AIFM directive – creeping protectionism?

Spain raises protectionist fears – FT

Hedge funds and private equity groups have raised concerns about the risk of creeping protectionism in proposals made by Spanish diplomats to re-write European Union legislation to regulate their industries, report Nikki Tait and Martin Arnold.

The FT journalists found that the compromise proposal is still not ticking all the right boxes. Here’s an excerpt..

Andrew Baker, head of the Alternative Investment Management Association, which represents many hedge funds, said the Spanish were “to be commended for continuing the good work of the Swedish presidency”.

“There is much in this compromise text that is sensible and reasonable,” he said.

But he continued: “We are still concerned by some issues – in particular, the third countries’ section, which has been significantly changed and which could have unfortunate protectionist consequences. These . . . could [have an] impact not only on non-EU managers but also EU investors like pension funds – and therefore the pensions and savings of ordinary EU citizens.”

Private equity funds echoed that concern. “Workable solutions must be found to ensure firms from countries outside the EU can operate freely within the bloc,” said Javier Echarri, secretary-general of the European Private Equity and Venture Capital Association. “This half-way document is somewhat surprising.”

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FTfm's specialist writing team offer their insights into the global fund management industry.

About the authors

Pauline Skypala has been editor of FTfm for four years having previously been deputy personal finance editor. She joined the FT in 1999 and has been writing on savings and investment issues throughout her career.

Steve Johnson, FTfm deputy editor, has been a journalist for 17 years, 10 of which have been with the FT.

Sophia Grene, reporter on FTfm, has been a financial journalist in print and online for 12 years.

Ruth Sullivan has worked as a financial/business journalist and foreign correspondent and for the past 10 years has been at the FT.