EU Alternative Asset Management Regulation

The present plan to regulate the alternative asset management industry in the EU suffers from a number of serious deficiencies: Number one is the lack of a definition of the problem that it is supposed to solve. If there is no problem it is quite tough to design a proper regulatory regime. As far as we can see, apart from the usual rant from social engineers to the left (but also the authoritarians on the right) of the political divide there has not been a convincing proof that hedge funds or private equity funds pose a serious problem to anyone individually or to 'society' in general. So we are left with a legislative 'free-for-all' that gives underemployed and overpaid bureaucrats that represent no one but themselves (and their prejudices) carte blanche to cook up more schemes to make it difficult for ordinary citizens to make a living. As there is no clearly defined problem in the first place it is impossible to pass judgement whether or not the proposed measures are appropriate - an ideal world for the legislators as no one can call them to account or do a cost-benefit analysis of the proposed legislation. (As if anyone would to that in Brussels or any other capital). On the most basic level a major criticism has to be that it is not sensible to regulate hedge funds and private equity funds in the same law. They are similar in nature but it takes a bit of experience to understand that they are two very different animals. We rest our case as it is impossible to convince the average EU bureaucrat that he is barking up the wrong tree. Better to prepare for the wholesale decampment of the alternative investing industry to friendlier shores!