• EU venture capital and social entrepreneurship funds to focus on start-ups, innovative firms and enterprises with positive social impacts
  • Uniform registration, conduct and transparency rules for managers
  • Cross-border marketing of funds made easier and cheaper

The European venture capital funds (EuVECA) and European social entrepreneurship funds (EuSEF) should attract more investors under new rules voted on Thursday.

These funds, part of the Capital Markets Union Action Plan, aim to mobilise more investment capital for innovative small and medium-sized enterprises (SMEs) and social undertakings in the EU.

The new rules aim to broaden the range of firms able to find investors on European capital markets and encourage investment in firms that markets may view as a risky, or which aim to deliver social benefits.

MEPs amended the proposed rules to:

  • widen the range of managers eligible to set up and manage EuVECA and EuSEF funds to include those with assets under management of more than €500 million,

 

  • widen the range of firms that EuVECA can invest in to include  unlisted companies with up to 499 employees,

 

  • broaden the  definition of enterprises that EuSEF can invest in to include “services and goods generating social return”,

 

  • enable EuSEF and EuVECA  registered managers to market their funds across the EU, and

 

  • give the European Securities and Markets Authority (ESMA)  an oversight role to ensure that the funds are consistently registered and supervised.

 

Rapporteur Sirpa Pietikäinen (EPP, FI),  said: “Bank lending will not be sufficient to boost European innovative economies to grow and we are desperate need of a substantial increase in venture capital funding across Europe. The EuVECA regulation will allow more innovative, clean and future-oriented ideas, projects and companies to be financed across Europe”.

 

Next steps

The text was approved by 523 votes to 46, with 67 abstentions. The revised rules will enter into force on the twentieth day following that of their publication in the Official Journal of the European Union.