Europe's venture capital and growth capital communities that will not be hit by controversial regulations governing the private equity industry have called for the European Commission to implement a lighter-stance regime for them to enhance their international credibility.
Responding to a consultation on how they should be regulated, the firms said they would like to be regulated, but that the regulation must be “optional, proportionate and open to all investors in small and medium-sized enterprises.”. Small private equity firms, which manage less than €500m, will not be included in the Alternative Investment Fund Managers’ Directive.
The European Private Equity & Venture Capital Association, which coordinated the response, said: “The fact that the AIFMD is not tailored for small funds’ managers in general is a major deterrent, as many institutional investors could well choose to exclude non-AIFMD compliant funds from their scope. In addition to this is the logistical and cost issue of having to raise funds country by country, without a passport, which is a further impediment”.
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