HEDGE FUNDS: REGULATION, TRANSPARENCY AND SUPERVISION FOR ALL

A call tomorrow for formal regulatory control of all hedge funds, without exception, will include demands to ban asset-stripping, limit debt and strengthen requirements for openness.

The European Parliament's S&D Group will set out its position in a debate on EU legislation on Alternative investment funds.

Group spokesman on economic and monetary policy, Udo Bullmann, said: "In our view, the compromise put forward by the Swedish presidency of the EU Council is not ambitious enough. We believe that future EU legislation must cover all alternative investment funds and their managers without exception.

"We have to end the murky methods by which these funds have worked."

S&D proposals include:

Limiting the leverage or debt that the funds can incur, but also fixing a threshold above which the funds must inform regulators;

Fixing a framework for remunerations;

Accepting the proposed passport principle, which gives the right to market funds throughout Europe, but only for fund managers operating in the EU and funds located in the EU; non-EU funds should be allowed in the EU market under the condition that their country of origin has a supervisory system recognised equivalent as the EU one and has signed a tax cooperation agreement.

Imposing the strictest requirements for disclosure and information.

The full text of the S&D policy position is at: http://www.socialistsanddemocrats.eu/gpes/media3/documents/3214_EN_direc...