MEPs on the Economic Affairs Committee have given the green light to tighter regulations on hedge funds and private equity.   Following agreement among several political groups, Jean-Paul Gauzès’ report on Alternative Investment Fund Managers was adopted,

Fencing in Hedge Funds

They met for what could have been   a mammoth voting session,

But agreement among some groups   saw a speedy process.

At stake was a proposal to regulate   Alternative Investment Fund Managers,

The report by former banker   Jean-Paul Gauzès was adopted.

I hope that we’ll be able   to take a big step forward

in regulating what I regard   as fair markets.

The 30 biggest funds have   assets of over a trillion euros,

Most EU funds are in London, where   there’s nervousness about the plans.

When you speak to those in   hedge funds and private equity

they say they won’t feel the impact,   it’ll be the investors.

The report would oblige funds   to register with a regulator,

impose greater transparency   and minimum capital requirements,

so there’s less borrowing,   but the report will also ban investment

in non-EU-owned funds,   managed from outside the Union.

Whether or not somebody   wants to invest in a fund

that is being managed according to   these new regulatory rules

or whether he’s willing to accept   the risk and go outside

and defend his decision before customers   and partners, it should be up to him.

The vote came a day before   a vote at the Council

which would allow investment in non-EU   funds under the correct conditions.

But some don’t think   the plans go far enough.

Voters expect now clear results   and very clear strategies

and it’s once again one of these   watered-down, typical EU compromises.

Parliament, Council and the Commission   will now negotiate a compromise.

The vote on that is likely   to come in the autumn.