Hedge funds regulation

The European parliament has approved a new system of regulation for hedge funds, which have been blamed for exacerbating the financial crisis.



The new rules governing the sector, which is mostly based in London, will come into force in 2013.



The rules are intended to add transparency by putting hedge funds and related activity under the eye of a pan-European watchdog.



Between 2013 and 2015 a London-based fund would be able to sell across Europe.



During that period third-country funds, such as American or Cayman Islands-based products will not be able to sell across Europe.



However, EU officials say from 2015 the market will include funds from outside Europe.