Q&A: Negotiating with Brussels

What is the biggest policy challenge that EVCA currently faces?

The big challenge for the industry is still the implementation of the Alternative Investment Fund Managers (AIFM) directive. The Brussels end of that has died down compared to the heady days of 2009-2010 when the European Private Equity and Venture Capital Association (EVCA) was doing a lot more negotiation. But we will still want to follow very closely what happens with the directive’s implementation at the national level. Not least because the review of the directive will be upon us before we know it. We must monitor and assess the market impact and the actual experience of the industry in dealing with the directive so we are well positioned when the European Commission starts reassessing the directive. If we are not providing that, then nobody else will.

How will you address such a challenge?

We have got lots of ways in which we approach this. The day to day experience of the national associations is critical. Understanding how it’s being implemented in country A, how it’s being implemented in country B. So we have got all of their day to day experience we can draw on, in addition to the direct access to our members who are wrestling with the specific provisions. You can get some powerful real world examples from members to what is working and what isn’t. The EVCA may well want to do some more structured data collection, data analysis on the impact of the directive to bring the whole story together.
 
After the AIFM directive is fully implemented, what is next on the EVCA’s agenda?

We now have sector specific legislation on the statute book, and during the implementation phase of those rules, we will start to look at investor regulations, for instance Solvency II and the proposed revisions to the IORP [Institutions for occupational retirement provision] directive. We need to make sure the treatment of private equity is fair and is characterized correctly. This is going to be a big issue for us going forward.

Michael Collins

Looking beyond that we are about to enter in to an interesting period in the EU because we are getting towards the end of European Commission and European Parliament terms. There will be a lot changes in the European Parliament, and a lot of changes in the Commission as well, so that creates new challenges and new opportunities for the EVCA. We will be trying to make sure that the policy makers responsible for the next four or five years understand what private equity and venture capital are, and are sensitive to what the industry needs and doesn’t need from regulatory and fiscal policy.
 
How will you educate the new policy makers?

There is going to be a big turnover of policy makers and it is difficult to predict how many new MEPs [members of European Parliament] there will be this time next year, but a safe assumption is that 25-30 percent of MEPs will be new. So some of these people will come in and know something about private equity and some won’t. But it really just involves sitting down and talking to these policy makers.

We have a range of different committees, working groups and task forces that can really get in to the details of how certain polices affect the industry. And so our job as the secretariat is to marshal all of those resources, bring them all together with structure and direction. We need to make sure that the policy makers are aware of the key industry questions that need to be answered.