Capital Markets & Financial Regulation News – February 2016
“New financing opportunities for businesses”-Securities,Derivatives Sructured Finance,Corporate Governance
- European Long-Term Investment Funds
- European Social Entrepreneurship Fund
- European Venture Capital Funds
- Crowdfunding
- Possibilities for public funding and matched – public and private- financing
- Information Asymmetry: Local intermediaries to “bridge the gap”
Greece, as well as Europe, requires significant
volumes of new long term sustainable investment to
maintain and increase competitiveness. Currently,
loan-based finance dominates the market, while
alternatives to traditional methods of financing opportunities for businesses are
limited, contrary to the situation in the USA. This is
particularly true, when it comes to European Small
and Medium Sized Enterprises (SMEs), which, for
example, compared with the US, receive five times
less funding from capital markets.
In its new project, Capital Markets Union (CMU), part of the
Juncker’s Investment Plan and necessary complement to
the European Banking Union, the European Commission
recognizes broadly the need for promoting alternative
sources of funding for businesses, especially SMEs, placing
special emphasis on funds.
In this respect, the European Commission aimes at
facilitating the cross border provision of services for certain
categories of funds, by putting forward or/ and amending
legislative texts which regulate and establish “marketing
labels” for those funds, thus allowing them to “passport”
their investment services across Europe. ELTIFs, EuVECA,
EuSEF are indicative examples in this regard.
European Long-Term Investment Funds
The recent European Long-Term Investment Funds
(ELTIFs) regulation, applicable in Member States from 9
December 2015, will allow investors to put money into
companies and infrastructure projects for the long term, thus
increasing the amount of non-bank finance available to
companies in the EU. In particular, ELTIFs can invest in real
estate, intellectual property, unlisted SMEs, as well as listed
SMEs with a market capitalisation of less than EUR 500
million. Eligible assets must comprise at least 70% in
eligible long-term investments. Direct holdings of over EUR
10 Million in real assets such as energy, transport,
communication, education, health and so on are eligible
provided that they yield a predictable return
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