Sarkozy to block EU hedge fund legislation

French MEPs may veto the Alternative Fund Managers Directive (AIFMD) including a key provision for passporting of investment products, which would allow fund managers to sell products across Europe.

This could have a serious knock-on effect as 80% of the City's hedge funds operating across Europe are based in London. Last night, French negotiators would not give out details on their proposal for the new rules but suggested they were gathering support to block the legislation, The Telegraph reports. "This would be a profoundly protectionist move," says Andrew Barker, chief executive of the Alternative Investment Management Association. "The French proposal could be calamitous for European investors who could be prevented from investing in funds or managers outside the EU and no...