The rules on pay in the Alternative Investment Fund Managers Directive (AIFMD) are deemed to be the most damaging among a range of regulations in Europe and North America.
More than half of alternative asset managers (56%) surveyed by Preqin and State Street said the remuneration provisions of the directive have had a negative impact on the industry.
In contrast, the much-derided Foreign Account Tax Compliance Act was deemed to have had a negative impact by only 40% of the 400 private equity, hedge and real estate fund managers in North America, Europe and Asia.
European managers are feeling the effects of increasing regulatory scrutiny more intensely than their peers elsewhere. Half the European alternative managers surveyed said regulation was a top challenge, compared to 35% in North America and 26% in Asia.
It has not all been bad news, though. Nearly half of hedge fund managers in the US (45%) said they expect the relaxing of the ban on hedge fund advertising in the US to have a positive effect.
“The regulatory landscape is moving at such a pace that it is extremely challenging to keep up,” says Sven Kasper, responsible for regulatory, industry and government affairs at State Street in Europe, the Middle East and Asia. “But whilst it is difficult and resource intense, staying close to these regulatory changes is beneficial as they provide new opportunities and possible competitive advantages through the early identification of new trends and products and the early adjustment of business models.”
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