HFSB Statement on Alternative Investment Fund Managers Directive

Date: Thursday, April 30, 2009
Author: Press Release

The Hedge Fund Standards Board (HFSB) has strong reservations about proposals contained in the European Commission’s Draft Directive on Alternative Investment Fund Managers and is concerned at the lack of consultation over the directive.

Antonio Borges, chairman of the Hedge Fund Standards Board, said:

“We are very surprised at some of the proposals contained in this directive given the efforts already underway to develop a new architecture for the world financial system.

“The draft directive has not been discussed with the key interested parties nor is it consistent with the analysis and recommendations of the Commission’s own experts – as outlined in the well received De Larosiere Report. The Directive also ignores the efforts already underway to develop global proposals such as those taking place under the G20 process.

“We are particularly concerned that the draft Directive opts for prescriptive norms, in contrast with the principles-based approach under which the industry developed in the UK. It would empower the Commission to issue detailed regulations, in effect sidelining national regulators. It would also force non-EU countries to approve equivalent regulation if they want to maintain access to the European market.

“The HFSB remains committed to the development of proposals that will reassure investors and provide more transparency and higher standards of conduct for fund managers. We will work with our American counterparts, who represent the vast majority of the Alternative Investment Industry, in order to move to a global approach whenever possible. And we will reject protectionist impulses, which will restrict market access and will ultimately hurt investors’ interests. “The publication of the draft is the start of a long period of public consultation, in which we will certainly participate. We hope to contribute to a substantial improvement in the current proposals.”

 

For further information please contact:

Peter Wilson-Smith, Quiller Consultants

John Eisenhammer, Quiller Consultants

Tel: 020 7233-9444

Further information about the HFSB:

1. The HFSB was formed in January 2008 to take forward the work started by the Hedge Fund Working Group (HFWG), whose report on best practice standards was published that month.

2. A total of 48 hedge fund managers accounting for about $200bn of assets under management have now committed themselves to the HFSB’s standards.

3. The HFWG report on best practice standards for hedge fund managers is available at http://www.hfsb.org.

4. Antonio Borges, chairman, was formerly Vice Chairman and Managing Director of Goldman Sachs International in Europe (2000-2008). Before that he was Dean of Insead (1993-2000) and Vice Governor of Banco de Portugal, the central bank (1990-1993).

5. The other trustees of the HFSB are:

  • Peter Clarke, CEO, Man Group
  • Paul Dunning, former CEO, FRM Ltd
  • Christopher Fawcett, member of the Board, AIMA
  • Kathryn Graham, Director, Hermes Pension Fund Management
  • Michael Hintze, CEO, CQS
  • Anthony Lim, President of the London office and Advisor, External Managers Dept, GIC
  • Paul Marshall, Executive Chairman, Marshall Wace
  • Nicolas Moreau, Chairman, AXA Investment Managers Ltd
  • Russell Read, former CIO, CalPERS, and now CEO of C Change Investments
  • George Robinson, CFO, Sloane Robinson
  • Manny Roman, co-CEO, GLG
  • Simon Ruddick, Managing Director, Albourne Partners