EUROPE - MEPs on the European Parliament's Economic and Monetary Affairs (ECON) Committee have continued discussions on a set of draft compromise amendments to the AIFM Directive, despite the issue being postponed by the Spanish Presidency of the European Union earlier in the week.
The set of amendments presented by Jean-Paul Gauzès, Rapporteur of the committee, cover the controversial issues relating to the Directive, including scope, funds and fund managers based in third-party countries and how to deal with private equity funds.
However, while the compromise proposals are expected to reduce the large number of amendments initially put forward on the Directive - estimated at more than 1,000 - to make the discussions and vote more manageable, the European Parliament said there is still no definitive agreement as yet. (See earlier IPE article: Rapporteur swamped by more than 1,000 AIFM amendments)
Instead, it suggested this set of compromise amendments will be superseded by other agreements before the vote in ECON on 12 April 2010, because discussions on the proposal are ongoing between the political parties.
Meanwhil, the draft proposals suggest the scope of the Directive should include all non-UCITS funds, although there will be distinctions between the types of funds with some regulated more lightly.
Gauzès' previous idea of a transition period on third country issues is also included in the draft, which would allow the Commission to search for "regime equivalence" for funds and managers located in non-EU countries, and where this exists the funds can be marketed in all member states. (See earlier IPE article: Gauzès proposes 138 changes to AIFM Directive)
The current proposals suggest that if there is no equivalent regime, investors can still invest in non-EU funds on their own initiative, and those created before January 2010 would be allowed to be marketed in the EU through the private placement regime. It is suggested, however, that fund managers whose country has no equivalent regulatory regime will be barred from EU marketing, and EU investors will be "forbidden" from investing in funds under these managers.
Speaking at the ECON committee, Gauzès said: "We should not wait for the Council. By continuing our work on schedule the Parliament will be able to produce a text, which will provide a good basis for the other institutions."
He added that in all probability the discussions would reach a "good consensus" ahead of the committee vote in April. After this point, the proposed position of the Directive will be passed to the plenary of the Parliament for a vote in July.
The new set of draft proposals was discussed just two days after the issue of the AIFM was dropped from the agenda of the European Council's Economy and Finance (ECOFIN) meeting. The decision to postpone the subject was made by the Spanish Presidency to "ensure the maximum support possible" for the Directive, although it is still planned for an agreement to be reached before the end of Spain's presidency in June.
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