The proposals also include the creation of a so-called "passport" - something that would allow hedge fundsauthorised in one EU territory to operate in any of the other countries in the 27-strong bloc.
Unregulated by the US Securities and Exchange Commission (SEC), the UK Financial Conduct Authority (FCA) or other relevant regulators, hedge funds are not subject to the limitations and restrictions imposed on their public fund brethren, such as retail mutual funds in the United States or authorised unit trusts in the United Kingdom.