06/06/2012
AFG speaks out against competitive distortions
The French asset management sector is going to face intensified competition, on the one hand from the “consumer-oriented” financial industry (banks and insurers) and market-oriented banks (investment and financial banks), due to new regulatory requirements, such as Basel III and Solvency II, which these competitors will be required to comply with, and on the other hand from management or fund domicile centres in Europe and internationally, the French financial management association (AFG) warns in an editorial in its annual report, published this Tuesday.In order to remain competitive, the French asset management sector needs balanced European regulation including packaged retail investment products (PRIPs), and an application of European directives by various countries “with strict competitive equality.”In addition, the AFG recommends that European react even more forcefully than it is now to the US authorities on the subject of regulations outside European territory, such as the Dodd-Frank Act, the Volcker Rule and FATCA, which will be likely to affect French asset management firms. The AFG warns that Europe will have to learn how use legislation as a competitive weapon on behalf of industries under its control.The association has also called for encouragement of long-term savings with regulatory and tax incentives. “The longer-term savings are and the more they are invested in equities, the lower taxes should be.”
