Impending legal changes that are being constructed by extremely zealous and enthusiastic European (EU) regulators are going to have profound and unfavourable outcomes to the EU investment industry, says a senior corporate counsel member at a major law firm.
The new EU regulation changes are being generated at enormous speed and while it is terribly tempting and easy to quote to you individual articles and rules of draft legislations, at end of it I am not sure how much more wiser you will be, says Peter Richards-Carpenter, Senior Counsel for Corporates at Fried, Frank, Harris, Shriver & Jacobson in London, UK, speaking at the NEMA conference in Dubrovnik, Croatia.
The general point I want to make is that thanks to the zeal and insatiable enthusiasm of politicians of ‘unfailing regulators’, over the next two years we may well be heading most serious technical hitch in the EU investment industry from over the 30 years.
I use the term technical hitch deliberately, not to be provocative but unless there is a dramatic change of heart, which is possible, there are three possible outcomes that could profoundly affect the EU investment industry and custodians, added Richards-Carpenter.
The first outcome, which Richards-Carpenter says is the least likely is that there could be a dramatic increase in cost of custody services and significant decrease in quality of services.
However, the second and a far worse outcome and is far more likely is that if the present regulatory direction doesnt change, there could be a severe disruption in services and reduction in competition, says Richards-Carpenter.
Moreover, Richards-Carpenter says that there could be major political rows as well concerning sub-custody and fund administration.
Please click here for all coverage of the NEMA conference in Dubrovnik, Croatia this week with Global Custodian.
(LB)