A group formed by the European Commission to study hedge funds is urging it to find ways to make sure Euro HF managers are excluded from any U.S. Securities and Exchange Commission regulations. In a report released Tuesday, the group pointed out, as others have before it, that HFs already answer to their local authorities and that the “light-touch” regulation among the various countries appears to be sufficient for now. The group had a couple of surprises in its report. It recommended that the EC prevent access to HFs for investors they may not be suitable for, suggesting a minimum investment of €50,000 (US$64,000), while urging EC members to lift barriers to make HFs available to a broader range of institutional investors. In addition, the study calls for allowing funds from different EC member states to merge without having to comply with burdensome conditions, centralizing management of assets so funds could achieve economies of scale, and removing a “head office” principle, that requires member states to have a principle, permanent office in a country where the fund operates.
