Before the E.U.’s Alternative Investment Fund Managers Directive (AIFMD) was adopted in 2013, the E.U.’s private funds sector was largely unregulated and unsupervised. In response, AIFMD introduced standards across the E.U. around raising private capital, risk monitoring, reporting obligations, remuneration policies and overall accountability. With an extraterritorial reach, AIFMD has been the most significant piece of regulation affecting the private funds industry worldwide since its enactment. Instead of regulating private funds, the E.U. decided to regulate the managers of such private funds, which resulted in bringing any private fund managed by E.U. asset managers or marketed to E.U. investors within the scope of AIFMD. In the same vein, the SEC recently adopted finalized private fund rules (Private Fund Rules) to regulate U.S. private fund advisers and update the compliance rules applicable to those advisers. In a guest article, Nadia Bonnet, Luxembourg senior counsel at Simpson Thacher, aims to help fund managers chart a path toward complying with both regulatory frameworks by comparing the quarterly statement rule, audit rule and preferential treatment rule in the SEC’s Private Fund Rules to their counterparts under the AIFMD framework. Fund managers can significantly streamline their compliance and reporting obligations by complying with the highest applicable standard between the two frameworks. See our two-part series on AIFMD 2.0: “Updated Rules on Delegation, Annex I Services and Liquidity Management Tools” (Nov. 30, 2023); and “New Loan Origination Standards, Undisrupted Marketing Practices and Surprising Omissions” (Dec. 14, 2023).