AIFMD II in Ireland: what changed for Fund Selectors
6 AUG, 2026
Ireland has completed its transposition of AIFMD II, closing out one of the most significant regulatory overhauls the Irish funds industry has seen in over a decade. Between May and July 2026, the Central Bank of Ireland (CBI) rewrote both the AIF Rulebook and the domestic UCITS Regulations to reflect the new EU rules. For fund selectors tracking Ireland as a domicile, here is what actually changed, what's still contested, and what still lies ahead.
A two-stage transposition, now complete
AIFMD II (Directive (EU) 2024/927) entered into force at EU level in April 2024, with member states given until 16 April 2026 to transpose it into national law. Ireland's implementing legislation, S.I. No. 181 of 2026 and S.I. No. 182 of 2026, came into operation on 1 May 2026, a short delay past the EU deadline.
Days later, on 5 May 2026, the CBI published its revised AIF Rulebook alongside a Feedback Statement on Consultation Paper 162. The UCITS side followed on 10 July 2026, when the CBI finalised new Central Bank UCITS Regulations under Consultation Paper 161, replacing the 2019 rulebook entirely.
What changed for AIFs and QIAIFs
The revised AIF Rulebook removes the restriction that previously stopped AIFs from granting loans or acting as guarantors for third parties. The standalone loan-originating QIAIF ("L-QIAIF") chapter has been scrapped altogether, with loan origination now governed directly by the AIFMD II framework as transposed into Irish law.
Non-EU AIFMs are, for now, restricted to closed-ended loan-originating QIAIFs, pending ESMA's draft technical standards for open-ended structures. The rulebook also introduces revised performance fee verification procedures, extending sign-off beyond the depositary, and adds new stress-testing requirements for money market RIAIFs.
What changed for UCITS
The new Central Bank UCITS Regulations align the domestic framework with AIFMD II by requiring UCITS management companies to select from a prescribed menu of liquidity management tools, under the LMT Regulatory Technical Standards that ESMA published in the Official Journal on 27 February 2026. Following ESMA's recommendation, at least one anti-dilution tool and one quantitative LMT should be considered, though the CBI has kept this as guidance rather than a strict mandate.
Performance fee rules were also updated, with the CBI's new Guidance on Performance Fees for UCITS and RIAIFs introducing a revised crystallisation frequency requirement and closer alignment with ESMA's own performance fee guidelines.
Key dates at a glance
| Date | Instrument | What it did |
|---|---|---|
| 1 May 2026 | S.I. No. 181 & 182 of 2026 | Transposed AIFMD II and UCITS VI into Irish law |
| 5 May 2026 | Revised AIF Rulebook (CP162) | Liberalised loan origination; removed the L-QIAIF chapter and guarantee restriction |
| 10 July 2026 | Central Bank UCITS Regulations (CP161) | Replaced the 2019 UCITS rulebook; mandatory LMT selection; new performance fee guidance |
| 16 April 2027 | Enhanced reporting obligations | Expanded AIFMD II/UCITS regulatory reporting takes effect |
Source: Central Bank of Ireland, AIF Rulebook (5 May 2026); Irish Statute Book, S.I. No. 181 of 2026; Department of Finance, Funds Sector 2030 Final Report (2025).
What could complicate the picture
Not every account of this transposition reads as a clean win. Industry commentary in Funds Europe has described AIFMD II's changes as pragmatic rather than transformative, noting that the delegation model — the point EU policymakers debated hardest — emerged largely intact. The more consequential shift is concentrated in loan origination.
On that front, there is a real compliance trap: the CBI has confirmed no grandfathering applies to AIFMs already originating loans under general permissions. Any manager that didn't secure a variation of permission before the rules took effect is technically out of line, regardless of how long it has operated the strategy. Separately, delays to some Level 2 technical standards mean AIFMs are still operating with gaps in the detail for certain provisions, which several advisers flagged as a source of interim uncertainty rather than a settled framework.
What's still to come
The expanded regulatory reporting requirements only take effect from 16 April 2027, giving fund management companies roughly a year of runway. Firms that have updated prospectuses and constitutional documents for the May and July changes will still need to revisit reporting templates and systems before that deadline.
Why it matters for fund selectors
For fund selectors, the practical takeaway is that Irish-domiciled AIFs, particularly QIAIFs used for private credit and private asset strategies, now have more structuring flexibility than before, while UCITS funds gain a harmonised, EU-wide approach to liquidity management. The reforms were shaped partly by the Department of Finance's Funds Sector 2030 Final Report, which pushed the CBI to make Ireland more competitive for private assets, ETFs, and retail investment products.
The timing is notable: Ireland holds the Presidency of the Council of the EU in the second half of 2026, and the Irish Funds Annual Global Funds Conference takes place in Dublin on 1 October 2026, where the industry is expected to take stock of how the new rulebook is working in practice.
What fund managers should check now
- Loan-origination permissions: confirm the AIFM has a formal variation of permission on file, not just a general permission covering the activity.
- Review whether existing QIAIF documentation still references the removed L-QIAIF chapter or the old third-party guarantee restriction.
- Check UCITS prospectuses reflect the new mandatory LMT menu, even where the specific tool combination remains a CBI recommendation rather than a requirement.
- Flag internally that expanded reporting obligations, due 16 April 2027, will likely require systems and template work well before that date.
Frequently asked questions
When did AIFMD II actually take effect in Ireland?
The implementing regulations came into operation on 1 May 2026, with the CBI's revised AIF Rulebook following on 5 May 2026 and the domestic UCITS Regulations on 10 July 2026.
What's the biggest change for QIAIFs?
The removal of the loan-origination restriction and the dedicated L-QIAIF chapter, meaning QIAIFs now originate loans directly under the AIFMD II framework rather than a separate Irish-specific regime.
Do UCITS funds have to adopt liquidity management tools?
Selection from the prescribed menu is mandatory, but the CBI has kept the choice of specific tools, such as combining an anti-dilution tool with a quantitative LMT, as a recommendation rather than a hard requirement.
Is there a grace period for AIFMs that were already originating loans?
No. The CBI has confirmed no grandfathering applies, so any AIFM originating loans without the correct variation of permission is out of line regardless of how long it has run the strategy.
What deadline should fund selectors watch next?
16 April 2027, when the expanded AIFMD II and UCITS regulatory reporting obligations become mandatory for Irish-domiciled funds and their managers.
Looking ahead
Ireland's AIFMD II transposition was never just a compliance exercise. By pairing the EU-mandated changes with domestic reforms recommended in the Funds Sector 2030 review, the CBI has tried to use the deadline as an opportunity to modernise a rulebook that, in the AIF space, had barely changed since 2013.
For fund selectors evaluating Irish structures against alternatives like Luxembourg, the direction of travel is clear: more flexibility for private asset strategies, a harmonised liquidity toolkit for UCITS, no grandfathering for firms that lag on authorisation, and one more reporting deadline still to come in April 2027.
This article is for informational purposes only and does not constitute investment, legal, or regulatory advice. Fund managers should seek independent advice on their specific authorisation and compliance position.
