OPPONENTS of a cap on fund managers’ bonuses have just five months to finalise and pass legislation if they are to minimise the risk of the pay limits coming in, analysts warned yesterday.
The Lithuanian presidency of the EU wants to prioritise to Ucits V directive, which covers funds.
As the European Parliament narrowly voted down the pay cap part of the directive, quick action to push through this directive could mean the industry escapes the same kind of treatment coming in in the banking sector.
But if the negotiations are protracted and last beyond next year’s European Parliament elections, the industry could face further threats depending on the new make up of the elected chamber.
“If Ucits V can be agreed in the Lithuanian presidency, with the Commission, the Parliament and the European Council agreeing, it is likely it will be without the bonus cap,” said PwC’s Jon Terry.
“But there is a significant question mark over this – history tells us negotiations can take considerably more time to complete than the Lithuanians have in their presidency.”