The vote, in Strasbourg, was 33 in favour to 11 against, with three abstentions.
As reported here yesterday, EU ministers will have their turn to vote on the so-called Alternative Investment Fund Managers (AIFM) directive later on today, when they are also expected to approve it. A final vote, by the full EU Parliament, will take place in July.
US, UK against
Many in the UK investment fund and pension fund industries have argued that the regulations would drive up costs, reduce investor choice and act as a barrier to the European market by non-European (“third country”) fund houses.
Javer Echarri, secretary general of the Brussels-based European Private Equity and Venture Capital Association, said in a statement that his organisation had “fresh hope” following the vote that “constructive debate on the flow of funds between the EU and third countries” would now take place.
"But this legislation still poses a grave threat to innovative companies backed by venture capital, “ he added.
“Unwarranted disclosure requirements would leave ideas-fuelled [small businesses] at the mercy of unfair and damaging competition. Why Parliamentarians wish to punish SMEs remains the greatest mystery of the post-crisis regulatory response.
“A solution that balances cross-border transparency and cooperation with the need for investor choice and finance for European business, is an absolute priority. ”
Other critics of the proposed directive include the UK’s Investment Management Association, National Association of Pension Funds and Alternative Investment Management Association.
US Treasury Secretary Tim Geithner has also expressed concern that it would "discriminate" against US firms.
However, most other European countries, with the exception of the Czech Republic, broadly support the directive because, they say, it could help to prevent a future financial crisis by forcing companies to meet high standards of transparency and to retain greater capital reserves than are now required.
