Alternative Investment Fund Managers Directive

The Alternative Investment Fund Managers Directive COM (2009) 20 is a proposed European Union law which will put hedge funds and private equity funds under the supervision of an EU regulatory body. These kinds of business vehicle have not been subject to the same rules to protect the investing public as mutual and pension funds. Lack of financial regulation is widely seen to have contributed to the severity of the global financial crisis. The European Parliament voted through a final text of the Directive on 11 November 2010.^[1] The proposals have to be written into national statute books by 2013, and only then will they really begin to bite.^[2]

Overview

The AIFMD proposal includes the following reforms.

• A private equity fund must appoint an independent valuer and an independent custodian.
• A private equity fund with EU investors must disclose its business plan for a portfolio company to that company, its other shareholders and employees, and make that information public.
• Investors would not be able to invest outside the EU unless it was under an "equivalent" regime.
• Imposes limit to leverage for one time the amount of capital across a fund.^{[clarification needed]}

The right-wing think tank Open Europe has estimated that the hedge fund and private equity industry contribute €9.2 billion in tax revenues to the EU economy every year, which would come under threat if the EU's AIFM directive would have been passed in its original flawed form.^[3]

This section requires expansion.

See also

• Markets in Financial Instruments Directive 2004/39/EC
• Undertakings for Collective Investment in Transferable Securities Directives 2001/107/EC and 2001/108/EC
• Investment Company Act of 1940
• European company law
• UK company law and German company law

Notes

External links

• EU's main page on alternative investments
• EU's consultation document

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