With the departure of the U.K. and its influential (at one time, anyway) financial services industry from the European Union, it seemed at last the bloc would finally get to do what it always wanted to do vis-à-vis hedge funds, which is to say regulate them out of existence, or at least into friendly mutual-fund-type things. As it turns out, however, the wily French and practical Germans have other, more pragmatic plans which may prove even worse for the liberated but irrelevant island nation: Open arms and a firm nudge across the Channel.
“On AIFMD, we at this stage believe that there will be no need for a complete overhaul of the framework, we think of targeted adjustments here and there... it’s a success story,” said Ugo Bassi, director of financial markets at the EU executive European Commission….
Asset managers in Britain manage over a third of fund assets across Europe and the bloc has agreed to allow cross-border stock picking, known as delegation, to continue from January, when Britain will have fully left the EU…. But the funds sector is worried that Brussels will use its AIFMD review to make delegation harder by requiring asset managers to have more “boots on the ground” in the EU, in a knock to the City of London.