TRW & Co · Funds & Financial Services
Asset Management Lawyers in London
Asset management lawyers London managers instruct advise on authorisation, fund structuring, mandates, distribution and regulatory change. With the FCA consulting on a new three-tier AIFM regime, a new retail disclosure regime arriving in 2027 and sustainability rules now in force, 2026 is a year for managers to plan rather than react.
Key pointThe FCA's proposed AIFM regime will sort managers into small, medium and large tiers by net asset value, so managers should model their tier now rather than wait for final rules expected ahead of a 2028 start.
At a glance
New AIFM regime
FCA CP26/28, published 14 July 2026, proposes a three-tier AIFM structure and a new ALTS sourcebook, with implementation envisaged for 2028.
Retail disclosure overhaul
The consumer composite investments regime replaces PRIIPs and UCITS disclosure, with the new regime fully in force from 8 June 2027.
Reserved Investor Fund
A new unauthorised contractual scheme for professional investors has been available since March 2025, aimed particularly at real estate.
Stewardship Code 2026
The FRC's revised UK Stewardship Code took effect on 1 January 2026 with a lighter reporting approach for signatories.
Anti-greenwashing rule
All FCA-authorised firms must ensure sustainability claims are fair, clear and not misleading, with naming rules for retail products.
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What asset management lawyers London managers instruct actually do
Asset management lawyers London managers, investors and boards instruct deal with the rules that govern running other people's money. That covers how a manager is authorised and governed, how its funds and mandates are structured, how products are distributed and disclosed, and how the firm responds when the FCA, an investor or a counterparty raises concerns. The work spans traditional fund houses, alternative managers, wealth and discretionary managers, family offices and new entrants building their first regulated platform.
Asset management in the UK is going through its biggest rule rewrite since the EU directives were adopted. The FCA is redesigning the regime for alternative investment fund managers, replacing retail product disclosure rules with a new consumer composite investments regime, and reviewing remuneration, reporting and liquidity rules. At the same time, the Consumer Duty, the sustainability disclosure regime and the Senior Managers and Certification Regime (SMCR) continue to shape day-to-day compliance.
The legal questions usually arise at specific moments: setting up a new manager or fund, launching a product for retail investors, entering a new market, taking on a delegated mandate, buying or selling a manager, or handling a complaint, breach or investigation. Asset management lawyers London firms rely on should give answers that work commercially, not only on paper.
The legal and regulatory framework
The foundation is the Financial Services and Markets Act 2000 (FSMA). Managing investments, managing an alternative investment fund (AIF), managing a UK UCITS and acting as depositary are regulated activities requiring FCA permission. The Financial Services and Markets Act 2023 is moving much retained EU law out of legislation and into FCA rules, which is why so many asset management rules are now being consulted on.
Key rulebooks and legislation
- Alternative investment fund managers. The Alternative Investment Fund Managers Regulations 2013 and the FCA's Investment Funds sourcebook (FUND) implement the UK version of AIFMD, including the distinction between full-scope and small AIFMs and the national private placement regime for marketing.
- Authorised funds. The FCA's Collective Investment Schemes sourcebook (COLL) governs UK UCITS, non-UCITS retail schemes, qualified investor schemes and long-term asset funds, including the annual assessment of value.
- Prudential rules. Most solo-regulated asset managers are MIFIDPRU investment firms under the Investment Firms Prudential Regime, with capital, liquidity, ICARA and remuneration requirements.
- Conduct. The Consumer Duty applies to retail products and services, including fund value assessments, communications and the distribution chain. The financial promotion rules apply to marketing.
- People. The Senior Managers and Certification Regime applies to most asset managers, assigning prescribed responsibilities and personal accountability.
- Sustainability. The Sustainability Disclosure Requirements (SDR) include an anti-greenwashing rule for all authorised firms, naming and marketing rules for retail products using sustainability terms, and voluntary investment labels.
- Stewardship. The Financial Reporting Council's UK Stewardship Code 2026 took effect on 1 January 2026, with a streamlined reporting approach for signatories.
Scotland and Northern Ireland are covered by the same FSMA regime, although Scottish limited partnerships, which are often used in fund structures, have their own partnership law and recent transparency reforms.
What is changing in 2026 and beyond
Asset management lawyers London managers work with are spending much of 2026 on reform. The main workstreams are:
| Reform | What it does | Status (as at October 2026) |
|---|---|---|
| New UK AIFM regime (FCA CP26/28 and HM Treasury legislation) | Replaces the full-scope and small AIFM split with a three-tier small, medium and large structure based on net asset value; consolidates rules in a new Alternative Investment Funds sourcebook (ALTS) | Consultation opened 14 July 2026, with the deadline for the main paper extended to 22 October 2026; implementation currently envisaged for 2028 |
| Fund Reporting for Asset Management Entities (FRAME) and remuneration reform | Proposes simplified fund reporting and changes to solo-regulated firms' remuneration rules | Consulted on alongside CP26/28 (CP26/26 and CP26/27) |
| Consumer composite investments (CCI) | Replaces PRIIPs and UCITS disclosure with a more flexible UK product information regime for retail investment products | Final rules in PS25/20; legislation commenced 6 April 2026; new regime fully in force from 8 June 2027 |
| Reserved Investor Fund | New unauthorised contractual scheme for professional and institutional investors, aimed particularly at real estate | Regulations made in February 2025 and in force since March 2025 |
| UK Stewardship Code 2026 | Revised principles and lighter reporting for asset managers and owners | In effect from 1 January 2026 |
| Carried interest tax | Moves carried interest into a revised income tax framework | New regime from April 2026; individual positions need specialist tax advice |
Other live FCA workstreams also affect managers. The FCA has consulted on strengthening liquidity risk management for UCITS and non-UCITS retail schemes, with clearer board-level accountability, and on fair redemption terms for authorised funds investing in less liquid assets. It has also consulted on changes to client categorisation, including a new route for wealthy individuals to be treated as elective professional clients, which would affect who private fund managers can market to and on what terms. These proposals may change before final rules are made, so managers should track them rather than implement early.
Managers should model where they will fall under the new AIFM tiers and how authorisation, reporting, valuation, delegation and investor disclosure will change. Our article on AIFM regime reform tracks the detail as it develops.
Structuring managers, funds and mandates
The manager
New managers must decide whether to seek their own FCA authorisation, operate as an appointed representative of a regulatory host, or use a third-party AIFM or authorised fund manager. Each option involves trade-offs between speed, cost, control and investor perception. Institutional investors increasingly expect managers of significant size to hold their own permissions, and the AIFM reforms will change the regulatory burden at each size band. Our FCA authorisation team runs applications and variations of permission.
The fund vehicle
The right vehicle depends on investors, assets, tax and distribution. English limited partnerships and private fund limited partnerships remain common for closed-ended private funds. Open-ended investment companies and authorised unit trusts suit retail and wealth distribution. The long-term asset fund is designed for illiquid assets. The Reserved Investor Fund adds an unauthorised contractual option for professional investors. Offshore vehicles in Luxembourg, Ireland, the Channel Islands or Cayman are still used where investor base or marketing requires them, and our investment funds team structures each of these.
Segregated mandates and delegation
Investment management agreements for pension schemes, insurers and wealth clients need clear investment restrictions, liability caps, best execution and reporting obligations. Delegation arrangements between AIFMs, authorised fund managers and sub-advisers must meet the regulators' substance and oversight expectations, which the FCA is proposing to simplify through a post-notification model for AIFM delegation.
Launching a fund or product: the process
The steps below assume an FCA-authorised manager launching a new fund. Timing depends heavily on the vehicle and whether FCA authorisation of the fund itself is needed.
- Define investors and distribution. Identify whether the product is for professional, high net worth, sophisticated or retail investors, which countries it will be marketed in, and through which platforms or distributors.
- Choose the vehicle and service providers. Select the legal form, depositary or custodian, administrator, auditor and, where needed, a third-party AIFM. Confirm tax treatment for the vehicle and investors.
- Confirm permissions and governance. Check the manager's permissions cover the product. Update SMCR responsibility maps, conflicts policies and product governance records.
- Draft the documents. Prospectus or private placement memorandum, constitutional documents, limited partnership agreement or instrument, subscription documents, side letters, investment management and delegation agreements.
- Retail and sustainability checks. For retail products, complete Consumer Duty target market and fair value work, product disclosure under the CCI transition, and SDR naming and marketing checks if sustainability terms are used.
- Regulatory filings. Apply for fund authorisation where needed, or notify the FCA under the relevant AIFM or private placement procedure. Overseas marketing requires local filings.
- Launch and first close. Complete investor onboarding, anti-money laundering checks and capital calls or dealing, and confirm all disclosures match the final terms.
Documents and evidence to keep in order
- Regulatory business plan, permissions and SMCR documentation, including statements of responsibilities.
- Fund documents, side letters and a most-favoured-nation register showing what each investor was offered.
- Investment management, delegation, distribution and administration agreements, with oversight records.
- Product governance and Consumer Duty fair value assessments, plus annual assessment of value reports for authorised funds.
- Valuation, liquidity management and conflicts policies, with evidence of how they were applied in practice.
- Marketing materials, financial promotion approvals and records of SDR-related claims.
- Breach logs, complaints records and notifications to the FCA.
Regulators and investors increasingly test what a manager actually did, not just what its policies say. Keep contemporaneous records of valuation committee decisions, liquidity reviews, conflicts management and fair value assessments. In a dispute or an FCA review, those records usually decide the outcome.
Risks and common mistakes
These are the issues asset management lawyers London managers consult most often run into.
Marketing before the regulatory groundwork is complete
Communicating with prospective investors about a fund can amount to marketing or a financial promotion. If it happens before the right notification, private placement filing or exemption is in place, the manager may breach FSMA or overseas rules, and investors may later have rescission or damages arguments. Pre-marketing should be planned with clear scripts and records, and overseas marketing checked with local counsel for each country.
Side letters that conflict with fund documents
Side letters often grant fee discounts, information rights, co-investment rights or excuse rights. Without central tracking, they can conflict with each other, with the fund's terms or with the manager's fair treatment obligations. Managers should keep a register, run most-favoured-nation elections carefully and make sure disclosures about preferential treatment are accurate.
Using sustainability terms without the evidence to support them
The anti-greenwashing rule applies to all sustainability-related claims by authorised firms, and the SDR naming and marketing rules restrict sustainability terms in retail product names unless the product meets the requirements. Claims in factsheets, websites and social media are all in scope. Managers should review existing products, keep evidence for each claim, and align marketing with the product's actual investment policy.
Treating the assessment of value as a box-ticking exercise
Authorised fund managers must assess annually whether their funds provide value, and the Consumer Duty adds a broader fair value outcome for retail products. The FCA has criticised reports that rely on generic statements or fail to act on poor performance or high charges. Boards should challenge the analysis, consider share class and fee changes, and document what they decided and why.
Under-resourcing delegation oversight
Delegating portfolio management, distribution or administration does not delegate responsibility. The FCA expects managers to oversee delegates with real information, to be able to replace them, and not to become letter-box entities. Weak oversight is a frequent finding in supervisory reviews and can lead to enforcement where investors suffer harm. Contracts should give the manager the information and termination rights it needs.
The asset management rulebook is being rewritten, but the regulator's core question has not changed: can this firm show that it acts in its investors' interests, and can it prove it?
Supervision, investigations and investor disputes
Most regulatory contact for asset managers comes through supervision rather than enforcement. The FCA uses portfolio letters, multi-firm reviews, data requests under section 165 of FSMA and, where it has concerns, skilled person reviews under section 166. Recent supervisory themes for asset managers have included liquidity management in funds holding less liquid assets, valuation of private assets, conflicts of interest, assessment of value and the treatment of retail investors under the Consumer Duty.
How a manager responds to early supervisory contact often decides whether a matter escalates. Accurate, complete and timely answers, an honest account of any weaknesses and a credible remediation plan are usually more effective than a defensive response. Firms also have a continuing duty under Principle 11 to tell the FCA about anything it would reasonably expect notice of, which can include significant breaches, operational failures and investor harm.
Investor claims
Disputes with investors tend to arise from performance losses combined with an allegation that the manager breached the investment restrictions, misdescribed the strategy or risks, mishandled a valuation, or failed to manage a conflict. The outcome usually turns on the precise wording of the investment management agreement or fund documents, any exclusion or limitation of liability, and what the manager's records show about its decisions at the time. Retail investors may also complain to the Financial Ombudsman Service, and section 138D of FSMA gives private persons a statutory right of action for certain rule breaches.
Asset management lawyers London managers appoint for these matters should be involved before positions harden. Early analysis of the documents and records can show whether a claim should be resisted, settled or resolved through a remediation exercise.
Cross-border distribution and Bangladesh, EU, Gulf and Asian investors
Since Brexit, UK managers no longer have EU passports. Marketing AIFs into EU member states depends on each country's national private placement regime, now shaped by the EU's AIFMD II amendments, while UK UCITS cannot be marketed to EU retail investors under the UCITS passport. Many managers therefore use EU vehicles or management companies, with UK delegation. Inbound, the Overseas Funds Regime provides a route for recognised overseas funds to be marketed to UK retail investors.
Gulf sovereign and family investors often invest through London managers and want Shariah-compliant share classes or feeder structures, which our Islamic finance team can document. Singapore's variable capital company and the DIFC and ADGM fund regimes provide alternatives for Asian and Gulf platforms.
For Bangladesh, mutual funds and alternative investment funds are regulated by the Bangladesh Securities and Exchange Commission, and outward investment by Bangladeshi residents is subject to foreign exchange controls. UK managers seeking Bangladeshi investors, and Bangladeshi groups appointing London managers, need coordinated advice. TRW & Co's Dhaka practice advises on the Bangladeshi side, and our investing in Bangladesh team covers inbound strategies.
How TRW & Co's asset management lawyers London team helps
TRW & Co's London office is authorised and regulated by the Solicitors Regulation Authority. We advise managers, investors, boards and service providers on regulatory, transactional and contentious asset management matters.
Manager set-up and permissions
We advise on authorisation, appointed representative and host arrangements, variations of permission, SMCR documentation and change in control filings.
Fund structuring and launch
We structure and document private and authorised funds, including limited partnerships, OEICs, long-term asset funds and Reserved Investor Funds, with tax advisers.
Regulatory change projects
We run gap analyses and implementation plans for the new AIFM regime, CCI disclosure, SDR, the Stewardship Code 2026 and remuneration and reporting reform.
Mandates and distribution
We negotiate investment management, sub-advisory, distribution and platform agreements, and advise on financial promotions and overseas marketing.
Manager M&A and GP stakes
We act on acquisitions, minority stakes and restructurings of asset managers, including regulatory approvals, with our private equity colleagues.
Investigations and disputes
We respond to FCA supervisory reviews, skilled person reviews and investigations with our FCA enforcement team, and advise on investor claims.
Asset management lawyers London firms need often work across disciplines, so we coordinate with our financial services regulation team. See the full range of our work on our practices page.
Checklist for asset management decision-makers
- Do our permissions, SMCR maps and governance match what the firm actually does today?
- Where will we sit under the proposed small, medium and large AIFM tiers, and what will change for us?
- Is our retail product disclosure plan ready for the CCI regime's full application in June 2027?
- Are all sustainability-related names and claims supported by evidence and consistent with SDR?
- Do our assessment of value and Consumer Duty fair value work lead to real decisions?
- Is delegation oversight documented, with the information and termination rights we need?
- Is every overseas marketing activity covered by the right local filing or exemption?
- Do we have a central register of side letters and investor commitments?
To speak with asset management lawyers London managers can rely on, contact TRW & Co at info@trw.co or +880 1779 127165, or visit Holborn Gate, 330 High Holborn, London WC1V 7QH.
Frequently asked questions
01Do I need FCA authorisation to manage a fund in the UK?
Usually, yes. Managing an AIF, managing a UK UCITS and managing investments are regulated activities under FSMA, so a manager must either be authorised with the right permissions, act as an appointed representative of an authorised firm where that model is available, or appoint a third-party authorised manager. The right route depends on the fund, the investors and how much control the manager wants over the regulated functions.
02What is changing in the UK AIFM regime?
In July 2026 the FCA published CP26/28, proposing to replace the current full-scope and small AIFM categories with small, medium and large tiers based on net asset value, and to consolidate rules in a new Alternative Investment Funds sourcebook. HM Treasury is consulting on the underlying legislation. The FCA intends to publish final rules and a further consultation, and the implementation date currently envisaged is 2028.
03What is the consumer composite investments regime?
It is the FCA's replacement for the PRIIPs key information document and UCITS key investor information document for UK retail investment products. Final rules were published in PS25/20 in December 2025. The legislation commenced on 6 April 2026 and the new regime is fully in force from 8 June 2027. It gives manufacturers more flexibility in how product information is presented, within the Consumer Duty framework.
04Can a UK manager market funds to EU investors?
Not with a passport since Brexit. UK managers can market AIFs to professional investors in EU member states that operate national private placement regimes, subject to each country's rules and the EU's AIFMD II amendments. Retail marketing in the EU is far more restricted. Many UK managers use EU-domiciled funds and management companies with portfolio management delegated back to London.
05Do the sustainability disclosure rules apply to every fund manager?
The anti-greenwashing rule applies to all FCA-authorised firms making sustainability-related claims. The naming and marketing rules apply where retail products use sustainability-related terms, and investment labels are voluntary. Larger asset managers also have entity and product-level climate-related disclosure obligations. Managers should map which rules apply to each product and keep evidence supporting every claim.
06What is the Reserved Investor Fund?
The Reserved Investor Fund is an unauthorised contractual scheme introduced by regulations made in February 2025. It is intended for professional and institutional investors and is aimed in particular at real estate investment, offering a UK-based alternative to some offshore vehicles. Eligibility, tax treatment and investor restrictions should be checked before choosing it.
07Can TRW & Co help Bangladeshi investors use London managers?
Yes. We advise Bangladeshi groups and family offices on appointing London managers, investing in UK and offshore funds, and negotiating investment management agreements and side letters. Outward investment from Bangladesh is subject to foreign exchange controls and other local rules, so we coordinate with TRW & Co's Dhaka practice on the Bangladeshi requirements before investments are made.
Sources and official materials
- FCA CP26/28: The UK AIFM Regime — Proposed three-tier AIFM regime and ALTS sourcebook
- FCA PS25/20: Final rules for Consumer Composite Investments — New retail product information regime
- Alternative Investment Fund Managers Regulations 2013 — UK implementation of AIFMD
- Reserved Investor Fund Regulations 2025 — New unauthorised contractual scheme
- FCA: Sustainability Disclosure Requirements regime — Anti-greenwashing, naming, marketing and labels
- FRC: UK Stewardship Code — Stewardship Code 2026, effective 1 January 2026
- FCA Handbook: COLL — Rules for authorised funds
General information only, current as at 21 October 2026. It is not legal advice and does not create a solicitor–client relationship. It reflects the law of England and Wales unless stated otherwise; Scotland and Northern Ireland have separate legal systems, and the law changes frequently. Check current official sources and take advice on the facts of your matter.