The UK's Financial Services Authority (FSA) has established a centre of expertise on private equity, extending an approach that may set the pattern for the industry's regulation across Europe.

The centre acts as a communications channel between the industry and the FSA, which is already a European leader when it comes to regulating private equity. A spokesman for SJ Berwin, the law firm, said: "Within Europe, most countries do not directly regulate private equity and venture capital fund managers. The UK is one exception. Many believe the requirement for private equity fund managers to be regulated might spread to other European countries.