Geraldine Levy, senior regulatory lawyer, Axiom

EU rules: regulatory arbitrage?

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  • Very insightful article, particularly in light of today's FT article on Germany refusing to sign MOUs with various offshore hedge funds.

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  • "For US, Asian and other non-EU incorporated managers, the need to market funds on a country-by-country basis won’t be scrapped until 2018 at the earliest, depending on a review conducted by the European Commission."
    This is wrong. What the commission will decide in 2018 is whether private placement regimes should be abolished altogether, leaving full AIFMD authorisation as the only means for non-EU managers to access the European market. But it's possible that non-EU managers can become AIFMD=authorised from 2015 onward (in theory at least).

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  • I agree with the author, that an equivalence regime may create a level playing field but the inevitable delay in assessing EU third country regimes for equivalence purposes has been fraught with challenges. EMIR being yet another recent example. One cannot help but wonder if bodies such as IOSCO could not front run these assessments to avoid unnecessary delays which have such a detriment to third country firms.

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  • The problem with this article is that the two-stage system is precisely what the US and other non-EU fund managers lobbied for. US managers do not want the passport, and hardly any will apply for it in late 2015. US managers do not want to become subject to full authorisation. So, sadly, the author is missing the point completely...

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  • Surely some non-EU managers will seek authorisation and some will not? You cannot homogenise an entire diverse industry. The author's point still stands.

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  • @David - ask any alternatives law firm and they will tell you 90% of their clients will not be seeking authorisation in late 2015...

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  • @pallum@David -I agree with David and the author. The point is a lack of choice which in turn results in a less competitive market. Not sure which law firms Pallum is referring to.....

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