European fund managers seek united voice on EU laws

The London-based European Asset Management Association (EAMA) and Brussels-based FEFSI – the European Federation of Investment Funds and Companies – said today a joint working party will report before the end of the year about ways of achieving this aim. EAMA represents the fund management trade associations of the UK, France, Italy, Spain and Ireland and 29 asset management companies. FEFSI is an umbrella organisation for the investment fund industry in the 15 nations of the EU, as well as the Czech Republic, Hungary, Poland, Norway and Switzerland.

The European Commission wants to apply Cad 3 to all banks and investment firms in the EU from late 2006 in parallel with the complex Basel II bank capital adequacy accord. Cad 3 is closely modelled on the risk-based Basel II accord, which will determine how much of their assets banks must set aside as a protective cushion to absorb unexpected losses from the hazards of banking, including credit, market and operational risks.

EAMA said today there must be a separate recognition of the asset management industry in Europe from both a regulatory and employment perspective. “The business of managing investments – however the end product is packaged – needs distinctive regulation and representation. Asset managers are not banks or insurers,” EAMA said.

EAMA has criticised as “deeply flawed” the Cad 3 and Basel II proposals for capital charges against operational risks, such as fraud, technology failure and trade settlement errors, in the fund management businesses of banks. The organisation believes such charges could make the European asset management industry uncompetitive with other countries, most notably the US.

The European Commission said in July this year that it accepted that the Basel II operational risk requirements would be disproportionate to the risks faced by certain types of lower-risk investment firms. The commission said it is considering how best to modify its op risk proposals in the light of that recognition.

As well as Cad 3, EAMA and FEFSI would seek to present a united front on other EU matters, including the pensions directive, the market abuse directive, the collateral directive and the investment services directive.

David Keefe

For similar articles please visit - an indispensable source of news, comment and analysis on the development of the Basel II accord and banking supervision. The site contains a searchable archive of news, articles and technical papers, and a free monthly e-mail summary. Click here for a free trial.

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact or view our subscription options here:

You are currently unable to copy this content. Please contact to find out more.

You need to sign in to use this feature. If you don’t have a account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here