Considerable disparities exist between EU member states over regulations and incentives surrounding venture capital and private equity, despite the single market, the European Private Equity and Venture Capital Association (EVCA) has told European Union (EU) representatives.
The point was raised at the EVCA’s three-yearly policy meeting, which sees senior EVCA and EU members meet to discuss future developments and expansion of the private equity and related industries, including pension funds.
The issue formed the main topic of a recently published EVCA white paper, which constituted the basis of the discussions.
Nonetheless, the amount invested in European companies by the European venture capital and private equity industry last year rose 39% to €34.9bn, with pension funds being the largest source of capital.
The EU is represented at the conference by three directorates general: internal market, economic affairs, enterprise and information society.
In its white paper and in line with its priorities about long term sources of capital and fund formation, the EVCA urges pension funds across Europe to employ the prudent man principle as in the US and UK and start investing more heavily in private equity funds.
It also examines the problems caused by the different tax structures that exist across Europe and how these often hamper cross border investments. The EVCA says it would also like to see fiscally transparent and harmonised fund structures to alleviate this problem.