ECB joins chorus attacking EU hedge fund plans

EOObserver.com reports that the European Central Bank has added its name to the extensive list of critics of EU plans to clamp down on the hedge fund sector, saying over-regulation could drive the industry out of Europe.

The European Commission came forward with a draft directive before the summer to improve regulation of the hedge fund and private equity sectors, with the proposals currently being studied by the European Parliament and member states.

The commission plans call for the registration and regulation of all "alternative investment funds".

The funds would be obliged to disclose information on the types of assets it invests in as well as provide details on their use of short selling, one of the tactics blamed for exacerbating the financial crisis.

Non-EU fund managers would also be obliged to comply with the rules if they wished to sell their products within the bloc.

But consensus is growing amongst bankers and EU officials that the commission's one-size-fits-all' approach for all types of funds is too simplistic and needs alteration.

Read the entire article here: http://euobserver.com/9/28875/?rk=1