The Alternative Investment Fund Managers Directive (AIFMD) passport allows fund managers to market and manage EU alternative investment funds (AIFs) freely across the EU, without having to register in each country.
The passport is currently only available to EU fund managers. Non-EU AIF managers, and EU AIF managers marketing non-EU AIFS, have to register in each country.
When the AIFMD was set up, it included a process for extending the passport to non-EU countries, ESMA said.
ESMA has now published advice and an opinion on extending the passport, which will be considered by the European Commission, European Parliament and Council of Ministers.
ESMA looked at six jurisdictions: Guernsey, Hong Kong, Jersey, Singapore, Switzerland and the US. In its advice, it said that there are no obstacles to extending the passport to Guernsey and Jersey, and that Switzerland plans to remove remaining obstacles with pending legislation.
"No definitive view" has yet been reached on the other three jurisdictions, due to concerns about competition, regulatory issues and a lack of sufficient evidence, but ESMA said it will make recommendations as soon as it can.
Further non-EU countries will also be assessed in future, it said, including Australia, Bahamas, Bermuda, Brazil, British Virgin Islands, Canada, Cayman Islands, Curacao, Guernsey, Hong Kong, Isle of Man, Japan, Jersey, Mexico, Mauritius, Singapore, South Africa, South Korea, Switzerland, Thailand, United States of America, and the US Virgin Islands.
ESMA was established in 2011 to protect investors and promote stable, well-functioning financial markets in the EU, it said.