Commission working paper launches consultation on a new European regime for venture capital
UPDATE 8 December 2011: The European Commission has now published its proposals for this European Venture Capital Fund passport, as we discuss in this post.
The European Commission Internal Market and Services Directorate General published on 15 June 2011 a staff working paper (the Paper) suggesting the creation of an EU-wide “passport” for venture capital funds. This passport would, as described in the accompanying press release, enable venture capital funds:
“to raise capital freely throughout the EU from professional investors and invest in innovative SMEs. Once the passport had been obtained (upon registration in one Member State), the fund manager could then operate throughout the EU without having to register in each Member State where it wanted to raise capital…”.
The Paper can be read here. The Paper:
- describes the decline in the amount invested by European venture capital funds since the financial crisis;
- notes the European Commission communication in April 2011 acknowledging the importance of venture capital funding;
- discusses why the recently adopted Alternative Investment Fund Managers Directive (AIFMD) “does not always appear to the ideal instrument” for the promotion of the cross-border venture capital activity;
- sets out the suggested elements of how an EU passport and supporting European legislative regime would operate; and
- starts a consultation period that runs until 10 August 2011.
For a summary of the AIFMD, see this post.
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