In January, the Financial Services Authority (FSA) kicked off the new year with the the paper, Implementation of the Alternative Investment Fund Managers Directive. The regulator discussed its future compliance plans for fund managers, depositaries, valuers and administrators.

The FSA plans to implement, beginning in July 2013, “significant changes” to regulate alternative fund managers working in the UK and the EU. The ambitious directive will the change regulation for (potential) AIFMs currently operating, managing and/or marketing alternative investment funds (AIFs). It will alter how AIFMs conduct their businesses, interact with third-party service providers under delegation (outsourcing) and depositary arrangements, administration and external valuers, according to the Financial Times.

While the plans don’t go into effect for some time, it’s not too early to criticize it. Bill Warren, managing director at the U.K.’s Warren Compliance, recently said no so fast with the new rules. He believes alternative fund managers are a “difficult arena” for FSA to not only monitor but the firms in question will face compliance challenges from fuzzy requirements and broad rules.

Warren recently said to the Financial Times that he thinks the firms will be “difficult to police,” especially with the “recording” by them of investors’ consideration of “significant opportunities.”

He explained, “No mention is made of what is considered “significant,” although this could and should be specified in any final rules issued by the FSA [following] the final EU directive.”

Warren also expressed additional concerns. He believes the new rules will include a “very large and complicated range of investment vehicles.”

He said, “At a superficial level I have sympathy for the AIFM firms and their outsourced partners in trying to position themselves in a position where they can defend themselves from the regulator. Is this another case of a bureaucratic approach to rid consumers who will generally it is assumed be fairly sophisticated, of perceived risk in an area where risk is commonly used to gain financially fairly and without seeking to bend the rules?”

This is food for thought probably just the tip of the iceberg with negative reactions.

Meanwhile, ValueWalk is also keeping its eyes on the FSA and it hasn’t always been a good thing. On January 26, the regulator was combing the site for content that had been written about Greenlight Capital’s David Einhorn. Why this was happening, we weren’t sure but it feels like big brother is watching us; however, the Securities and Exchange Commission would fall more into that category than the FSA.