Tuf reform changes assets under management

The reform of the Testo Unico della Finanza (Tuf) intervenes profoundly in the discipline of collective asset management, 'representing a true laboratory of innovation aimed at redefining the relationship between savings, investment and enterprise at its roots. It is not a simple technical update, but an attempt to redefine the role of the capital market, orienting the relationship between savings, investment and business in a more decisive way,' explained Filippo Sartori, of the University of Trento at the conference Riforma del Tuf e nuove frontiere del diritto dell'Economia, organised by the Parthenope University of Naples and coordinated by Diego Rossano.

The primary objective of this intervention, according to Sartori, is to overcome the traditional bank-centric model in order to broaden financing channels, with a particular focus on SMEs, thus making the Italia system more efficient and attractive, albeit intrinsically more complex. "This increased complexity, resulting from the coexistence of a plurality of vehicles and regimes, makes it indispensable," Sartori continues, "to place financial education as the very purpose of supervision and as a fundamental pillar for bridging the information gap. In fact, we are witnessing a crucial transition for the saver, who is abandoning the mere bank deposit to be encouraged, through a process of 'cognitive empowerment', to become an aware and autonomous investor'.

During the conference, even a suggestive key of interpretation linked to Article 118 of the Constitution emerged (Giuliano Lemme of the University of Modena and Reggio Emilia): the channelling of savings towards forms of investment that finance businesses becomes a sort of horizontal subsidiarity, in which the protection of the investor is functional to the collaboration of the individual for the efficiency of the entire market.

However, the architecture of this ambitious reform has to deal with an extremely complex supranational context. As Filippo Annunziata, of Bocconi University, explicitly points out, the European framework is characterised by a 'hypertrophy' of legislation in the financial field that makes the regulatory yard in perpetual construction and the balance between domestic and EU regulations necessarily unstable. Moreover, the Community discipline is fragmented between two historically and conceptually different directives, the Ucits and the Aifmd, which generate asymmetries on national markets. In order to make the Italia market more competitive and to attract capital, "The reform has made some very courageous choices and simplification drives," Annunziata continues, "starting with the deregulation of 'sub-threshold' managers. These operators move from an authorisation regime to a mere registration, operating in a substantial absence of public supervision and shifting protection to a purely contractual level, relying on the self-responsibility of professional investors'. Another crucial innovation, recalled by Annunziata, is the introduction of the Società di Libero Partenariato (SLP), a legal form borrowed from the French experience, specifically conceived to offer international private equity and venture capital operators a vehicle fully comparable to the Anglo-Saxon partnership. Added to this is the definitive consecration of hetero-managed Sicaf, conceived as pure investment containers on which supervision is focused solely through the external manager, and a clear strengthening of the separation of funds' assets, aimed at shielding the SGR and protecting its assets from obligations, including those arising from unlawful acts. In the background of these regulatory efforts, however, there remains the great unresolved knot of taxation, a decisive variable for the actual success of these forms of investment, which, going beyond the delegation of authority on regulation, risks thwarting the attractiveness of the entire system if it is not adequately harmonised.

While on the one hand the strong favour towards funds brought about by the Tuf reform and deregulation aims to attract capital for the real economy, on the other hand the massive entry of private equity exposes the market to new challenges, as illustrated in the analysis by Mariateresa Maggiolino of Bocconi. Looking specifically at the US experience, Maggiolino warns that the operations of these large funds generate complex problems of concentration and collusion in both industrial and equity markets. The first critical phenomenon is so-called 'vampirization': it occurs when a fund buys a target company by loading it with the debt of the operation (LBO) not to develop it, but to follow a purely extractive logic, selling its assets and cash. This behaviour inevitably leads to the exit of companies from the market, a significant drop in the quality of services offered and a drastic increase in prices for consumers. The second major risk is represented by 'roll-up transactions', i.e. a series of sequential and temporally spaced acquisitions of numerous competing companies at the local level; these fragmented transactions often escape the traditional antitrust radar, but in fact create local champions with enormous and dangerous market power. The third problem concerns an insidious disguised managerial concentration: if three apparently separate funds, which have acquired companies in the same market, answer to the same SGR, strategic decisions on budgets, investments and prices will be the responsibility of a single power centre, configuring a real concentration operation that European law requires to be sanctioned by looking at the substance of the decisions. Finally, the alarming danger of collusion and distortions linked to 'Club Deals' emerges. The parallel presence of many funds with minority stakes in the same sector tends to align incentives towards cooperation rather than competition, a dynamic often facilitated by the use of the same financial advisors who favour the circulation of strategic information. At the same time, if consortia between funds (Club Deals) are not formed to share risks or industrial expertise, but are created with the blatant intent of manipulating the takeover price of a target company downwards, they turn into true anti-competitive cartels.