The European Commission has launched a consultation into cross-border distribution of funds across the EU’s single market.
The consultation seeks to assess the main barriers in the blocking the distribution of UCITS and Alternative Investment Funds in the EUR13 trillion cross-border fund market. The commission said it aims to look into the market to help it operate more efficiently, particularly for smaller funds.
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The consultation, which will run for four months, will take feedback from fund managers, investors, consumer groups, as well as those who market and sell funds on impediments in the way of to cross-border distribution.
The hurdles could include marketing rules, administrative arrangements by host countries, regulatory fees or notification rules, among others.
Commissioner for financial services, financial stability and capital markets union Jonathan Hill said: "One of the benefits of the single market is that investment funds should be able to do business easily across borders. But at the moment, smaller fund managers are telling us they face challenges when trying to sell their products in different countries. So I want to use this consultation to flush out what the main barriers are to funds operating across borders, so that we can work out how best to overcome them.
"I want the passport for fund managers to works as well as possible so that we can build a system where investors have more choice and better value, and where investment funds can do business more easily."
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By GlobalDataThe move was welcomed by Investment Association interim CEO Guy Sears.
"Capital Markets Union was born from Commissioner Hill’s bold, broad vision to encourage growth and investment across the EU. It will be implemented through serious, detailed work on areas of friction and inefficiency. This call for evidence – looking at cross-border markets for investment funds – is a key component of that detailed work. The UCITS regime is already highly successful. Get this work right and people saving into investments should have easier access to these great products," Sears said.
