Alternative Investment Management Association
29 April 2009
The draft Alternative Investment Fund Managers Directive published today by the European Commission is not a proportionate regulatory response to any of the identified causes of the current crisis. That is according to the Alternative Investment Management Association (“AIMA”), the international trade body for the hedge fund industry.
Florence Lombard, AIMA Executive Director, said, “This directive is not a proportionate regulatory response to any of the identified causes of the current crisis. All of the major reports which analysed the crisis in-depth, including the de Larosiere report and the Turner Review, concluded that hedge funds neither caused nor played a significant role in the crisis. This directive undermines the findings of these reports and the vast amount of work that is currently being undertaken by the G20, IOSCO and the Financial Stability Board. It also conflicts with the G20’s global plan for recovery and reform which calls for regulators and supervisors to “reduce the scope for regulatory arbitrage” and to “resist protectionism”.
Hastily prepared and without consultation, the directive contains many ill-considered provisions which are impractical and may prove unworkable. The unintended consequences of these measures may put thousands of jobs in several major European industries under threat and slow down any economic recovery. Additionally, many of the provisions will disadvantage European hedge fund managers against those outside of Europe, which could prove an incentive for them to move business elsewhere – negatively impacting badly-needed tax revenues for Member States.”
Florence Lombard concluded, “We understand the great deal of political pressure facing the Commission, however it is the Commission’s role to propose necessary, unbiased and effective legislation. This directive is punitive and falls far short of this goal. It also does not recognise or take into account the existing progressive and effective regulatory framework in some EU states.
AIMA is engaged with policy makers and regulators around the world and is supportive of fair and effective regulation. AIMA's new policy platform, published in February, includes support for the principle of transparency (disclosure by large hedge fund managers of their systemically significant positions to national regulators) and global authorisation and registration of hedge fund managers.”
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As the only truly representative global hedge fund association, AIMA, the Alternative Investment Management Association, has more than 1,100 corporate members worldwide, based in 40 countries.
Members include leading hedge fund managers, fund of hedge funds managers, prime brokers, legal and accounting firms and fund administrators. They all benefit from AIMA’s active influence in policy development, its leadership in industry initiatives, including education and sound practice manuals and its excellent reputation with regulators worldwide.
AIMA is a dynamic organisation that reflects its members’ interests and provides them with a vibrant global network. AIMA is committed to developing industry skills and education standards and is a co-founder of the Chartered Alternative Investment Analyst designation (CAIA) – the industry’s first and only specialised educational standard for alternative investment specialists. For further information, please visit AIMA’s website, www.aima.org.