EU legislation on Asset Management
November 14, 2011
We were in Brussels last week to contribute to thinking on the extensive programme (‘raft' is the usual term) of legislation in train that affects asset managers. We were very well supported by the IMA and excellent arrangements, as always, were made by Scotland Europa.
2 things stood out: the receptiveness of EU authorities to a view from Scotland; and the extent to which asset managers are affected by proposals drafted with completely different types of business in mind.
We reckon that Scotland is the 4th largest centre for asset management in the EU, after the UK, France and Germany, measured by assets under management (which we put at about £750bn just now). So it is not surprising that Scottish views are taken seriously and the seniority of our interlocutors at the European Commission, and the warmth of their welcome, confirmed that.
We spoke about a range of legislation and proposals, including the Capital Requirements Directive and the governance requirements of other pieces of legislation. Relatively little account seems to have been taken of how legislation can affect agency-only businesses like asset management, which deal on behalf of clients and hold no capital of their own. The requirements seem to be applied by an assumption of equivalence with banks and other institutions, which is sometimes misplaced.
We had some very useful discussions and look forward to continuing the dialogue.
Owen
