The European Commission has published a proposal to amend two European Parliament and Council Regulations on European venture capital funds (EuVECA) and social entrepreneurship funds (EuSEF), as part of the capital markets union (CMU) action plan (see http://bit.ly/2aaifkz). These funds were set up to make it easier for investors to invest in small and medium-sized innovative companies. Following a consultation in September 2015, the Commission proposes to:
• extend the range of managers eligible to market and manage EuVECA and EuSEF funds to include larger fund managers, i.e. those with assets under management of more than €500m. Larger fund managers can provide economies of scale and trusted brands, offering benefits for investors who in turn can invest more for the ultimate benefit of venture capital and social enterprises;
• expand EuVECA eligible assets, to allow investment in small mid-caps, and SMEs listed on SME growth markets. This is expected to allow more companies to benefit from EuVECA investments and make investments more attractive through greater diversification of risk;
• decrease the costs explicitly prohibiting fees imposed by competent authorities of host member states, simplifying registration processes and determining the minimum capital to become manager.
As part of the wider CMU package to stimulate venture capital investments in the EU, a pan-European venture capital fund of funds will combine EU financial sources with greater volumes of private capital. This pan-European fund of funds should help to overcome market fragmentation and attract private investors to the EU venture capital asset class.
The European Commission has published a proposal to amend two European Parliament and Council Regulations on European venture capital funds (EuVECA) and social entrepreneurship funds (EuSEF), as part of the capital markets union (CMU) action plan (see http://bit.ly/2aaifkz). These funds were set up to make it easier for investors to invest in small and medium-sized innovative companies. Following a consultation in September 2015, the Commission proposes to:
• extend the range of managers eligible to market and manage EuVECA and EuSEF funds to include larger fund managers, i.e. those with assets under management of more than €500m. Larger fund managers can provide economies of scale and trusted brands, offering benefits for investors who in turn can invest more for the ultimate benefit of venture capital and social enterprises;
• expand EuVECA eligible assets, to allow investment in small mid-caps, and SMEs listed on SME growth markets. This is expected to allow more companies to benefit from EuVECA investments and make investments more attractive through greater diversification of risk;
• decrease the costs explicitly prohibiting fees imposed by competent authorities of host member states, simplifying registration processes and determining the minimum capital to become manager.
As part of the wider CMU package to stimulate venture capital investments in the EU, a pan-European venture capital fund of funds will combine EU financial sources with greater volumes of private capital. This pan-European fund of funds should help to overcome market fragmentation and attract private investors to the EU venture capital asset class.
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