Article 18
Due diligence
1.
AIFMs shall apply a high standard of diligence in the selection and ongoing monitoring of investments.
2.
AIFMs shall ensure that they have adequate knowledge and understanding of the assets in which the AIF is invested.
3.
AIFMs shall establish, implement and apply written policies and procedures on due diligence and implement effective arrangements for ensuring that investment decisions on behalf of the AIFs are carried out in compliance with the objectives, the investment strategy and, where applicable, the risk limits of the AIF.
4.
The policies and procedures on due diligence referred to in paragraph 3 shall be regularly reviewed and updated.
5.
AIFMs shall take into account sustainability risks when complying with the requirements set out in paragraphs 1 to 3.
6.
Where AIFMs consider principal adverse impacts of investment decisions on sustainability factors as described in Article 4(1), point (a) of Regulation (EU) 2019/2088, or as required by paragraphs 3 or 4 of Article 4 of that Regulation, those AIFMs shall take into account such principal adverse impacts when complying with the requirements set out in paragraphs 1 to 3 of this Article.