Businesses could be driven out of Europe because of hedge fund regulation, the European Central Bank (ECB) warns. The ECB reacts to the intentions from the European Commission to regulate hedge funds as the only region in the world. ECB is concerned that regulating funds in the EU but not anywhere else will give the funds incentives to go “country shopping" in order find the best place to be (with the least regulation). The paradoxical part of this argument is that funds can do this already... and many have decided that being in Europe is the best place to be, so why ruin a good thing?
The proposal from the European Commission covers all kinds of funds financing everything from creative entrepreneurs to big business. Driving these funds out of the European region and into the arms of more competitive countries will set back the European industry costing both wealth and jobs.
If the EU really was comitted to supporting productivity, research and innovation, eurocrats should maybe consider ways of easing administrative burdens for those driving progress and prosperity instead of finding ways of turning them away.