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Dear [MEP personalised],
Europe’s SMEs deserve fair treatment and stable investment 
I write on behalf of my peers and co-signatories, who are the owners and managers of smalland medium sized enterprises from across the EU. SMEs form the bedrock of economicactivity across Europe and their ability to generate jobs and contribute to wider growth andprosperity is critical in meeting the goals of the EU’s 2020 Strategy. It is from this fertilebreeding ground of innovation that the European and international leaders of tomorrow willemerge.Growth businesses require access to long term sources of finance. In the present climate,such finance is scarce, but one important source is private equity and venture capital. Theselong-term investors provide the capital and expertise necessary to nurture businesses and topropel them on to the next stage in their development.We represent a slice of the 25,000-plus population of European businesses that currentlybenefit from private equity and venture capital support. We are therefore increasingly alarmedby proposals within the EU’s draft Alternative Investment Fund Management Directive thatwould prejudice private equity and venture capital-backed companies such as ours, andultimately restrict access to finance for Europe’s growth companies.We can see no justification to prejudice our companies or to include them in a Directivetargeting fund managers. Efforts to do so would distort the market, harm finance for innovation and company growth and ultimately inhibit Europe’s economic recovery.Of particular concern are proposed disclosure obligations for private equity and venture-backed businesses. We do not oppose increased transparency across Europe whatever thetype of company or sector it operates within. At the same time, we believe there should be alevel playing field for all. We do not see why the law should discriminate against differenttypes of privately owned companies. We do not see why there should be one set of rules for private equity and venture-backed businesses and a different set of rules for their competitors just because of other types of ownership – whether owned by families, oligarchs or largeconglomerates. If protections are necessary, they should be afforded to stakeholders of allprivate businesses, and dealt with through horizontal company law.Compounding this are proposals to disclose matters which are for the board of a company todetermine, such as information related to the development or research policy of a company.Measures which call for unequal levels of disclosure would be
 
particularly damaging to venture-backed companies that have invested heavily in productdevelopment and whose ideas may be exploited by much larger rivals, stifling competition.Finally, we are very concerned that the initial Commission proposal to exclude smaller businesses from these provisions (below 250 employees) has been watered down in someproposals to companies with less than 50 employees (Articles 26 to 30). This shows nounderstanding of the resource requirements of very early-stage companies at a vulnerablestage in their corporate development. Rather than protecting them, such new administrativeburden would weaken SMEs.The cost of complying with the proposed disclosure would be around €30,000 per year – avery significant outlay for SMEs. The compliance costs and excessive capital requirements of this Directive will also have a major impact on venture capital firms themselves, and willradically reduce their ability to back SMEs in the future, while increasing the barriers to entryfor new venture capital funders to emerge. This is an outcome at direct odds with numerousCommission financed initiatives to promote venture capital.Much of the chatter around this Directive has focused on the impact on hedge funds, but it isa big mistake to think that the AIFMD’s impact will be restricted to companies trading inarcane financial instruments. This is about the real economy, and these proposals will directlyaffect tens of thousands of companies across every sector, from fashion to photovoltaics, andfrom sandwich making to waste recycling.Innovative businesses will be central to Europe’s recovery and sustainable economic growth.We urge policymakers to ensure all companies are treated fairly, to recognise the fragility of high potential businesses during certain phases of their development, and to ensure that theAIFMD proposals take into account the vital role played by private equity and venture capitalin this process.Yours sincerely,Tom B. van Aken, Avantium Technologies B.V., The NetherlandsCo-signatories:1.Altin Saliasi, Landeslease Sh.A, Albania
 
2.Franz Beranek, UC4 Software GmbH, Austria3.Jon Hoem, Miracor Medical Systems GmbH, Austria4.Christopher Maier, Ernst Glogar GmbH, Austria5.Wolfgang WS. Senne, Oridis Biomed, Austria6.Gabe Gotthard, SmApper Technologies GmbH, Austria7.Walter Altmann, Winterheller Software GmbH, Austria8.Wolf Haidinger, Hyperwave AG, Austria9.Rudolf Schütz, Powerlines Group, Austria10.Patrick Lecluyse, Betafence, Belgium11.B. Tas, Sovitec, Belgium12.Rudy Polfliet, Winsol International NV, Belgium13.Steve Husk, FRSGlobal, Belgium14.Board of directors, Biofer NV, Belgium15.Eddy van Arwegen, Verelst Aannemingen NV, Belgium16.David Stanks, 3si Security Systems, Belgium and USA17.Denis Payre, Kiala N.V. and Kiala SAS, Belgium and France18.Stuart Till, Investor.bg, Bulgaria19.Ianko Krandarov, Ice Line AD, Bulgaria20.Bistra Kirova, BM Leasing, Bulgaria21.José García Hermoso, Fama Serdika EAD, Bulgaria22.Dragica Pilipovic Chaffey, Interactivni Tecnologii AD, Bulgaria23.Gilles Bonaert, Calucem, Croatia24.Jiri Sejnoha, Roltecnik a.s., Czech Republic25.Pavel Bernát, Termizo a.s., Czech Republic26.Mojmir Balous, CPRESS, a.s., Czech Republic27.Preben Tolstrup, Logstor, Denmark28.Jesper Kristensen, Unifeeder, Denmark29.Christian Tang-Jespersen, Hymite A/S, Denmark30.Søren Nielsen, Action Pharma A/S, Denmark

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