A survey has estimated the draft European alternative investment fund managers directive would cost the industry well over £1bn.
The survey of hedge fund managers and private equity managers by think tank Open Europe found most UK-based hedge fund managers estimated the one-off restructuring cost for implementing the directive at around £423 (EU488). That figure rose to £508 (EU586) for managers elsewhere in Europe.
Hedge fund managers also said there would be annual recurring costs of between £150 and £184 once the directive was implemented.
A total of 121 hedge funds and fund of hedge fund (FoHF) managers from across the world contributed to the survey, representing EU342 billion assets under management (AUM).
Though the directive aims to benefit investors and regulate the industry more tightly, only 2 of fund managers said their clients had viewed the draft favourably.
Almost half (46%) said clients were not in favour, with the same number saying clients were indifferent.
An overwhelming majority of hedge fund managers (over 82%) said they thought the directive would not reduce risk and market volatility.
Meanwhile less than a quarter (23%) of respondents said the directive would prompt them to move their funds onshore.
A larger proportion (27%) said they would be less likely to move onshore.
Nearly three-quarters (73%) of EU-based managers thought it would be difficult to launch UCITS-regulated funds.
Open Europe said implementation of the directive without substantial changes could cost Europe billions of euros in tax revenues each year.
It recommended that the directive should differentiate between types of funds, bring its organisation requirements in line with existing EU law, free up investor choice by dropping clauses such as the requirement for reciprocal agreements with non-EU countries, and scrap restrictions on specific investment policies.
The directive is currently being scrutinised by a European parliament economic and monetary affairs committee working group.
Posts
No comments:
Post a Comment