The European Parliament and Council have given final approval to the Venture Capital Regulation, creating an effective EU-wide venture capital fund regime including an EU passport. The overall objective is to foster the growth of small and medium-sized enterprises by improving their access to finance through the establishment of an EU-wide passport for managers of venture capital funds and relating to the marketing of their funds. The Regulation will enter into force 20 days after its publication in the Official Journal of the European Union, which is expected to be sometime in the next few months.
The Regulation introduces uniform requirements for the managers of collective investment undertakings that want to operate under the E.U.-wide passport. There are requirements concerning the investment portfolio, investment techniques and eligible undertakings that a qualifying fund may target. The Regulation also sets forth uniform rules on which categories of investors in a European fund may target and on the internal organization deployed by managers that market such funds. Internal Market Commissioner Michel Barnier envisions that identical rules across the E.U. will help create a level playing field for all market participants.