France's assault on The City draws fire

[I am indebted to Open Europe for these leads)

What this boils down to is that the French saw their chance to shut down the successful non-French businesses of Hedge Funds and Private Equity  as part of their open war on The City of London.  THEY drafted the proposals for the EU and THEY haven’t a clue about the subject.  

What’s proposed is utter chaos and the only beneficiaries would be New York and Switzerland.  Obama sees their worth and  the New York TYimes says “the EU should follow US President Obama's lead in deciding to not regulate hedge funds and private equity.” 

Christina

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CITY AM    25.6.09

Trio of regulators slam EC’s hedge fund regulation plans

EU REGULATION   - ROB DAVIES

THE EUROPEAN Commission’s (EC) proposals for regulation of the alternative investment industry are flawed, three of the world’s top regulatory reformers said yesterday.

Jacques de Larosière, author of the report behind the EC’s plans for a pan-European regulatory system joined Financial Services Authority chairman Lord Turner and Conservative adviser Sir James Sassoon in criticising the EC’s draft directive on the regulation of hedge funds and private equity.

Speaking at a conference hosted by think-tank Business for New Europe, Delarosiere said he had “some doubts on the wisdom of some aspects of the directive,” such as leverage requirements, adding that “private equity should be kept out of heavy regulation”.

Lord Turner said he was concerned that the alternative investment sector had become a “target”. 

And Conservative adviser Sir James Sassoon said: “It’s hard to find a kind word to say about a directive so disproportionate in scope, so protectionist in its effect and so poorly drafted.”

Business minister Lord Myners said he had received assurances from Sweden, which takes over the EU presidency on 1 July, that it would work with the UK to explain the merits of the alternative investment industry to European counterparts such as France [- - - ‘who are pig-ignorant and prejudiced on the subject‘-cs] 

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CITYWIRE    24.6.09

FSA criticises 'rushed' EU funds directive

By Daniel Grote 

The Financial Services Authority (FSA) has urged the European Commission to make changes to a new funds directive it said had been rushed out before the consequences of its sweeping reforms have been established.

Dan Waters, FSA asset management sector leader, called for changes to the EU’s new Alternative Investment Fund Managers (AIFM) Directive which affects non-UCITs regulated funds marketed in the EU.

‘Perhaps out of necessity, it was produced under extraordinary time pressure. This has yielded a directive whose scope and content are a surprise and in many cases a complete shock to the markets that are affected,’ he said.

‘The impact analysis, performed at a high level on the back of the early general thoughts, could not possibly have addressed the myriad detailed impacts of the sweeping scope of this directive.'

He added: ‘We urge the Commission, therefore, to listen hard to affected stakeholders as the debate around the Directive proceeds.’

Waters said that the current proposals had too wide a remit, as they encompassed areas like tax reporting, portfolio company disclosure, employee protection and short selling that are not limited to the alternative investment world.

‘It strikes us as highly unusual to say the least to tackle issues with general market applicability through a directive targeted at the funds industry alone,’ Waters said. ‘If we need a directive on tax treatment of financial instruments, then let us have one, rather than picking off subsectors of the financial industry without regard to their wider implications.’

He called for more clarity over the proposals to limit the amount of leverage non-UCITs funds can take, warning that they could morph into prescriptive regulation of hedge funds that could prove destructive. He added that imposing leverage restrictions on hedge funds similar to those imposed on UCITs funds was unnecessary as they are not marketed to the retail public