When the Door is a Wall: the Cliffwater Precedent and Its Implications for European Semi-Liquid Structures

The Cliffwater event did not expose a failure in fund design. It exposed the accountability gap that sits between the AIFM's regulatory framework and the retail investor's point of contact — across entities that were not designed to operate as a single governance system. For European ELTIF 2.0 sponsors and distributors, the question is whether that gap has been contractually documented and operationally rehearsed before the next liquidity stress event arrives.