Efama

With the European Commission confirming on Tuesday that the Level 2 Regulatory Technical Standards (RTS) for the revised European Long-Term Investment Funds (Eltifs) regime are on track, the alternatives industry is shifting its focus towards overcoming operation challenges such as on co-investments, liquidity management and handling different tax regimes across the EU market.

How non-EU investors drive growth in European funds and why vigilance remains crucial in the European investment landscape.

Asset managers are expressing concerns over the European Commission’s lack of a clear definition for “value for money,” arguing its subjective nature complicates the assessment of investment service costs amidst new regulatory pressures.

The current approach to the EU’s retail investment strategy may not adequately address broader issues such as the retirement savings gap, reflecting a need for a more holistic approach to financial education and pension policies, a leading European industry representative argues.

Representatives of the European asset management industry believe that lawmakers in Brussels need to step up their efforts to make sure that new voting rules for SMEs and scale-up companies strike a balance between the needs of investors and issuers. The proposal is also of importance to private equity firms investing in these companies.

European fund and asset management association Efama has raised significant concerns over the proposed regulatory technical standards and implementing technical standards for the Digital Operational Resilience Act, the cybersecurity plan known as Dora, criticising the measures as excessively broad and disproportionate. Efama, whose Luxembourg member is Alfi, the Association of the Luxembourg Fund Industry,  argues that a “one size fits all” approach will be inordinately burdensome, particularly for asset management companies. 

The European Fund and Asset Management Association (Efama) has declared that the European investment fund sector is not capable of undermining financial stability to the extent that it results in systemic risks.

During a annual general meeting in Amsterdam on Friday, Sandro Pierri, CEO of BNP Paribas Asset Management, was elected as the President of European fund and asset management association EFAMA for a two-year term until June 2025.

In a significant market trend, European fund investors are increasingly redirecting their investments towards larger, passively managed mutual funds and ETFs, at the expense of actively managed smaller ones. This strategic shift has ignited a sustained downward pressure on costs across various fund types and strategies, according to the latest insights unveiled on Monday by the prominent European fund sector group Efama.

Europe’s fund and asset management organisation Efama, active in the development of the updated European long-term investment fund, expressed  strong optimism this week about the updated vehicle’s interest to both professional and retail investors and its ability to fulfill its Capital Market Union aspirations.

Despite early questioning of its ability to provide sufficient liquidity to attract retail investors, Efama’s expert detailed how the legislation provides several tools that afford liquidity solutions.