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October 13, 2013 5:36 am
Lithuania has made a surprise move to accelerate the Ucits V directive, raising the likelihood that the controversial measure will not include bonus caps for fund managers or restrictions on lucrative performance fees.
In July, the European parliament surprised many observers by rejecting, by 348 votes to 341, a proposal to limit bonuses to 100 per cent of fixed salary and outlaw performance fees for Ucits funds.
Given the tightness of the vote, many believed it could be overturned by the parliament formed after EU-wide elections in May 2014.
However, a decision by Lithuania, the current holder of the EU’s rotating presidency, to schedule a working group on Ucits V for October 21 has raised expectations that a draft directive could be finalised by the spring, meaning the new intake of MEPs could not overturn it.
“The move is unexpected. Lithuania said it would prioritise banking and financial stability-related issues and this was not in the top half dozen,” said a source with knowledge of the matter, who believed the European Council would only need two sessions at most to agree its version of the directive.
The only remaining obstacle might stem from the coalition talks in the wake of September’s German election.
Sven Giegold, a German Green MEP, spearheaded the abortive clampdown on fund managers’ pay.
“There is no division on the council. Luxembourg and Ireland support the UK [in opposing bonus caps and restrictions on performance fees] and Germany probably will, unless the [centre-left] SPD or Greens get into a coalition quickly,” said the source.
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