EU Markets Chief Asks French To Soften Hedge Fund Line

Apr 14 2010 | 11:51am ET

The European Union’s internal markets chief is asking his political patron to compromise in a bid to push through controversial hedge fund regulations.

Michel Barnier has approached a top adviser to French President Nicolas Sarkozy, asking Sarkozy to drop his opposition to the so-called passport that would give foreign hedge funds access to all 27 EU member states. The French are dead-set against the rule, believing that foreign hedge funds should have to get the OK of each state before they are allowed to do business there.

But the British are dead-set against what they see as the protectionist aspects of the controversial rules, which would also impose strict new reporting and custody requirements on European hedge and private equity funds. Last month, British Prime Minister Gordon Brown blocked the approval of the rules by the EU’s finance ministers, and the opposition Conservative Party, tipped to win next month’s British elections, have pledged to continue Brown’s line.

Barnier has spoken with Xavier Musca, one of Sarkozy’s top economic advisers, according to Reuters. Sarkozy was instrumental in winning Barnier’s appointment to the EU’s top financial post.

Meanwhile, the legislator charged with maneuvering the hedge fund rules through the European Parliament also indicated a willingness to consider the passport, arguing that it could be a necessary concession to the bill’s opponents.

Jean-Paul Gauzes said that foreign funds that comply with the stricter European rules should be allowed to market their wares on the continent. He is currently negotiating with the European Parliament’s largest parties on the big in advance of an April 27 vote.

“There has to be an agreement between European supervisors and third-country supervisors,” Gauzes said.


In Depth

GSAM's Papagiannis: Liquid Alternatives For The Long Run

Apr 21 2017 | 8:44pm ET

Interest in liquid alternatives cooled a bit last year amid a broad shift in investor...

Lifestyle

Aston Martin Returns To Debt Market As DB11 Drives Turnaround

Mar 31 2017 | 5:21pm ET

James Bond’s preferred carmaker is returning to the public debt markets for the...

Guest Contributor

Debunking Conventional Investment Wisdom (Part II)

Apr 17 2017 | 5:56pm ET

The alternative investment industry is currently replete with buzzwords around data...

 

From the current issue of