The European Parliament’s vote to cap bonuses in the asset-management industry could affect two- thirds of senior fund managers in the U.K., U.S. funds in Europe and hedge funds open to small investors.
Bloomberg reports that bonuses should not exceed base salaries for managers of mutual funds regulated by the European Union, known as UCITS, European lawmakers in the economic and monetary affairs committee voted Thursday.
The rules would cover $6.5 trillion of assets in UCITS, which include funds managed outside Europe and some linked to hedge-fund strategies such as John Paulson’s New York-based Paulson & Co. and Och-Ziff Capital Management Group LLC. (OZM).
'If the final rules are even close to what has been agreed today, then this will fundamentally change the way asset managers are paid', said Jon Terry, a partner at PricewaterhouseCoopers LLC. Asset managers 'are now facing the toughest pay rules across the whole of the financial-services sector'.
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