ESMA chairman, Steven Maijoor, told the European Parliament that the regulatory authority would also begin making preparations for the significant role it intends to play in the functioning of the planned passporting system and the strengthened supervisory cooperation that will be needed.
Meanwhile ESMA is continuing its assessment of Hong Kong, Singapore and the US with a view to reaching a definitive conclusion soon on whether to extend the passport to those countries.
Maijoor made the comments to the Economic and Monetary Affairs Committee of the European Parliament on Tuesday.
It follow’s ESMA’s recommendation in July that the EU grant access Jersey, Guernsey and Switzerland to a Europe-wide passport under the directive, which came into force in July 2011 and covers the management, administration and marketing of alternative investment funds.
The new list of countries were selected using the same criteria as for the first set of recommendations.
Passporting appeal
If granted, an AIFMD passport would allow managers of alternative investment funds (AIFs) from non-EU countries access to a much wider base of investors for their products. Typically AIFs include hedge funds, private equity funds, retail investment funds, investment companies and real estate funds.
Without the passport, AIF managers are required to either set up operation in an EU jurisdication, such as Dublin or Luxembourg, which can be expensive or utilise a system of national private placement regimes (NPPRs) across Europe.
Maijoor said he was conscious that following ESMA’s recommendation in July other non-EU jurisdictions were left wondering about the consequences for them of their jurisdiction not having been assessed positively yet.
Plans outlined
As a result he told the EU parliamentarians: “We see three key areas on which further work by ESMA is required in the short term.
“First, we will continue our assessment of Hong Kong, Singapore and the US with a view to reaching a definitive conclusion on whether to extend the passport to those countries.
“Secondly, we will start to assess a second group of non-EU countries, namely Australia, Canada, Japan, the Cayman Islands, the Isle of Man and Bermuda. These countries were selected using the same criteria as for the first set of advice.
“Thirdly, we will focus on putting in place the extensive framework foreseen by the co-legislators in case the passport is indeed extended to one or more non-EU countries. This last element includes making preparations for the significant role for ESMA in the functioning of the passporting system and the strengthened supervisory cooperation that will be crucial to its success.”
