The European Venture Capital Association, the trade body that represents private equity’s interests at a pan-European level, has voiced its concerns about the “witch-hunt” currently being pursued by opponents of the industry.
EVCA was ostensibly commenting on the UK Financial Services Authority’s discussion paper on private equity, which was published last November and ended its consultation phase this week.
EVCA expressed reservations about the paper, while accepting that it “is well structured and presents a generally accurate description of the industry”. The trade body said the paper focuses on “a limited number of very large transactions”, which are not necessarily representative of the industry as a whole. It stressed that any regulatory changes needed to be based on “evidence-based research” and take into consideration the “important differentiators of the asset class”.
EVCA secretary-general Javier Echarri said his organisation was “fully supportive of open debate”, saying that its job was to “ensure that the industry’s collective voice is heard by policymakers and regulators across the EU. However, he urged caution: “We should steer away from the current witch-hunt pursued by some groups” – presumably a reference to recent trade union opposition.
Along similar lines, EVCA welcomed news that the Party of European Socialists, a political group in the European Parliament, plans to organise a debate on private equity and hedge funds. Echarri said it was “an opportunity to address misconceptions surrounding the industry.” However, he said the industry had a “very positive story to tell”, particularly since its “standards [are] the most advanced of any alternative asset class.”