Trio of regulators slam EC's hedge fund regulation plans

THE EUROPEAN Commission&rsquo;s (EC) proposals for regulation of the alternative investment industry are flawed, three of the world&rsquo;s top regulatory reformers said yesterday.<br /><br />Jacques de Larosi&egrave;re, author of the report behind the EC&rsquo;s plans for a pan-European regulatory system joined Financial Services Authority chairman Lord Turner and Conservative adviser Sir James Sassoon in criticising the EC&rsquo;s draft directive on the regulation of hedge funds and private equity.<br /><br />Speaking at a conference hosted by think-tank Business for New Europe, Delarosiere said he had &ldquo;some doubts on the wisdom of some aspects of the directive,&rdquo; such as leverage requirements, adding that &ldquo;private equity should be kept out of heavy regulation&rdquo;.<br /><br />Lord Turner said he was concerned that the alternative investment sector had become a &ldquo;target&rdquo;. <br /><br />And Conservative adviser Sir James Sassoon said: &ldquo;It&rsquo;s hard to find a kind word to say about a directive so disproportionate in scope, so protectionist in its effect and so poorly drafted.&rdquo;<br /><br />Business minister Lord Myners said he had received assurances from Sweden, which takes over the EU presidency on 1 July, that it would work with the UK to explain the merits of the alternative investment industry to European counterparts such as France.