Thu, Sep 29, 2016
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

AIMA responds to ESMA’s AIFMD consultation paper

Thursday, September 15, 2011

Andrew Baker
Opalesque Industry Update - The Alternative Investment Management Association (AIMA), the global hedge fund association, has responded to a consultation by the European Securities and Markets Authority (ESMA) on how the Alternative Investment Fund Managers Directive (AIFMD) should be implemented.

ESMA, which is responsible for advising the European Commission on the implementing measures for the AIFMD, sought feedback on a consultation paper it circulated in July.

AIMA said many of ESMA’s draft proposals were “measured”, but several major areas of concern remained, including proposals relating to depositaries, leverage, valuation, transparency and liquidity management. So-called third country (non-EU) issues are covered by a separate and on-going ESMA consultation exercise.

Where possible, AIMA has strived in its 111-page response to provide an economic impact assessment of the Directive as well as detailed legal analysis.

For example, an AIMA study into the potential impact on depositaries found that, under the most adverse scenario, the total cost to hedge funds of implementing the more draconian options proposed in the paper could be more than US$6 billion.

AIMA said that those costs inevitably would be passed on to hedge fund investors such as pension funds, charities, universities and insurers. The Directive could lead to such high costs because depositaries would sharply increase their fees to funds to compensate them for the strict liability they would be expected to absorb for any losses incurred by unaffiliated sub-custodians which the former cannot realistically control.

AIMA CEO Andrew Baker said: “We wish to congratulate ESMA on a job well done in difficult circumstances and to a tight timetable. We hope they finalise the advice in the independent and evidence-based spirit in which they produced this consultation document.

“However, there remain a number of areas that continue to cause us difficulty, most notably the proposals relating to depositaries. While some of the proposals made by ESMA in this area are undoubtedly welcome, we are concerned that some of the options on the table are so extreme that the eventual regime could end up being not only wholly unworkable but also potentially dangerous by greatly increasing systemic risk. We would urge ESMA to look again at these proposals and opt for the more practicable options they put forward.”

The AIMA response can be viewed on ESMA’s website here:Source

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Nobel Sustainability Trust, Prince Albert II of Monaco help launch major new initiative to drive sustainable technologies[more]

    Matthias Knab, Opalesque: The Nobel Sustainability® Trust ("NST") is leading a major new initiative to finance, incubate and accelerate the development of clean technologies. The initiative will start with the formation of the Nobel Sustainability Fund® ("NSF"). NSF will drive faster access t

  2. Studies - Hedge funds’ study reveals vast disparity in types of investors securing side letter arrangements, Cambridge: Look to private investments for best access to LatAm growth[more]

    Hedge funds’ study reveals vast disparity in types of investors securing side letter arrangements A new study of the hedge fund space by industry law firm Seward & Kissel LLP reveals a wealth of information regarding established hedge fund managers’ use of side letters—special agreements

  3. Activist News - Caesars 'optimistic' on deal with hedge fund creditors[more]

    From Reuters.com: Caesars Entertainment Corp said on Monday it remains "optimistic" of reaching a $5 billion deal with the bulk of its creditors to push its main operating unit out of bankruptcy, but one hedge fund bondholder said it will pursue litigation. Caesars offered a sweetened $5 billion set

  4. Hedge funds recover from losses as central banks give markets a respite[more]

    Komfie Manalo, Opalesque Asia: The Lyxor Hedge Fund index was up 0.4% from the week ending September 20 (-2.4% YTD), supported by the willingness of central banks to remain accommodative, Lyxor Asset Management said in its weekly briefing. It ad

  5. Perry Capital closing flagship fund after almost three decades[more]

    From Blooomberg.com: Richard Perry, one of the biggest names in hedge funds, is calling it quits after 28 years. Perry, 61, is winding down his New York-based flagship fund as the industry confronts one of the most tumultuous periods in its history. In a letter to investors Monday, he said his style