The European Commission has said it will adopt a “targeted approach” in its review of the Alternative Investment Fund Management Directive, along with key harmonising provisions within the Undertakings for Collective Investment in Transferable Securities Directive.
The decision has been welcomed by The European Fund and Asset Management Association (EFAMA), demonstrating that the European Commission “recognises the role this framework has played in encouraging the growth in the European Alternative Investment Fund market over the past decade and its resilience even throughout recent market stresses”.
EFAMA adds that it “supports the intent behind the commission’s proposals in many respects, although [a certain amount] of the proposed amendments warrant further consideration to ensure against unintended consequences which may outweigh the benefits envisaged”.
In regards to depository services, EFAMA also welcomes the decision of the European Commission to not introduce a depository passport — outlining that the requirement for a depository to share the same domicile as the fund is an essential safeguard for investor protection.
EFAMA says that it also “strongly supports” the decision to extend the depository regime to include “investor” central securities depositories in the custody chain in order to “guarantee the same liability standards applied to a fund depository”.
Part of the European Commission’s targeted approach will entail a review for supervisory reporting, which will be carried out by European Securities and Markets Authority (ESMA).
The association will review the opportunities for the sharing of data between different regulators, including giving national competent authority access to data reported by managers to national central banks.
