14/05/2010 Author: Tony Griffiths

Directive concerns prompt renewed lobbying effort

Growing concerns that the EU will push through its controversial hedge fund legislation have prompted a spike in lobbying efforts, including a fresh warning from industry body the Alternative Investment Management Association (Aima).

In a statement released today, Aima chief executive Andrew Baker warned that the consequences of the Directive – criticised most vehemently for its perceived protectionist approach to non-EU jurisdictions – would be much wider than on just the hedge fund and private equity industries. “Real estate and infrastructure investment in Europe would also be impacted because funds in this sector would also be covered by the Directive,” he said. “We’re talking about schools, hospitals, shopping centres, things that affect ordinary EU citizens.”

Aima joined UK investor groups the Investment Management Association (IMA) and the National Association of Pension Funds (NAPF) in last week writing a number of Econ MEPs in order to register their concerns ahead of Monday’s vote.

As seen by HFMWeek, the letter criticises a compromise amendment put forward by Econ’s AIFM rapporteur Jean-Paul Gauze that has the potential to lock certain third-country fund domiciles out of the EU, calling it “unworkable”. The trio urged MEPs not to vote this amendment through, recommending alternative amendments put forward by Gauzes’ colleagues.

In this week’s HFMWeek, a Brussels based source said that Gauzes remained determined to push through his amendment, which has the backing of most socialist MEPS, in order to secure as big a voting majority as possible. 

Both of the EU’s legislative tracks, Parliament and Council, are due to vote on their versions of the Directive next week: parliamentary committee Econ on Monday 17 May and the Ecofin council of EU finance ministers, whose original vote was delayed following a last-minute plea from then-UK PM Gordon Brown, the day following.

Reports have suggested that, with the new, apparently Euro-sceptic Conservative government in the UK, the alternatives industry argument is also without the support needed to block voting in the EU Council.