Asset managers are fighting a proposal from U.S. antitrust authorities to tighten scrutiny over how these firms influence the way businesses operate and, in turn, the prices of everything from airline tickets to food.
In March, the asset-management industry pushed back on the proposed rule on a videocall with congressional staffers. Executives of Capital Group Cos., Fidelity Investments, Nuveen LLC and Wellington Management Co. joined alongside others, people familiar with the matter said. Securities Industry and Financial Markets Association, a lobbying group, organized the call.
The industry’s pitch was that filing burdens from the rules would cost investors. Some of those on the call said it would also create unnecessary delays that would make it harder for index funds to track benchmarks or for stock pickers to take opportunistic bets.
The proposed rule is coming from the Federal Trade Commission. It would require investment firms to file for antitrust review any time a manager’s collective funds go above certain thresholds, in some cases this means holdings of more than 10% of a company. Right now, investment firms generally only have to alert regulators when a single fund takes a large-enough position in a company.
Government officials want to remove blind spots in how they monitor influential investors’ impact on everyday consumers as asset managers, hedge funds and private-equity firms become ever-bigger forces in markets. Among regulators’ concerns—and why it falls under antitrust rules—is the potential for these firms to exert anticompetitive pressure.
