Alfi stresses importance of Esma in Commission's CMU proposals

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Luxembourg’s fund association Alfi has responded to a recent European Commission proposal for the Capital Markets Union Initiative, stressing the importance of Esma in harmonising capital market rules.

The European Commission’s proposals to amend the Ucits and AIFM Directives were published on Monday and sparked criticism among others by German industry organisation BVI. Thomas Richter, CEO of the BVI called the proposals “disappointing” and warned of handing regulatory power to Esma, rather than to local regulators.

In contrast, Alfi responded by stating that it supported an approach where Esma would provide guidelines and examples to ensure a common implementation of CMU rules across the EU.

At the same time, Alfi argued that “the proposal could have been given greater scope and effectiveness in particular with regards to the notions of marketing and pre-marketing which have not been extended beyond the AIFM Directive context.”

It also highlighted that the proposals provided insufficient levels of harmonisation to effectively remove barriers to cross-border fund distribution and that the new framework proposed for pre-marketing and the de-registration of funds remained too restrictive.

These criticisms align with the feedback from German industry organisation BVI which also argued that the proposals for de-registering funds in a certain market would represent an obstacle to cross-border fund distribution.

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