NEWSLETTER HIGHLIGHTS

2017
DEC ... EUR MANAGERS COME TO THE US
  • At the end of 2017, we formally opened our US company, BOUGEVILLE CONSULTING, LLC for the purpose of doing business in the United States.

  • We started working for clients from Europe to enable them do more business in the United States. This involves coordinating with local lawyers and finding the best solution to reconcile business costs and benefits, regulatory compliance and investors' preferences.
OCT US MANAGERS ACCESSING EUROPEAN MARKETS...
  • In October, we started working on a project with a start-up manager based in the US. We have been assisting him build multi-jurisdictional operations, which includes a UK office at a time when the political and regulatory landscape in Europe has been evolving fast.

  • This has involved finding the most efficient solution for the UK office given its activities, and coordinate with service providers globally.
JUN PRINCIPLES FOR RESPONSIBLE INVESTMENT
  • Since we have been in the US, we have got involved in the UN PRI's effort to have hedge fund managers become signatories to the Principles.

  • We attended an event on the topic in New York in June and supported the effort in the press. View conference information View press article
APR EUROPE, BREXIT, COLLABORATION WITH CAIA
  • As we prepared for the launch of our US operations, we started to develop an informal collaboration with the Chartered Alternative Investment Analyst (CAIA) association, of which several clients are members.

  • In the second half of 2017, two of our articles were published in the Alternative Insvestment Analyst Review (AIAR), one of CAIA's periodical publications. View article on Brexit
    View article on UK regulation
FEB HF NED
  • In February, we became NED to an emerging fund manager for the purpose of providing an oversight of his business during his first year of operation in the context of the AIFMD in Europe.

  • View UK FCA register
2016
OCT US MANAGERS
  • We spent the second half of 2016 speaking with US managers who were concerned about the ways in which they can keep entertaining the possibility of having European investors in spite of the AIFMD. Passporting rules, registration requirements and other such evolving features in Europe are often in need of clarification. We offer consultations as well as solution implementation on this topic.

  • In October, Hedgeweek interviewed us on the topic. View article
AUG VARIATIONS OF PERMISSIONS
  • In August, we assisted a client change their permissions from investment manager to AIFM in the UK. While many managers start with being authorized as investment managers, their growth in scale, building of a strong track record and increase in investor appetite may warrant an upgrade in permission, with a commensurate enhancement of the systems and controls which it has in place to ensure AIFMD compliance. We can assist clients with both process and substance, with either direct input or project coordination.

JUN MANAGER MIGRATIONS
  • June was the month of Brexit in the UK. In the summer, we worked for a manager for the purpose of moving their operations across European jusrisdictions. This involved the coordination of the incorporation and regulatory processes. We had to be proactive and speak with several regulators in Europe directly for the purpose of ensuring smooth transition.

  • In the US, we started collaborating with CAIA. We wrote an article on Brexit, published in CAIA's Alternative Investment Analyst Review (AIAR). View article
APR FREIGHT DERIVATIVES
  • We have, over time, worked on the marketing of funds with unusual strategies, including, in February, Forward Freight Agreements. We have, over time, provided support in the setting up of these operations, which includes devising ways of making the products in questions more easily understandable to various stakeholders, including regulators.

  • You can read an article we have written on setting up hedge funds here. We are stragety agnostic and aim to ensure clients who think differently can market their products and ideas in the best possible of ways.
FEB DOING GOOD
  • In 2016, we worked with a variety of managers who have adopted structures, or approaches, specifically designed to take into consideration the public good. This includes assisting a manager specialising in creating scale for small charitable funds and foundations, working on PRI compliance, and exploring solutions with religious endowments.

  • We reported on this in various media. You can access our contributions here, here and here

  • For articles more specifically on PRIs and hedge funds in 2016 and 2017, please see this article, and this contribution
2015
DEC FAITH & INVESTMENT
  • We have organised a conference to take place in December around the theme of Faith and Investment. As more and more investors (family offices, wealth managers, pension funds, endowments) ask themselves the question of values in the context of their investment analysis, decisions and actions, we invited representatives of three religions to present their approaches to investment in the context of their faiths. If you are interested in attending this conference, to take place at the House of Lords, please email us

  • A follow up article on the same topic may be found here. It looks at how several religious endowments approach investment decisions and gives the example of a recent initiative.
OCT US HEDGE FUNDS: BUILDING ON HISTORICAL STRENGTHS
  • For the third year running, Hedgeweek asked us to write a report to compare the US and European hedge fund industries. We found that US hedge funds were building on historical strengths, in spite of a challenging investment as well as operational environment. View article

  • This exercise follows on from work we have been doing to assist US managers with European registrations for private placement under the AIFMD. Previous contributions on the same topics can be viewed here and here
AUG FAMILY OFFICES
  • In August, we finalised a project aiming to build infrastructure, controls and processes around the hedge fund investments of a newly-created family office. In addition to protecting the family with respect to the operational standards of its ongoing investment, this will make it easier for the family to attract co-investors in due course, in the context of a pooled investment vehicle. We also provided a blue print for a marketing framework for the future.
JUN ASIAN MANAGERS
  • Throughout 2015, we started working with several Asian fund managers, who had become interested in our expertise in European marketing - in terms of local knowledge, understanding of the new regulatory landscape and distribution capability.

  • We appeared in the press on the topic of current appetite for Asian exposure, including in a Reuters article
APR FUNDS OF FUNDS
  • In April we finalised a project aiming to assist a family in the establishment of a business to facilitate its investments in hedge funds. The idea was to put in place the right infrastructure and controls to allow other families and investors to join them in due course, thus effectively becoming a fund of funds / multifamily office.

  • We gave several interviews on the topic, including for a Reuters article
FEB LITIGATION FUNDING
  • More recently, we have assisted a variety of hedge fund managers whose investment strategies do not follow "conventional" fund models. We took this opportunity to organise a series of educational events, including one on litigation funding for the CFA UK, to take place on June 15. The questions discussed will include the demand for such uncorrelated asset classes, and legal and regulatory issues specific to these structures. Book space

  • In August, we wrote an article for Alpha Q in which we describe how these investment vehicles specialising in litigation funding differ from other asset classes. We also discuss their possible impact on society. View article
2014
DEC SEASONAL APPEAL
  • We launched a Seasonal Appeal for companies in the financial services industry in London to donate stationery items (pens, notebooks, old laptops) to bring to two schools in Burkina Faso in the New Year. This appeal was kindly published in HedgeWeek and the facebook page of our company will provide updates throughout the life of the project. Two years before, we had done a pilot project in Ethiopia; anyone interested to donate can do so by contacting us and can also see images of the Ethiopia project
OCT MARKETING OF HEDGE FUNDS
  • Our third global market survey was performed soon after the AIFMD became mandatory and, in contrast with the previous year, it revealed creative business solutions to adapt to increased costs and barriers to entry, instead of business slow down as observed previously. Platform models have diversified and expanded, while private investors are getting more confident about models that can pass the test of institutional quality

  • In September, we became FCA authorised to market hedge funds under the new framework. A report on our global survey was published in COO Connect while we expressed our view on the link between strong operations and successful marketing in Financial News
AUG AIFMD
  • In July, the transition period to become compliant with the AIFMD came to an end. We have continued to assist emerging managers with the development of business plans which would ensure seamless compliance with the new framework once they would become caught under its scope. See EU page on the topic

  • In the UK, the Financial Conduct authority has devised a framework to enable managers to register locally for the purpose of being able to sell alternatives investment funds to qualified investors. View FCA page on the topic
JUN GLOBAL REGULATORY SYSTEMS: LISIG EVENTS
  • LISIG, the Legal Issues Special Interest Group of CFA UK in which we are involved, has organised an event which will appeal to regulatory specialists and investment professionals alike. One year after the UK's Financial Conduct Authority was formed, senior individual responsibility has emerged as an important topic, in all areas of the financial services industry. Join us to discuss this topic, which newly-regulated entities may find particularly relevant. Book space

  • Later in the year, we organised a sister event, on the US regulatory system this time. Many of us based in Europe have in interest in having a broad understanding of US regulations, be it in the context of understanding our clients better, knowing to what extent given activities will be in or out of scope, or familiarising ourselves with more recent developments. Book space
APR EUROPEAN HEDGE FUNDS: THE AGE OF WISDOM?
  • In order to support various ongoing mandates relating to providing guidance in Europe, we maintain a close watch on how national markets are evolving, be it in response to regulatory uncertainty or as a result of commercial developments. As an introduction to its Annual European Awards, Hedgeweek commissioned us to share our findings, and the resulting report was published in April. View report

  • A year later, Hedgeweek commissioned us again to update our findings and discuss how the European hedge fund industry had evolved. This new report was again published on the occasion of Hedgeweek's Global Awards, in which we were voted Best European Business Consultant. View report
FEB MARKETING HEDGE FUNDS UNDER THE AIFMD
  • In February, we teamed up with Global Prime Partners (GPP) to produce a Marketing Manual under the AIFMD: we will be in contact with a whole range of regulators across the EU with a view to understanding their policies on, and approaches to, the subject for the years to come. When we spoke with fund managers and their investors in the context of our global market survey last year we found further evidence that regulatory uncertainty was slowing down business as far as European investors were concerned. If you would like to discuss this topic, or express an interest in having access to the book, email us

  • We carried this research for the double purpose of assisting clients with the new rules and preparing ourselves for the additional service we were about to offer, namely the marketing of our consulting clients' products. In September, Bougeville Consulting received the FCA's authorisation to be able to introduce clients to potential investors.
2013
DEC SEASONAL APPEAL
  • Exceptionally, our seasonal appeal did not take place in 2013. However, we published photographs of our pilot project that took place in Ethiopia the previous year, and we started raising sponsors to ensure the next project would happen at a larger scale. For information about the follow up project, please see DEC 14 update.

OCT GAIM OPS INTERNATIONAL (PARIS, 12-14 NOV)
  • GAIM Ops International brings together COOs, CCOs, and Heads of Operational Due Diligence from top-tier hedge funds, leading fund of funds, and major institutional investors to discuss best practices, debate trends, and network over 3 productive, educational days. Bougeville Consulting will be speaking at the pre-conference Summit session focused on “Emerging & Smaller Funds around the Globe”, and, those who read this message are entitled to a 20% discount off standard registration rates. To take advantage of this offer, simply quote code XU2488MS when registering. Register

  • Our presentation consisted in an analysis of the results of our annual survey, this year focusing more specifically on investment in emerging managers. It was published in hedgeweek and can be viewed here. COO Connect also reported on it here
AUG INVESTING IN BANKS UNDER UNCERTAINTY
  • The developing regulatory regime makes it difficult to value banks. How much capital will they be required to hold? What form should that capital take? What is the PRA looking for from UK banks? Investors that can interpret the potential regulatory regime well have the opportunity to identify value. CFA UK is pleased to provide members with access to two experts on this subject: Bob Penn, partner at Allen & Overy, and James Clunie, CFA, manager of Jupiter’s Absolute Return Fund. This event was organised by the Legal Issues Special Interest Group and will be moderated by William Wright, who was editor of Financial News between 2004 and 2011. Book space

  • Continuing on one of LISIG's themes, we organised an event on Shadow Banking, to take place in London on April 1, 2014. IOSCO's Secretary General David Wright will present on the topic as part of the CFA UK Eminent Speakers' Series. He will discuss the role of "Shadow Banking" investment funds in providing market based financing to the economy, their use by investors and the success of some regulatory reforms undertaken since the 2008 crisis. He will also discuss how regulators could more effectively address the issues raised. Book space Watch Bloomberg's short video on the topic

  • Financial News published an article on what was said during the event. View article
JUN ARE US HEDGE FUNDS MORE ATTRACTIVE? A TALE OF TWO MARKETS
  • In the run up to the publication of their "special US" edition, hedgeweek commissioned us to research the US hedge fund market, analyse the reasons behind what looks like an over-performance relative to other geographical regions, and attempt to identify trends for the years to come. View article

  • A year later, we tested our initial findings in the light of the rise of equity markets: this confirmed US managers' area of excellence. We also highlighted areas of convergence (e.g. in terms of the demand for liquid alternatives) as well as specific topics where two models and markets still co-exist. View article
APR LIBOR: THE WAY FORWARD
  • In 2012, HM Treasury commissioned an independent review and has now adopted proposals for the rehabilitation of LIBOR in full. A perceived concern is whether a reformed LIBOR may be inconsistent with standard market terms defining the "old LIBOR" in outstanding contracts; this is known as "the legacy issue". The CFA UK's Legal Issue Special Interest Group is pleased to announce that Joanna Perkins, Director of the FMLC, will come and speak to us about LIBOR. Joanna is an expert on the subject and this promises to provide fascinating insights into what has happened and provide an overview on the implementation of recent reforms, including the introduction of a LIBOR Oversight Committee to regulate the LIBOR benchmark. Book space

  • Throughout 2012 and 2013, the CFA Institute updated a page with recommended readings on the topic, echoing the event we organised for CFA UK. View report

  • Further information from Bloomberg as of July 2017 may be found here
FEB WOMEN ON BOARDS: THE EU 40% OBJECTIVE
  • The European Union recently backed a proposal to introduce a quota of at least 40% female non-executive directors on the boards of larger listed companies by 2020. While it has been presented as an objective rather than mandatory, the intention is for equally qualified women to be given preference to help achieve this goal. As a prominent female investor with a legal background, Nicola Horlick, CEO of Bramdean Asset Management LLP, will be sharing her thoughts on questions this quota may raise – in particular its enforceability, practicality and legitimacy. This event has been organised by CFA UK's Legal Issues Special Interest Group (LISIG). Book space

  • CFA UK's quarterly publication Professional Investor reported on the event in its Winter 2013/14 issue. View article
2012
DEC SEASONAL APPEAL: PENS FOR AFRICA
  • In December, we were able to bring stationery items to the Ministry of Education in Addis Ababa. They were distributed to schools in remote (and poorer) parts of the country, along with food and clothes which you also kindly sponsored and gave, respectively. Thank you for your donations.

  • This followed an appeal we launched In October, for our clients, partners and friends to recycle as much office supply as possible, especially pens, with a view to supporting Education in Ethiopia. More on this here and here.
OCT CFA UK LISIG
AUG ANNUAL INVESTOR SURVEY
  • Investors: what are their investment targets? We spent part of August asking those in charge of analysing hedge funds for investment purposes what they expected the next quarters to look like. An interesting range of investor types, from Family Offices to Pension Funds, spent time telling us what strategies they would be after in the next year, why size makes a difference, and what hurdles they have in place to make sure they select the best managers only.

  • At the beginning of 2013, Bougeville Consulting's study was published in hedgeweek. View article
JUN SHORT SELLING REGULATION
  • We informed clients of the current state of measures regulators throughout the EU had put in place to ensure they kept an eye on short selling. While not all regulators had something in place then, this was going to change when the Short Selling Regulation (SSR) would be implemented in November. Ahead of this deadline, we provided clients with an explanation of the broad framework and a summary of the forthcoming rules.

  • In the run up to November, we assisted clients in various ways: in registering them with local regulators in several EU countries; in remotely providing them with the relevant information enabling them to upload reportable transactions. For those less likely to have reportable transactions in the short term, we drafted a DIY manual to allow them to register locally in their own time. Order manual
APR REGULATORY CHANGES IN SWITZERLAND
  • In April, we informed our clients of an initiative by the Swiss legislator to amend the country's Collective Investment Schemes Act. While this policy revision was in its initial stages, we provided an analysis of the implications of the changes under consideration. These included the broadening of the scope of the law to include a new category called "distributors"; a potential restriction of the definition of a "qualified investor"; and, the obligation for a manager whose fund is not in Switzerland to appoint someone locally.

  • At the beginning of 2013, the Swiss Federal Department of Finance announced that Parliament had approved the revised Law and indicated the changes would come into force in March. More details
FEB THE ALTERNATIVE INVESTMENT FUND MANAGERS DIRECTIVE
  • Following the publication by the UK FSA of its initial thoughts on possible approaches to implement the AIFMD in the UK, we released a study to assess how the various areas of a fund manager's operations would be impacted. We looked at: a manager's ability to market alternative funds across borders within the EU; capital requirements; limitations on leverage; liquidity & stress tests; valuation; mandatory disclosures to investors and to the FSA; conflicts of interest.

  • We also contributed to the Financial Markets Law Committee's response to the UK FSA consultation on AIFMD proposed rules. The FMLC undertakes work to identify areas of legal uncertainty in international wholesale financial markets and is actively supported by the Bank of England, HM Treasury and the FSA. View paper (dated March 18, 2013)
2010
  THIRD COUNTRIES IN THE AIFMD

For more information about any of the above, please contact:
info@bougeville.com

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