US fund managers don’t want passports

Author: Lizzie Meager | Published: 16 Feb 2016

Since the Alternative Investment Fund Managers Directive (AIFMD) was fully implemented in 2011 the intention has been to extend the passport scheme to non-EU fund managers.

But in the absence of clarity over what a new passport scheme would look like and how it would work for funds domiciled outside of the bloc, counsel say some AIFs are just not interested in joining it.

In a letter published by the European Securities and Markets Association (Esma) in January, the European Commission said it would not grant non-EU jurisdictions passports to jurisdictions, including the US and Hong Kong, without further assessment by Esma. Counsel say the US is the sticking point in that consideration.

"There’s two tracks to this story," said Leonard Ng, a partner at Sidley Austin in London. "There’s the official US Treasury position that it’s a bit of a slap in the face, and then the view of...