France could drop its objections to a law which would control hedge funds operating in the EU, in exchange for concessions from London, according to Reuters. The proposed law has upset US hedge funds and private equity firms because it would restrict how they operate within the EU.
(Reuters) – France is preparing to drop objections to a central part of a law to control hedge funds in exchange for concessions from London, a senior diplomat said, moving to end a row that threatened to harm relations with Washington.
The latest twist in a tug-of-war between London and Paris over the future of the secretive industry is likely to see both sides claim victory in their tussle over new controls for hedge funds and private equity.
As talks entered their final leg, France demanded Britain surrender more policing power to a European watchdog allowing it monitor foreign funds. Paris, in return, would agree to let such funds qualify for a licence to work across the bloc’s 27 countries.
“There are real signs of both sides coming closer together,” said the EU diplomat, who is familiar with France’s thinking, commenting on a deal which would likely postpone the introduction of the EU-licence scheme.
(Additional reporting by Daniel Flynn in Paris; editing by John Stonestreet)