European Parliament lawmakers intend to delay their vote on capping fund manager bonuses as they continue to work out the details of the plan, according to reports.
Sven Giegold, the parliament’s lead lawmaker on the plan, told Bloomberg that legislators are looking at changes to draft measures already approved by the EU’s economic and monetary affairs committee. The proposed rules would prevent Ucits fund managers from earning bonuses worth more than their fixed pay.
Giegold says: “We are trying to figure out if a pro-European and cross-party compromise for waterproof consumer-protection rules in the area of managers remuneration and performance-fee regulations can be found.
“I asked for the postponement of the debate and vote of the Ucits V dossier in plenary in order to continue political negotiations.”
Asset management houses across Europe have expressed concern at the suggested bonus cap, noting that they go beyond the proposed restrictions on banker pay – that allow bonuses twice the size of salary to be paid – and arguing it will increase costs while creating bidding wars for the top-performing managers.
PricewaterhouseCoopers also says that UK fund management firms are like to be disproportionately hit by any bonus cap rules, as bonuses tend to make up a greater proportion of pay for British fund managers.