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Rapporteur Poul Nyrup Rasmussen (PSE/DA) published the long awaited draft report on hedge funds and private equity. The rapporteur requests the Commission to submit to Parliament by
- ‘Financial Stability and Better Functioning Financial Markets’
- Transparency;
- Exessive Debt; and
- Conflicts of Interest.
Among many other aspects, the rapporteur calls conventional funds including UCITS and pension funds/IORPs to comply with capital requirements, and to strengthen the capital requirements for prime brokers. The Commission should also establish an EU Public Credit Rating Agency and a European supervisor.
An EU framework for the registration and authorisation of entities that control the investment of hedge funds or private equity should be established, as well as a notification (i.e. approval) of wholesale investment vehicles.
The rapporter, furthermore, asks for a limit on leverage for hedge funds and calls the Commission to devise the upper limit in the debt of hedge funds and to establish a public register of structured products in the EU.
Finally, a competition inquiry should be launched into market concentration in the following financial services industry sectors: hedge funds, private equity, investment banks (with focus on prime brokerage services) and CRAs.