The European Commission has come out against a key change to the proposed Alternative Investment Fund Managers Directive, in opposition to the wishes of the European Parliament and the European Union President, as observers including the UK's Financial Services Authority warn that the impact of the directive may be catastrophic.

Christopher Becher, a policy officer at the EC, speaking at a conference organised by French business school Edhec, said the EC was standing by the rules it had proposed on marketing, referred to as the rules on passports.