Improved integration is essential to delivering the Savings and Investments Union and strengthening the EU’s global competitiveness.
Brussels, Belgium – MFA submitted recommendations to the European Commission (EC) to better integrate EU capital markets in a letter submitted today. The proposed reforms would improve regulatory alignment both across member states and with other key jurisdictions, enhance capital formation, and support a more globally competitive EU financial system.
“Integrated and efficient capital markets are the foundation necessary to deliver a successful Savings and Investments Union,” said Jillien Flores, MFA Chief Advocacy Officer. “Greater integration will lower costs, enhance cross-border investment, and make the EU a more attractive destination for global capital. If adopted, these reforms would allow alternative investment funds to operate more efficiently across borders and deliver better outcomes for their investors, including pension funds and foundations.”
The letter outlines how duplicative reporting, inconsistent member state rules, and disproportionate regulatory burdens have prevented EU capital markets from fully integrating. These barriers hinder Alternative Investment Fund Managers’ (AIFMs) efforts to scale their operations across the EU, limiting their ability to provide capital, liquidity, and risk management to the EU market. Addressing these issues is essential to delivering on the Commission’s ambition for a true Savings and Investments Union.
MFA’s specific recommendations are to:
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Tailor regulations based on fund size to reduce barriers and support the growth of smaller AIFMs
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Align short sale and derivatives reporting rules more closely with the UK and U.S. to reduce fragmentation and compliance costs
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Harmonise AIFM rules across member states and allow greater reliance on home-country authorisations, including for U.S. and UK AIFMs
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Return Annex IV reporting to its original purpose of monitoring for systemic risk, and coordinate revisions with changes to Form PF in the U.S.
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Promote innovation in emerging technologies like tokenisation and distributed ledger technology to modernise EU markets
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Clarify how EU marketing rules apply to non-EU fund managers to improve cross-border capital flows
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Focus supervisory oversight on higher-risk activities
Read the full letter here.
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About the global alternative asset management industry
The global alternative asset management industry — including hedge funds, private credit funds, and hybrid funds — serves thousands of public and private pension funds, charitable endowments, foundations, and other global institutional investors. The industry provides portfolio diversification and risk-adjusted returns to help meet their funding obligations and return targets throughout the economic cycle.
About MFA
Managed Funds Association (MFA), based in Washington, D.C., New York City, Brussels, and London, represents the global alternative asset management industry. MFA’s mission is to advance the ability of alternative asset managers to raise capital, invest it, and generate returns for their beneficiaries. MFA advocates on behalf of its membership and convenes stakeholders to address global regulatory, operational, and business issues. MFA has more than 180 fund manager members, including traditional hedge funds, private credit funds, and hybrid funds, that employ a diverse set of investment strategies. Member firms help pension plans, university endowments, charitable foundations, and other institutional investors diversify their investments, manage risk, and generate attractive returns throughout the economic cycle.
