gets checked before anything is filed.
substnz Capital Partners GmbH is an investment firm supervised by BaFin, the German regulator. It appoints tied agents to bring professional and institutional investors and funds together across eighteen European markets.
For a US manager or sponsor, that means the Europe based people who raise your money can work under our licence and our supervision. It does not extend to your US entity or to staff sitting in the US, and it does not replace your fund's route to market.