News
BackThis week, a second debate took place in the Committee on Economic and Monetary Affairs (ECON) of the European Parliament in Brussels on the planned intention of the European Commission to regulate hedge funds and private equity firms for the first time at European level. The proposal of the Commission has to be decided in the so-called codecision procedure by both the European Parliament and the Member States. Both organs have already begun to examine the content of the Commission proposal.
Rapporteur Gauzès presents working document
The rapporteur in the Parliamentary Committee is the Frenchman Jean-Paul Gauzès (EPP), an experienced parliamentarian for difficult dossiers. He presented a working document that contains those issues, which are to be discussed between the fractions. The Austrian MEP Othmar Karas (EPP) remarked that the appointment of Gauzès as the rapporteur had been a good choice, however, apart from that all fractions had to make a superior effort to find a solution within Parliament.
Goebbels: Financial industry doesn’t want to be regulated at all!
What it is really all about became clear in a comment by the Luxembourg shadow rapporteur Robert Goebbels (Socialists & Democrats S&D). Although he was a member in ECON for ten years now, he never had experienced such an extent of lobbying, said Goebbels. Currently his desk was aching under the weight of lobbying documents of the financial industry. The tenor of most statements of the industry on the Commission proposal would be “Yes, but …”. All financial market players say that their situation was special and different. In reality the financial industry did not want to be regulated, said the Luxembourger. The industry would be quite concerned, but the concerns of the population would be even greater.
Was EU Commissioner McCreevy “harrassed”?
The comment of the Swedish Liberal Olle Schmidt went into the completely opposite direction. “Do we need regulation”? - No!” said Schmidt and expressed exactly what the financial industry feels. The draft of the Commission could be traced back to “political harassment” of the Internal Market Commissioner Charlie McCreevy. The committed Irish supporter of a free and unregulated market had been forced into this proposal.
Klute and Karas: regulate the funds not the managers
The German Jürgen Klute addressed a point, which has been pointed out by many experts - and also by AK. The funds themselves had to be regulated and not only, as proposed by the Commission, the fund managers. Surprisingly enough, Othmar Karas shared his opinion. Klute also supported the idea for a financial transaction tax to be included in the report of the Committee.
MEPs: the EP should assert itself against the Member States
There is also something interesting going on with regard to the roadmap of the European Parliament. So far the plan is to have a trilogue with the Council and the Parliament after the 1st reading in the Parliament in order to avoid a second reading. Many parliamentarians were sceptical about this plan. Karas pointed out that perhaps an agreement in Parliament could be easier achieved than in the Council as the Member States in the Council would have very different positions. “The 1st reading in parliament could give the Council a helping hand”, said Karas. A similar opinion was expressed by the German Social Democrat Udo Bullmann: the EP should be confident and not signal that a compromise would be aimed at in the 1st reading at any price.
The race for exemptions has begun
The Directive’s area of application attracted many requests to speak. It is a known fact that the Commission proposed that all types of funds, which have not yet been regulated, should come under the Directive’s area of application. However, the great race of the lobbyists to request exemptions for their industries has already started in the background.
The Austrian Karas even mentioned that he was approached by funds representatives, who believed that they would be disadvantaged because of the name of the Directive (“Alternative Investment Funds”) and proposed to rename it. Apart from that, funds, which are exclusively active at national level, should be less regulated, said Karas.
The roadmap for further developments
Apart from that, the Parliament has commissioned two own impact assessments in order to fill the “gaps” in the impact assessment of the Commission, informed the British Liberal Committee chairwoman Sharon Bowles. They should be complete by the end of November. The Swedish Council Presidency of the Member States promised that the negotiations in the Council for the autumn would be transparent. And the Commission too signalled readiness to debate the issue, although it indicated that it intends to hold on to the Directive’s scope. On 10th November a hearing of experts on this subject will take place in the European Parliament.
Further information:
Working Document of the EP rapporteur Jean-Paul Gauzès on hedge funds
AK Position Paper on Hedgefunds and Private Equity
The rapporteur in the Parliamentary Committee is the Frenchman Jean-Paul Gauzès (EPP), an experienced parliamentarian for difficult dossiers. He presented a working document that contains those issues, which are to be discussed between the fractions. The Austrian MEP Othmar Karas (EPP) remarked that the appointment of Gauzès as the rapporteur had been a good choice, however, apart from that all fractions had to make a superior effort to find a solution within Parliament.
Goebbels: Financial industry doesn’t want to be regulated at all!
What it is really all about became clear in a comment by the Luxembourg shadow rapporteur Robert Goebbels (Socialists & Democrats S&D). Although he was a member in ECON for ten years now, he never had experienced such an extent of lobbying, said Goebbels. Currently his desk was aching under the weight of lobbying documents of the financial industry. The tenor of most statements of the industry on the Commission proposal would be “Yes, but …”. All financial market players say that their situation was special and different. In reality the financial industry did not want to be regulated, said the Luxembourger. The industry would be quite concerned, but the concerns of the population would be even greater.
Was EU Commissioner McCreevy “harrassed”?
The comment of the Swedish Liberal Olle Schmidt went into the completely opposite direction. “Do we need regulation”? - No!” said Schmidt and expressed exactly what the financial industry feels. The draft of the Commission could be traced back to “political harassment” of the Internal Market Commissioner Charlie McCreevy. The committed Irish supporter of a free and unregulated market had been forced into this proposal.
Klute and Karas: regulate the funds not the managers
The German Jürgen Klute addressed a point, which has been pointed out by many experts - and also by AK. The funds themselves had to be regulated and not only, as proposed by the Commission, the fund managers. Surprisingly enough, Othmar Karas shared his opinion. Klute also supported the idea for a financial transaction tax to be included in the report of the Committee.
MEPs: the EP should assert itself against the Member States
There is also something interesting going on with regard to the roadmap of the European Parliament. So far the plan is to have a trilogue with the Council and the Parliament after the 1st reading in the Parliament in order to avoid a second reading. Many parliamentarians were sceptical about this plan. Karas pointed out that perhaps an agreement in Parliament could be easier achieved than in the Council as the Member States in the Council would have very different positions. “The 1st reading in parliament could give the Council a helping hand”, said Karas. A similar opinion was expressed by the German Social Democrat Udo Bullmann: the EP should be confident and not signal that a compromise would be aimed at in the 1st reading at any price.
The race for exemptions has begun
The Directive’s area of application attracted many requests to speak. It is a known fact that the Commission proposed that all types of funds, which have not yet been regulated, should come under the Directive’s area of application. However, the great race of the lobbyists to request exemptions for their industries has already started in the background.
The Austrian Karas even mentioned that he was approached by funds representatives, who believed that they would be disadvantaged because of the name of the Directive (“Alternative Investment Funds”) and proposed to rename it. Apart from that, funds, which are exclusively active at national level, should be less regulated, said Karas.
The roadmap for further developments
Apart from that, the Parliament has commissioned two own impact assessments in order to fill the “gaps” in the impact assessment of the Commission, informed the British Liberal Committee chairwoman Sharon Bowles. They should be complete by the end of November. The Swedish Council Presidency of the Member States promised that the negotiations in the Council for the autumn would be transparent. And the Commission too signalled readiness to debate the issue, although it indicated that it intends to hold on to the Directive’s scope. On 10th November a hearing of experts on this subject will take place in the European Parliament.
Further information:
Working Document of the EP rapporteur Jean-Paul Gauzès on hedge funds
AK Position Paper on Hedgefunds and Private Equity