EU agrees new rules to foster venture investments

The revamped European Venture Capital Funds (EuVECA) and European Social Entrepreneurship Funds (EuSEF) regulations form part of the European Commission's drive to foster venture capital investments in the EU as part of the Capital Markets Union initiative.

The EuVECA and EuSEF regulations were adopted in 2013 and set up two new types of collective investment funds to make it easier and more attractive for investors to invest in unlisted SMEs – they notably allow fund managers to market these funds across the EU to professional and non-professional investors able to commit a minimum of €100,000.

The proposed changes extend the range of managers eligible to market and manage these funds to larger fund managers with assets under management of more than €500m. Furthermore, EuVECA funds will now be able to invest in small mid-cap businesses and SMEs listed on SME growth markets, in order to offer more diversification to investors. Finally, the three EU bodies have agreed to decrease the costs of these structures by explicitly prohibiting fees imposed by relevant authorities of host member states where no supervisory activity is performed, and simplifying the registration processes.

The text will follow ordinary legislative procedure before the final endorsements by the European Parliament and the Council of the EU, the Commission said in a statement.

Trade body Invest Europe welcomed the proposals, issuing a statement in which it praised the benefits of the changes. "We anticipate that the final text will be appropriate and proportionate for the venture capital industry's needs, to improve take-up of the EuVECA label and facilitate greater investment in Europe," the statement added.

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• Topics
• Regulation
• Venture
• Venture
• Invest Europe