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Eversheds comment: Proposed extension to EU bankers' bonus cap will cause alarm among London fund managers

  • United Kingdom

    21-03-2013

    Commenting on proposals to extend the cap on bankers' bonuses across the EU to fund managers, Paul Fontes, partner at global law firm Eversheds, says:

    “The extension of the proposed bonus cap to managers of UCITS funds is extremely worrying and, if implemented, may see star fund managers look to relocate from London and manage non-UCITS funds. That potentially deprives European retail investors from being able to access the best managers. It is difficult to see what the rationale is for this proposal given that fund managers, unlike the major banks, do not benefit from an implicit guarantee from the government and their activities were not at the root of the financial crisis. It will also be interesting to see how such a rule can be applied to an industry where some firms operate as partnerships and the fund managers are remunerated by way of profit share rather than salaries and bonuses.”

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