Editing Hedge fund (section)

===Europe===
Within the European Union (EU), hedge funds are primarily regulated through their managers.<ref name=Coggan/> In the United Kingdom, where 80% of Europe's hedge funds are based,<ref>{{cite news |url=https://www.bbc.co.uk/news/business-11577887 |title=EU finance ministers agree new hedge fund curbs |last1=Shore |first1=Ben |date=19 October 2010 |website=BBC News Business |access-date=18 July 2013 |archive-url=https://web.archive.org/web/20110720083738/http://www.bbc.co.uk/news/business-11577887 |archive-date=20 July 2011 |url-status=live |df=dmy-all }}</ref> hedge fund managers are required to be authorised and regulated by the [[Financial Conduct Authority]] (FCA).<ref name=Regulators>{{cite news |url=https://www.reuters.com/article/us-finance-summit-reforms-idUSTRE71O41P20110225?pageNumber=1 |title=Regulators Crack Down on Banks, Markets |date=25 February 2011 |work=Reuters |access-date=8 March 2011 |first=Kevin |last=Drawbaugh |archive-url=https://web.archive.org/web/20120726015418/http://www.reuters.com/article/2011/02/25/us-finance-summit-reforms-idUSTRE71O41P20110225?pageNumber=1 |archive-date=26 July 2012 |url-status=live |df=dmy-all }}</ref> Each country has its own specific restrictions on hedge fund activities, including controls on use of derivatives in Portugal, and limits on leverage in France.<ref name=Coggan/>

In the EU, managers are subject to the [[Alternative Investment Fund Managers Directive|EU's Directive on Alternative Investment Fund Managers]] (AIFMD). According to the EU, the aim of the directive is to provide greater monitoring and control of alternative investment funds.<ref>{{cite web |url=http://europa.eu/rapid/pressReleasesAction.do?reference=MEMO/10/572&format=HTML&aged=0&language=EN&guiLanguage=en |title=Directive on Alternative Investment Managers ('AIFMD'): Frequently Asked Questions |date=11 November 2010 |work=Europa |publisher=European Union |access-date=8 March 2008 |archive-url=https://web.archive.org/web/20111129084037/http://europa.eu/rapid/pressReleasesAction.do?reference=MEMO%2F10%2F572&format=HTML&aged=0&language=en&guiLanguage=en |archive-date=29 November 2011 |url-status=live |df=dmy-all }}</ref> AIFMD requires all EU hedge fund managers to register with national regulatory authorities<ref>{{cite news |ssrn=2383445 |title=Varieties of Regulation: How States Pursue and Set International Financial Standards |last1=Prabhakar |first1=Rahul |date=1 June 2013 |publisher=Oxford University GEG }}</ref> and to disclose more information, on a more frequent basis. It also directs hedge fund managers to hold larger amounts of capital. AIFMD also introduced a "passport" for hedge funds authorised in one EU country to operate throughout the EU.<ref name=Chay/><ref name=Regulators/> The scope of AIFMD is broad and encompasses managers located within the EU as well as non-EU managers that market their funds to European investors.<ref name=Chay/> An aspect of AIFMD which challenges established practices in the hedge funds sector is the potential restriction of remuneration through bonus deferrals and [[clawback]] provisions.<ref>{{cite news |url=http://www.ft.com/cms/s/0/a766a03e-e47d-11e1-affe-00144feab49a.html#axzz2466ka3Qi |title=EU hedge funds face pay threat - FT.com |first1=Alex |last1=Barker |first2=Sam |last2=Jones |work=ft.com |year=2012 |access-date=20 August 2012 |archive-url=https://web.archive.org/web/20120815182450/http://www.ft.com/cms/s/0/a766a03e-e47d-11e1-affe-00144feab49a.html#axzz2466ka3Qi |archive-date=15 August 2012 |url-status=live |df=dmy-all }}</ref>