MEP Advocates 'Light Handed' Regulatory Approach To Hedge Funds

by Robin Pilgrim, LawAndTax-News.com, London

14 October 2003

Scottish Conservative MEP, John Purvis is to submit a report to the European Parliament's Economic and Monetary Affairs Committee later this month proposing a "light-handed EU-wide regulatory regime" for the hedge fund industry, it emerged this week.

According to the UK media, Mr Purvis is expected in his report to urge the European investment industry to educate potential investors with regard to the risks of hedge fund investment, and to set a minimum investment level, lowering the limit as public understanding of the risky investment vehicles increases.

The Scottish MEP is also expected to encourage national financial watchdogs to develop effective ways of monitoring and controlling the extent of credit, operational, and management risk that the funds can bring to the international financial markets.

Mr Purvis has revealed that in addition to attracting smaller investors to the industry, he hopes that the promise of a light touch regulatory regime will tempt many hedge funds back from their offshore locations.

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