The Investment Management Association (IMA) has urged the European Securities and Markets Authority (ESMA) to adopt a less prescriptive approach to alternative investment funds.
The IMA has outlined two main concerns regarding ESMA’s draft proposals, namely that an alternative investment fund will not be allowed to delegate both portfolio and risk management simultaneously and an Alternative Investment Fund Manager (AIFM) may not be allowed to hold a Mifid licence.
Julie Patterson, director of authorised funds and tax at the IMA, says: “There is much in the ESMA draft guidelines that is helpful and sensible. But, a less prescriptive approach is needed in some areas.
“ESMA appears to be restricting the ability of the manager to delegate investment management and risk management. This is common among many types of AIF and should not be constrained.”
“Also, there is some ambiguity about whether Mifid-authorised firms can also be alternative investment fund managers or whether they must first relinquish their Mifid licence. This issue needs clarity.”