FSMA Message to Investors: Certain Funds with Minimum Investment of €100,000 Are Not Subject to FSMA Supervision

rue du Congrès 12 -14 1000 Bru ssels / www.fsma.be FSMA_2025_15 of 17/11/2025 Message to investors: c ertain funds that require a minimum investment of €100,000 are not subject to FSMA supervision Scope:
Sub-threshold managers of non-public AIFs
Non-public AIFs managed by sub-threshold managers Summary/Objectives:
This communication aims to inform anyone who is considering investing in an alternative investment fund managed by a sub-threshold (small-scale) manager about the unregulated status of both the sub-threshold manager and the non-public funds they manage, and about potential risks that investing in such funds may entail. Anyone who wishes to invest in an alternative investment fund (an “AIF”) managed by a sub-threshold manager1 should bear in mind that sub-threshold managers of non-public AIFs and those AIFs themselves are unregulated entities. They are thus – with a few limited exceptions2 – not subject to any prudential rules or to supervision of compliance with such rules3 . The European legislators have indeed operated on the assumption that less protection is needed when it comes to entities and products that are not addressed to the ‘general public’ 4 . 1 Sub-threshold managers of AIFs are management companies of AIFs whose assets under management do not exceed a given threshold (see also footnote 4). The status of “sub-threshold manager” follows from European legislation (see Article 3 (2) of Directive 2011/61/EU of the European Parliament and of the Council of 8 June 2011 on alternative investment fund managers and amending directives 2003/41/EC and 2009/65/EC and regulations (EC) No 1060/2009 and (EU) No 1095/2010). 2 Namely, (i) compliance with the Anti-Money Laundering Law, (ii) a requirement to register with the FSMA (however, this is not an authorization!) and (iii) a reporting obligation to the FSMA with a view to an effective supervision of the systemic risks. 3 Analogous considerations apply, of course, if an investor comes into contact with a sub-threshold manager that is registered in another EU Member State. 4 Sub-threshold managers may have a maximum of 500 million euros in assets under management. The amount of 500 million euros is lowered to 100 million euros, however, if the manager either uses leverage financing, or allows investors to exercise redemption rights within five years of the initial investment. The sub-threshold managers may not address their offers to the general public. This means, for example, that they can only address their offers to a maximum of 149 individual investors, or that they must require a certain minimum investment amount from investors (e.g. at least 100,000 euros). Communication

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The sub-threshold manager is an unregulated entity Sub-threshold managers do not require a business authorization or licence, nor are they under the supervision of the FSMA. This means that the prudential requirements that authorized managers must fulfil do not apply to these sub-threshold managers, because the European legislators have exempted them to a significant extent from the legislation intended to protect investors by subjecting fund organization and management to certain rules. Sub-threshold managers are not bound to any legal provision regarding business management, capital and equity, organization and governance, custody of assets, remuneration, conflicts of interest and/or risk management. A sub-threshold manager of a non-public AIF that does not hold an authorization may not provide investment services5 . The MiFID conduct of business rules6 do not, in principle, apply to sub-threshold managers of non-public AIFs. The non-public AIFs managed by sub-threshold managers are unregulated funds Non-public AIFs invest in all sorts of sectors, such as real estate, shares in unlisted companies, start￾ups, technology companies, etc. A non-public AIF does not have to be registered with or authorized by the FSMA. This means that the specific rules from the AIF Law (regarding portfolio management, investment policy and transparency and advertising rules) do not apply to this type of fund. In other words, there is no legal framework for liquidity and risk management, nor with regard to diversification of the portfolio, and only a limited framework regarding transparency in this regard7 . This means, among other things, that:

• there are no requirements as regards liquidity or risk spread, nor is there any form of supervision
  of the composition of the portfolio and/or the management of such funds,
• the risks and/or costs associated with an investment might be very high,
• The special advertising rules (including the obligation to obtain prior approval of advertisements
  by the FSMA) do not apply, which means that the (potential) advantages and opportunities for profit may be given disproportionate emphasis without necessarily setting out the costs, risks and chances of loss equally clearly,
• in principle, the MiFID rules of conduct governing advertising also do not apply.
  5 Within the meaning of Article 3, 43° of the AIF Law (i.e. Individual portfolio management, investment advice and custody and administration, and/or receipt and transmission of orders). A sub-threshold manager can, however, provide services if he or she has a separate authorization in accordance with the Law of 25 October 2016. 6 These are specific rules of conduct that apply when investment services are provided by investment firms/credit institutions in respect of financial instruments. 7 When distributing products to non-professional investors, the fund developer must, however, draw up a key information document (known as the KID) before distribution in accordance with the regulations laid down in the PRIIPS Regulation. The KID must be published on the publicly accessible part of the website.

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List of sub-threshold managers
Anyone who wishes to invest in an AIF and is not sure of the status of the manager is welcome to consult the lists published by the FSMA. In those lists (availabe in French and Dutch only), there is an overview of all Belgian managers that are authorized by the FSMA (under point 1), as well as an overview of entities registered as unregulated, sub-threshold managers (under point 2). There are separate lists as well for foreign authorized managers that have registered with the FSMA (via a branch (available in French and Dutch only) or the free provision of services (availabe in French and Dutch only). Lists of public AIFs Anyone who wishes to invest in an AIF and is not sure of the public nature of the fund can consult the lists published by the FSMA (available in French and Dutch only). These lists provide an overview of all public AIFS that are registered for distribution in Belgium.