• Without prejudice

    We all need to fight the ugly bigotry that’s made news recently, says Mandi Smallhorne.

  • Inside Labour

    The Davos extravaganza is slick PR and no UN-style institution, says Terry Bell.

  • 2015 Gadget preview

    Arthur Goldstuck presents gadgets to connect 2015 to the past and future.

All data is delayed
Loading...
See More

New rules to hurt SA private equity

May 27 2010 10:36 Nellie Brand-Jonker

Related Articles

New chair for Equity Commission

Higher profits for private equity

Signs of life in private equity

Private investors more cagey than experts

Higher profits for private equity

US private equity fund eyes SA

 
Cape Town - South Africa's private equity funds could be hit by the European Union's new guidelines governing alternative investment managers.

JP Fourie, CEO of the South African Venture Capital Association (Savca), said the association was deeply concerned over the consequences of the new rules on South African private equity funds.

Private equity funds that invest in unlisted companies are regarded as an alternative asset class for investors.
The guidelines for governing alternative investment managers will ensure that private equity funds outside Europe cannot raise money there. The guidelines are also aimed at hedge funds.

According to Fourie, Savca on Monday met National Treasury to persuade government to have the issue discussed at the June G20 summit.
Sarah Alexander, president of the Emerging Markets Private Equity Association, recently also said at a local conference that the envisaged legislation would have a "very negative" impact on private equity in emerging markets.

The guidelines will make it difficult for an emerging market fund manager to access capital in Europe without significant additional expense and an administrative burden, she explained.

Fourie said that it also meant that European investors would not find it easy to invest in South African private equity funds.
They would not be able to give money to a fund that was not regulated in terms of the EU standards, he said.

Fourie noted that many of the institutions that gave money to private equity funds in South Africa were European government development finance organisations. They made these investments specifically because the private equity funds in turn invested in companies working towards development objectives. This funding would now dry up and backers could no longer invest in Africa and other developing countries.

Last year the EU announced the draft guidelines to regulate alternative investment managers, which were designed to avoid systemic risk and protect investors through greater transparency and other measures.

- Sake24.com

For business news in Afrikaans, go to www.Sake24.com.
private equity

NEXT ON FIN24X

 

Latest Articles

Tax-free saving accounts are coming Read More...
Which generator is right for you? Read More...
5 top tips to help you save on your next grocery bill Read More...
Thinking of going solar? Here's what you need to know Read More...
 
 

Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Add your comment
Comment 0 characters remaining
 

Company Snapshot

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...
Loading...