The second day of the 2013 ALFI Spring conference continued to focus on the impacts of the regulatory changes in the years ahead.
There was recognition by many that the genesis of the AIFMD was political but it was too early to say if the directive would achieve its goals including increased investor protection.
\”This year the atmosphere is more confident\”, said Renaud Oury, Chief Sales and Marketing officer for Kneip. “People want to be optimistic, they know the crisis will last but business must continue and Luxembourg has good opportunities within the AIFMD.\”
\”Luxembourg is known for UCITS and we will be able to position ourselves within AIFs as a centre of excellence in order to broaden our landscape. Regulation is needed to create trust for end-clients that will in turn allow people to have access to more products. Alternative fund regulations provide transparency.\”
Luc Verbeken, the brand new MD of ING (Luxembourg), said: “We want to be compliant with AIFMD and we are discussing our strategy for funds and how we can both develop that market, and be in that stream. It is extra work to be compliant but Luxembourg has the flexibility and adaptability for it to be good news. We now see a lot of UK funds looking at Luxembourg as a domicile.”
Sense of balance
In a review of the presentation by the EU Commission, Freddy Brausch Senior Partner of Linklaters said: \”There is much more of a sense of balance from previous years which is an encouragement for the industry. There is no indication of a desire by the commission to over-regulate and we are moving away from the financial sector bashing.”
The reaction of the Hedge Fund industry to AIFMD was also discussed. Large European investors are demanding fund managers using Cayman funds to move onshore, and in general investors care more about the structure used than in previous years, however it is still unknown if the operating costs of such a move will have an impact or in some cases be prohibitive. “Most hedge fund managers are in the UK and most hedge funds are in Cayman”, said Jérome Wigny, partner of EHP.
A recent FSA consultation paper suggested that the UK might try to avoid the AIFMD altogether and additionally Hedge Fund managers may prefer the job title of advisor, also as an attempt to avoid the requirements of the regulation of remuneration. When asked about the impact of regulation of Luxembourg structures Helmut Hohnmann, MD of Alceda, said that self-managed SICAV’s will tend to disappear and as asset managers based in Switzerland do not wish to move to Luxembourg, they will use the services of third party Mancos.
For an Investment Fund to set up their own full services management company in Luxembourg they will need a team of 12-15 people and at least 500m of assets under management (AuM) to justify the costs.
Original article published here: http://www.wort.lu/en/view/aifmd-genesis-was-political-5149ec89e4b0abd74a04eb54