On May 27, 2026, the Chamber of Deputies approved, in its third reading, an amendment to Act No. 240/2013 Coll., on Investment Companies and Investment Funds (ZISIF)[1], which constitutes the main transposition legislation for Directive (EU) 2024/927 of the European Parliament and of the Council (AIFMD II)[2]. The adopted amendment introduces the most significant changes to the regulation of alternative investment funds in more than a decade and will affect a wide range of investment companies, self-managed investment funds, and qualified investor funds.
AIFMD II amends both the AIFMD and, in certain areas, the UCITS Directive. It focuses primarily on issues related to fund liquidity management, delegation of activities, the cross-border provision of depositary services, regulatory reporting, and the granting of loans by alternative investment funds. The aim of the new regulation is to strengthen the stability of the financial system, enhance investor protection, and, at the same time, harmonize supervisory requirements across the European Union.
General Information on AIFMD II and Its Implementation in the Czech Republic
Since 2011, the AIFMD has served as the fundamental legal framework for alternative investment fund managers in the European Union. Its main objective was to establish a uniform set of rules for fund managers not covered by the UCITS regime, while also strengthening oversight of the alternative investment sector. After years of applying the original directive, the European Commission evaluated the experience gained in individual member states and identified several areas requiring further harmonization.
The Czech Republic is implementing AIFMD II primarily through an amendment to the ZISIF. At the same time, minor amendments are being made to Act No. 15/1998 Coll., on Capital Market Supervision, and Act No. 84/2024 Coll., on the Non-Performing Loan Market. Although the amendment is driven by the effort to implement AIFMD II, its content goes beyond the scope of mere transposition in some respects. In addition to the changes required by European regulations, the Act also addresses the needs of the domestic market and lessons learned from its implementation. For example, it introduces new provisions regarding the division of mutual funds, the approval process for senior management of investment companies and funds—which now aligns more closely with the regime familiar from the banking sector—and the scope of ancillary activities of investment companies.
The Directive required Member States to adopt and publish transposition regulations no later than April 16, 2026. The amendment to the ZISIF was approved by the Chamber of Deputies only after this deadline had passed and has not yet entered into force. The Czech Republic thus failed to meet its transposition obligation by the specified deadline. Although this fact does not generally impose new obligations on fund managers prior to the entry into force of the national legislation, it creates legal uncertainty and, at the same time, opens the door to potential action by the European Commission in the context of infringement proceedings against a Member State.
Liquidity Management Tools (LMTs)
One of the most significant changes introduced by AIFMD II is the harmonization of rules for managing the liquidity of open-ended funds through so-called liquidity management tools (LMTs). The purpose of the new regulations is to provide fund managers with a sufficient set of tools to enable them to respond effectively to extraordinary market situations while ensuring fair treatment of all investors.
The ZISIF amendment therefore stipulates that the manager of an open-end investment fund must implement at least two liquidity management tools from a specified list. In the case of money market funds, the implementation of at least one tool is sufficient. The specific selection must be consistent with the fund’s investment strategy, the nature of its assets, and the expected investor profile.
The exhaustive list of liquidity management tools includes:
- suspension of subscriptions, redemptions, and payouts of fund units or shares,
- redemption gates consisting of a temporary limit on the volume of redemptions,
- extension of notice periods for submitting redemption requests,
- redemption fee reflecting the liquidity costs associated with redemptions,
- swing pricing allowing for an adjustment to the net asset value to account for transaction and liquidity costs,
- dual pricing, which sets different prices for the purchase and redemption of investment instruments,
- anti-dilution levy, which protects existing investors from costs incurred by the entry or exit of other investors,
- redemption in kind through the transfer of assets instead of a cash payment,
- side pockets allowing for the separation of assets that are difficult to value or illiquid from the rest of the portfolio.
Delegation of Activities and New Disclosure Requirements
AIFMD II further clarifies the rules for the delegation of activities and strengthens oversight of outsourcing structures. The new regulations respond in particular to efforts to limit the operation of so-called letter-box entities — that is, fund managers who retain only formal responsibility for managing the fund, while a substantial portion of the activities is performed by third parties. Managers will now be subject to more extensive reporting obligations to the Czech National Bank and will have to be able to demonstrate that they retain effective management and control over the delegated activities.
Cross-Border Provision of Depository Services
One of the topics discussed during the preparation of AIFMD II was the introduction of the so-called “European passport” for depositories. The previous regulation was based on the principle that a fund’s depository must be established in the same Member State as the fund itself. Although this principle was not fully implemented in the end, the amendment to the ZISIF opens up, under certain conditions, the option provided by AIFMD II to Member States and allows foreign banks headquartered in another European Union Member State to act as depositaries, even if they do not have a branch established in the Czech Republic.
However, this option will not be available without restrictions. It will apply only to special funds and qualified investor funds, and only if it is not possible to secure appropriate depositary services through existing offerings on the Czech market. At the same time, it will be necessary to obtain the consent of the Czech National Bank.
Loan-Originating Funds and Other Significant Changes
Loan-originating funds, whose importance in the European market has grown significantly in recent years, are also facing new rules. AIFMD II introduces, for the first time ever, a uniform framework for lending by alternative investment funds. The new regulations include, for example, limits on the use of leverage, which may not exceed 175% of net asset value for open-ended funds and 300% for closed-ended funds. At the same time, the use of the “originate to distribute” model—where loans are granted primarily for the purpose of their subsequent sale—is prohibited. In cases specified by the directive, the fund will therefore be required to retain at least 5% economic interest in the loan granted even after its transfer to a third party.
The new rules also apply to risk and liquidity management. Loan-granting funds should generally be structured as closed-end funds, while the use of an open-end structure will be subject to additional requirements. The amendment to the ZISIF aligns with European regulations, particularly regarding the requirements for the management and control systems of fund managers focused on acquiring receivables from fund loans.
In addition to changes related to AIFMD II, the amendment also responds to insights gained from practical application to date. It therefore expands the scope of activities that investment companies and self-managed investment funds may perform. For example, it will now be possible to manage securitization special-purpose vehicles, carry out activities related to the management of non-performing loans, or act as a benchmark administrator in accordance with the Benchmarks Regulation.
What Should Fund Managers Do Now?
Although most of the changes resulting from AIFMD II have been anticipated for some time, their implementation will, in many cases, require more than just an update to internal documentation. Fund managers should therefore assess the impact of the amendment on their existing processes and organizational structure in a timely manner.
Particular attention should be paid to the area of liquidity management, where it will be necessary to verify whether the tools used comply with the new requirements for LMTs. At the same time, it will be advisable to review the arrangements for delegated activities and outsourcing relationships, including related documentation and control mechanisms. The changes will also affect reporting obligations to the Czech National Bank, which may require adjustments to certain internal procedures and approval processes.
Fund managers should also assess the impact of the new rules on depositary relationships and on fund structures that utilize debt financing. Last but not least, it may be advisable to assess whether the amendment presents opportunities to take advantage of newly permitted activities or to optimize existing structures. Given the breadth of the affected areas, it will be advisable to approach the implementation of the new rules comprehensively and to assess their impact on the operations of investment companies and individual funds in a timely manner.
Conclusion
AIFMD II and the related amendment to the ZISIF introduce a number of changes that will affect the operations of alternative investment funds and their managers. In addition to new rules on liquidity management, delegation of activities, and credit funds, the amendment also opens up certain new possibilities, for example in the area of depositary services or the scope of permitted activities for investment companies.
Although most of the changes will not come as a surprise to the market, their practical implications will vary on a case-by-case basis depending on the type of fund, investment strategy, and the specific structure of the fund. The true significance of some of these changes will only become clear through their practical application and the interpretation of individual provisions in the coming years.
[1] Act No. 240/2013 Coll., on Investment Companies and Investment Funds.
[2] Directive (EU) 2024/ 927 of March 13, 2024, amending Directives 2011/61/EU and 2009/65/EC as regards mandates, liquidity risk management, supervisory reporting, the provision of depositary and custody services, and the granting of credit by alternative investment funds.
Mgr. Martin Heinzel, partner – heinzel@plegal.cz
Natálie Grospičová, legal assistant – grospicova@plegal.cz
2. 7. 2026