ESMA is consulting on future technical advice it has to provide to the European Commission on the implementing measures of the Regulations on European Venture Capital Funds (EuVECA) and European Social Entrepreneurship Funds (EuSEF).

The EuVECA and EuSEF Regulations aim to make it easier for venture capitalists and social entrepreneurs, managing assets under the AIFMD €500m threshold, to raise funds across Europe without the requirement to comply with the full AIFMD regime.  The key elements of the Regulations provide for an EU brand for EuVECA and EuSEFS and the introduction of a European marketing passport.  The two sets of Regulations are complementary although the range of eligible financing tools/investments in the EuSEF Regulation is wider than those available for venture capital funds under the EuVECA Regulation.

The paper was published on 26 September 2014 and focusses on five principal issues.  Only one (the  third) applies to EuVECA managers and this deals with advice on the conflicts of interest of EuVECA Managers.  The other four issues are relevant to EuSEF Managers.  The first deals with the advice on the types of goods and services, methods of production for goods and services and financial support embodying a social objective.  The second deals with the advice on the conflicts of interest of EuSEF managers.  The fourth deals with the advice on the methods of the measurement of the social impact.  The fifth deals with the advice on the information that EuSEF managers should provide to investors.

ESMA will consider the feedback it receives to this consultation with a view to submitting the technical advice to the European Commission before the end of April 2015.

The consultation closes on 10 December, 2014.