You may well be thinking that you have had more unsolicited emails about AIFMD than you have had hot dinners. The trouble is that a lot of firms have a lot to do to adjust to the new, vastly superior European standard. Luckily we know from repeated assurances from them that the European Commission is the only body capable of producing really effective regulation. And where it is not effective, that is because national regulators don’t enforce it properly. Which is why MiFID II is introducing standardised enforcement measures. Things can only get better.

The surprising thing is that much of the industry still craves a single European rulebook. This is, I am sure, after they have carefully considered the dichotomy between European standardisation and national control. Would you rather have regulations that are the same as everyone else’s or would you like better ones? Standardisation has its benefits, but so too do good regulation and international competitiveness. And we won’t get them all. This is a live debate because financial services regulation will lie at the heart of UK re-negotiation. The industry can probably, just about, undermine the government’s efforts on this if the wrong voices prevail. The City needs a better-informed debate.

Meanwhile regulatory reform will be the talk of the town. As PRA takes up its new home and holds many a house-warming, the actual impact of the relocated deck-chairs will be modest. Most firms will be regulated only by the FCA rump and will be playing spot the difference. Is this really a new regulator is it the same crew with a similar name, similar rules (mostly European), same base in Canary Wharf, but desperately trying to prove how different it is? Actually that is going to be rather reassuring. After all, it is hardly as if we have not got enough regulatory change on the blocks, neatly lined up next to a series of hobby-horse themes, all of which will mysteriously survive the transmog.

So where do this year’s big risks lie? Watch the FSA lips. It’s promotion of unregulated collective investment schemes. It’s proper protection of client money. It’s conflicts of interest. It’s outsourcing arrangements. It’s anti-bribery procedures. And up to a point it will also be AIFMD readiness. So where do you start? Supervision themes are where the danger lies. If you are caught with trousers down in an area that FSA has already publicly identified as red light zone, you can only hope that you got your money’s worth. Inadequate precautions in any of these marked areas do not look clever.

But it is a different story for AIFMD. The regulator is going to do its best to be kind! FSA/FCA will use every concession that it can to lighten the burden of this directive. Remember how much FSA did not like AIFMD when first published. Some aspects have been tempered, but others have been no more than frayed at the edges by the constant chewing by the governments and regulators of the saner European nations. The point is that the directive reopens many ingrained assumptions about how best to structure an alternative fund. This is a time to look carefully at the cost base, at the implications of using exotic jurisdictions, at the marketing structure, at the agents. Given the transitional time that FSA has promised, it is not impossible to combine mandatory adjustment with strategic change. And that is exactly what the smart money will do.