GLOBAL – The European Securities and Markets Authority (ESMA) has agreed the terms of its joint regulation of alternative funds with almost three dozen non-European regulators, coming as part of the implementation of the Alternative Investment Fund Managers Directive (AIFMD).

ESMA said the co-operation agreements, negotiated on behalf of regulators in Croatia and the 30 countries within the European Economic Area (EEA), were in fact only bilateral agreements, and that individual regulators would therefore need to sign up to the terms with the 34 non-European bodies involved.

Steven Maijoor, chairman at ESMA, said the agreements marked a "significant step" towards implementing the AIFMD ahead of the July deadline.

"The agreements set high standards for co-operation on the supervision of cross-border alternative funds, thereby strengthening investor protection and the global consistency of supervision," he said.

The memoranda of understanding address the co-operative regulation of alternative investment funds in Australia, Canada, Hong Kong, Singapore and the US, among others, and will allow for regulators to share information across borders.

The regulator added that the memoranda were a pre-condition for non-EU alternative investment funds to access the single market.

The announcement comes a week after ESMA published its final guidelines on concepts within the directive, addressing concerns from the real estate industry that the legislation provided an unclear definition of pooled returns within funds – as it did not specify what differentiated pooled returns from absolute returns.

ESMA responded by noting that a pooled return was the return "generated by the pooled risk arising from acquiring, holding or selling investment assets", including all activities undertaken by a manager to "optimise" the value of any holdings.

The regulator estimated that the directive would impact 1,122 real estate funds, with assets of around €258bn, excluding any UCITS vehicles.