Following the Prime Minister's commitment to cut the
administrative cost of regulation on business by a quarter last
month, the Treasury will consult on changes to rules governing
Alternative Investment Fund Managers (AIFMs).
It will be focused on removing unnecessary barriers to investment
by making rules less onerous for AIFMs. This will save asset
managers millions in time, money and resource – while freeing
them to help the UK's most exciting businesses scale up, grow and
create jobs.
, Economic Secretary to the
Treasury, said:
We want to bring security to working people by going further and
faster to drive growth through our Plan for Change.
That means making Britain the number one place to do business and
tearing down unnecessary barriers to investment, such as costly
regulation that prevents asset management firms from growing and
provide capital for businesses across the country to grow.
Simon Walls, Interim Executive Director of Markets at the
FCA, said:
We want rules, better tailored to UK investment managers. These
could allow them to operate more efficiently, further supporting
competition, competitiveness and economic growth.
It's part of our wider work to streamline the regulatory regime
for asset managers, to support the continued competitiveness of
our world-leading financial services as outlined in our new
strategy.
, Chief Executive of the
British Venture Capital Association, said:
We welcome the government's consultation on developing a simpler
and more competitive system for alternative investment fund
managers (AIFMs). More effective, less burdensome regulation will
make the UK private capital industry more globally
competitive and help it to boost investment from the UK and
international investors into growing
British businesses.
This consultation is an important step in securing the UK's
status as one of the world's leading private capital hubs. We
look forward to engaging on the principles and the detail of the
changes, but this provides the opportunity to create a real boost
for the Government's growth mission by developing the UK's
private capital fund ecosystem and increasing inward investment
in UK SMEs.
Together with the FCA we plan to refresh outdated regulatory
thresholds. The consultation will take place over the next 9
weeks, providing hedge funds, private equity firms, and
investment trusts the opportunity to contribute to the
development of a more streamlined regulatory
environment.
Currently, firms face a suite of new regulatory burdens once they
hold 100 million euros in assets, which can discourage some firms
from growing and financing more investment across the country.
This inadvertent cliff edge means that smaller asset management
firms immediately have to sign up to the same rules as the
biggest firms once they reach this threshold, bringing about
large costs.
The consultation aims to create a more graduated regime, where
only the largest firms – with the value of over £5 billion are
subject to the full scope of requirements, with the majority of
firms subject to much less prescriptive rules, helping to reduce
admin costs for those businesses.
Once the consultation has concluded, feedback from the asset
management sector will be used to design draft legislation which
will then be shared with asset management businesses next
year.
Further information
