Ian Hamilton

This column is authored by Ian Hamilton, who is the founder of IDS Group. IDS provides fund administration services in Africa and Europe through Malta. He is also the founder of Scotstone Investments, a company that has fund structures and services for global emerging new managers.

Having been in a number of European jurisdictions the past few weeks trying to resolve AIFMD issues and log jams, I have to admit part of the problem is also due to the Hedge Fund industry itself.

We all knew that AIFMD was coming into effect but many of the problems that are now arising are of concern.

I am sure readers of this column are aware that I am no friend of Brussels. A bloated, unelected overbearing bureaucracy, that is not accountable to anybody.

The issue that many regulators have in grappling with AIFMD is that it is a Directive and not a Regulation. Therefore it is subject to interpretation by the Regulator which means that there can be a divergence between different jurisdictions.

Furthermore, there can be divergence in the jurisdiction itself if the Regulator does not firmly issue its own interpretation of the directive. A common experience is that those at the top in the Regulator are out of touch with those below. For example a number of Regulators proudly announce that they have a pragmatic approach to the Directive and then exactly the opposite occurs when you encounter the more junior levels.

The other issue is the additional or enhanced staffing levels that are required by the Regulator to implement AIFMD. Most of the Regulators have been caught short which has caused unnecessary delays.

What is exacerbating this issue is the investm......................

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This article was published in Opalesque's New Managers a top-down monthly analysis, news and research publication on the global emerging manager space.