British Lords Join In Savaging Proposed European Hedge Fund Rules

Feb 10 2010 | 12:00pm ET

The U.K.’s House of Lords is urging the British government to veto proposed strict new alternative investment regulations currently being debated by the European Parliament.

The House of Lords European Union Committee said the U.K. “should not agree” to the Alternative Investment Fund Managers directive unless it is substantially altered. The proposed rules would impose strict new reporting and custody requirements on hedge funds and private equity funds, as well as possible leverage limits.

But, as written by the European Commission, the rules would sap European competitiveness, the Lords complain. The U.K. should not accede to the proposal unless it is made “compatible with equivalent legislation with regulatory regimes in third countries and in particular in the United States.”

“The U.K. government should do everything it can to ensure that the final proposals that emerge in the AIFM Directive do not damage the EU and U.K. economies to which the City of London makes an important contribution,” Kenneth Woolmer, a member of the Lords committee, told Bloomberg News.

The Lords report is the latest salvo attacking the proposal from across the Channel. Earlier this week, both the Bank of England and Financial Services Authority warned that the rules could have disastrous unintended consequences for European economy.


In Depth

Dillon Eustace: The Advantages of ICAVs

Feb 11 2016 | 7:51pm ET

As the growth of alternative investment vehicles continues, global asset managers...

Lifestyle

Citadel's Ken Griffin Donates $40M To New York's Museum of Modern Art

Dec 22 2015 | 9:23pm ET

Citadel founder Ken Griffin has donated $40 million to New York’s Museum of Modern...

Guest Contributor

Hedging Against Reputational Risk in the 21st Century

Feb 12 2016 | 7:18pm ET

For investors, the first step in researching a new fund or manager is to google...