The new Capital Investment Code (KAGB), which went into force on 22 July 2013, aims at a comprehensive regulation of all types of investment assets and their managers. The new Code goes significantly beyond the previously applicable limits of the Investment Act (InvG).

The innovations imply significant effects for investment practices, since all closed-end funds that started their activity after 22 July 2013 or want to start activity in the future are subject to legal supervision and regulation for the first time.
Upon expiration of the one-year transitional period on 7/21/2014, moreover, closed-end funds already existing prior to 7/22/2013 must also comply with the new requirements of the KAGB when they invest in new assets or even just comprehensively restructure or repair their portfolio.
However, closed-end funds are not the only investment vehicles facing the new challenges. Even a year after the KAGB became effective, many market players are uncertain whether they are subject to the law, and if so, which precise requirements and duties they must comply with. This particularly includes what are known as family & friends programs, GmbH & Co KG structures (limited partnerships where the general partner is a limited-liability company), real estate AGs, REITs, cooperatives and other investment vehicles that are based on a common investment. Even family offices may be affected by the new regulations in individual cases, specifically when the degree of relatedness of the family members involved is too distant in the view of the regulators.
In addition, a practitioner commentary has been published in German by C.H. Beck Verlag with the title “KAGB - Kommentar zum Kapitalanlagegesetzbuch und zur Verordnung über Europäische Risikokapitalfonds mit Bezügen zum AIFM-StAnpG” edited by Weitnauer/Boxberger/Anders. It has been available since mid-August 2014 at bookstores or can be ordered online.
Our real estate experts Dr. Daniel Kautenburger-Behr and Henning-Günther Wind are co-authors of the book. They comment on the area of master feeder structures and real estate special funds.
Additional information and ordering opportunities can be found here.