Obstacle remover

In its efforts to create a harmonized European private equity market, the European Commission is leveraging the expertise of one of the industry’s leading legal experts. Daniela Weber-Rey, a partner in the Frankfurt office of Clifford Chance since 1989, has been appointed to the Commission’s Expert Group on Removing Obstacles to Cross-Border Investments.
In the context of the EU as a single market, the Commission argues that it is unsatisfactory that 75 percent of private equity investments are undertaken in the same country in which the management company is located and just 20 percent in other European countries. This happens, it maintains, because the EU has 25 separate tax and legal systems meaning that investors are dissuaded from making cross-border investments because of the complexity involved.
Weber-Rey has joined a group that will look at corporate and regulatory blockages to cross-border investments:
it will not explore taxation issues, which is the remit of a separate Expert Group. Weber-Rey’s group will meet three times to discuss existing frameworks and assess possible new approaches before submitting a final report to be published by the Commission in mid-2007.
As a member of the tax and legal committees of both the German and European private equity and venture capital associations, Weber-Rey believes she will be a valuable conduit between the industry and the Commission. “I can feed back developments within the Commission to the industry, while feeding into the Commission what the industry wants,” she says.
The ultimate aim of the Commission is to create a common pan-European fund structure, which can be used for private equity investments throughout the EU. Weber-Rey says it wants to create a situation where if member states do not adopt the single fund structure they will “find themselves at a competitive disadvantage to other member states, leading ultimately to what might be termed ‘natural convergence’.”