Alfi conference preview: Charles Muller on Brexit

Charles Muller of KPMG Luxembourg chairs the morning session of day one of the Alfi European Asset Management Conference, 6 March 2018 KPMG Luxembourg

Charles Muller of KPMG Luxembourg chairs the morning session of day one of the Alfi European Asset Management Conference, 6 March 2018 KPMG Luxembourg

The Association of the Luxembourg Fund Industry holds its European Asset Management Conference on 6-7 March.

In advance of the event, Delano spoke with Charles Muller, partner at KPMG Luxembourg. He chairs the morning of the first day of the event.

Aaron Grunwald: What do you want the audience to get most from day 1 of the conference?

Charles Muller: The morning session that I am chairing is devoted to providing the attendees with a general overview of all the “hot” topics that are currently on the table of European decision-makers. We will hear the political view, then ESMA’s (the regulator’s) view, and then obviously the reaction from industry representatives. This session should allow asset managers and service providers to “move in the right direction” in the middle- and long-term.

What is the regulatory issue that European fund firms are not paying enough attention to? What should they be doing about it?

While a lot of attention has been devoted to Brexit relocations from London, EU27-based asset managers are in my view not paying enough attention to what Brexit could mean for them, especially if no transitional agreement is reached. Marketing funds into the UK or delegating certain functions to UK-based entities could become more complicated or even impossible as of March 2019. I think it would be a good idea to at least consider contingency plans for a “worst-case scenario.”

What’s a cool “regtech” provider that we should watch out for?

Creative and promising regtech solutions are still in their development phase and it is, in my view, a bit too early to comment. However, what I can say is that there are some interesting initiatives like governance.com, winner of our Fintech Awards Luxembourg 2016. There is a real interest in these regtech companies shaping the sector. It is clear that there is an awareness on the market that fintech’s role is less to disrupt and more to help. I think everyone will be watching the next developments very keenly.

Should the EU and UK make a post-Brexit “passporting” agreement for financial services?

I am strictly against this idea of trying to “punish” the UK for leaving the EU or of trying to “steal” business from the UK on this occasion. We should continue to work together constructively and pragmatically. However, being outside the EU is not the same as being inside the EU, and the EU27 cannot grant privileges to the UK that the former EU28 always refused to other third countries such as Switzerland. So if we consider passporting rights for third countries, we cannot restrict that discussion to only the UK.

Charles Muller is on Twitter