Asset Managers Worry Over 'Letter Box' Hedge Fund Rule

Jul 13 2012 | 12:50pm ET

Hedge funds aren't the only asset management shops worried about the European Union's tough new alternative investment regulations.

Twenty traditional asset managers and investors are warning that the planned rules will have unintended consequences for their own businesses. The firms, which include Allianz, BlackRock, Fidelity Investments and Schroders, argue that one of the new regulations, which seeks to prevent hedge funds from registering at a "letter box" in one jurisdiction while operating from another, is too broad.

The asset managers told Michel Barnier, the European Commission's internal markets chief, that the rule could hurt their own ability to have risk and portfolio management decision-makers based in the market in which they are investing.

"We are extremely concerned that the forthcoming 'Level 2' implementing measures for the Alternative Investment Fund Managers Directive will undermine the single market," even disrupting UCITS fund management, the firms wrote.

In Depth

Financial Industry Blockchain Consortium R3 To Open-Source Platform Code

Oct 20 2016 | 9:03pm ET

Bitcoin's blockchain technology has spawned a flurry of activity among fintech startups...


U.S. Trust's Beard: The Rapid Growth of the Art Lending Industry

Oct 7 2016 | 10:55pm ET

Alternative investment managers have emerged as some of the most significant art...

Guest Contributor

Hedge Fund Marketing – Tips for Your Initial Sales Meeting

Sep 29 2016 | 5:46pm ET

There are two main goals a hedge fund should have for an initial in-person sales...