Speaking to International Adviser at the industry body’s annual conference in Luxembourg on Tuesday, Agnes denied reports that international financial centres including France, Ireland and Luxembourg are competing to lure in British investment companies in the run up to Brexit by offering sweetheart deals.
“There were some articles in the press recently about fund domiciles, suggesting a race to the bottom when it comes to attracting financial players to places like France, Luxembourg or Ireland.
“Ireland and Luxembourg would be natural choices when it comes to keeping the EU passport.
“If players would like to come to Luxembourg because they need a solution in view of Brexit to remain or to keep their access to the European markets they are obviously welcome to come like everybody else but within the same set of rules,” she said.
"What we obviously cannot have is a situation where we embark on regulatory competition, supervisory competition and where we undermine the robust standard of rule making and supervision."
M&G move
The UK is the second largest promoter of Ucits funds in the world after the US and the third largest in terms of Ucits assets under management which as of 30 September 2016 totalled €1.04bn (£0.86bn, $1.07bn)
Earlier this month, London-headquartered asset manager M&G investments announced that it plans to set up a management company in Luxembourg, ending months of speculation that it might establish part of its business in Dublin.
Agnes said that should UK investment companies choose to set up in the Grand Duchy, which is one of the three official capital of the European Union alongside Brussels and Strasbourg than they “cannot just create an empty shell”.
“If they do move here, there is a minimum of substance required. You cannot just create an empty shell but key functions must be based here. You could not do this before Brexit, probably not after Brexit and not now in view of Brexit,” she said.
Regulatory competition
Her remarks were in response to a speech made by Steven Maijoor, chair of the European Securities and Markets Authority (Esma), at the conference earlier in the day where he warned financial centres across Europe not to engage in regulatory and supervisory arbitrage in a bid to attract UK-based financial services companies.
“I fully understand that financial centres across the EU 27 [countries] try to make themselves attractive for the UK market participants that they try to be efficient and try to be fast but what we obviously cannot have is a situation where we embark on regulatory competition, supervisory competition and where we undermine the robust standard of rule making and supervision,” he said.
