AIMA

28 April 2010

“The statement by the French and German Finance Ministers, Christine Lagarde and Wolfgang Schäuble, in today’s Wall Street Journal, is an important step forward in the debate over the European Union’s draft Alternative Investment Fund Managers Directive.

“We very much welcome the comments by Mrs. Lagarde and Mr. Schäuble that ‘France and Germany believe in open financial markets’ and that ‘qualified investors should be free to invest in funds from all around the globe irrespective of quality standards set for state-of-the-art European hedge funds’. Given the widespread international concern over possible protectionist consequences of the Directive and the potential impact on European investors, this is a significant and reassuring statement.

“While the comments by Mrs. Lagarde and Mr. Schäuble are welcome, we would note that the current texts of the Directive do not necessarily reflect these sentiments, and we presume that the French and German governments would therefore support appropriate revisions in line with these remarks. In particular, while Mrs. Lagarde and Mr. Schäuble say that EU investors should be free to invest in non-EU funds as long as non-EU investment funds and their supervisors provide for adequate information exchange to mitigate systemic risk, the current text being discussed at Council level imposes additional requirements on non-EU funds beyond this.

“We do agree that it is important that the AIFM Directive addresses the issue of systemic risk; AIMA, as the global hedge fund industry association, has consistently supported transparency by the industry in this respect, namely the reporting of systemically relevant data in the interests of financial stability to national supervisors.

“We also remain concerned about the details of the practical application of this Directive and would urge policymakers to liaise closely not only with the industry but with the regulators with the most experience of the sectors covered by this Directive to ensure a consistent, proportionate and practical piece of final legislation.”

Andrew Baker, CEO, AIMA
 

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