NETHERLANDS – A proposal to exempt investment managers acting solely for pension funds from the Alternative Investment Fund Managers Directive (AIFMD) when it is transposed into Dutch law is unlikely to gain approval from the parliament’s upper house, according to Bouwfounds REIM fund director Xavier Jongen.
Jongen, who also chairs the INREV public affairs committee, told IP Real Estate that the proposal – which has already gained approval from the lower house, despite opposition from the finance ministry – is likely to face opposition from the upper chamber, where it is currently facing scrutiny.
Even were it to pass through the Dutch parliament, the proposal is likely to come under pressure from ESMA, which is advising member states on transposition.
The proposal to exempt pension fund managers is understood to have originated with APG, although the pension fund manager did not confirm or deny its involvement.
As it stands, the AIFMD will impose new requirements not only on fund managers but on property managers and valuers, who will have to adapt to new rules on delegation and valuation.
According to Jongen, the proposed exemption – which he supports in principle – would threaten internal market transparency.
"The key problem is the level playing field," he said. "If the Netherlands exempts managers of pension funds, you would need to have the same exemptions in other jurisdictions – which means other countries would have to accept the clause passed by the Dutch parliament.
"It would also create a two-tier investment management industry, with some Investment managers bearing more costs because of the AIFMD."
Despite the somewhat surprising progress of the proposal so far, Jongen argued that the Dutch fund management industry had resigned itself to the AIFMD because the political tide was against it.
In fact, he said, there had been "little open intellectual challenge" to the AIFMD due to "political reasons".
This week, he said: "Goodwill towards the financial sector is very, very low. There is political pressure to regulate the industry and not to accept exemptions.
"There is very little the industry can do against it and very little room for debate on the issues because it is politically tainted."