There are no major obstacles to granting access to the European Union’s (EU) passport system for alternative fund managers in Canada, and several other countries, the European Securities and Markets Authority (ESMA) said Tuesday.

ESMA has published its advice on whether the EU’s regulatory passport for alternative investment fund managers should apply to non-EU fund managers in several other countries.

Currently, non-EU hedge funds and other alternative managers must comply with each country’s national regime in the EU. Passport access is currently only available to firms and funds that are based in the EU. If the EU decides to extend the passport to non-EU firms, they could market and manage funds throughout the EU.

ESMA examined whether passport access should be extended to 12 countries, including Canada, based on whether there were significant obstacles regarding investor protection, competition, market disruption and the monitoring of systemic risk which would impede applying the passport.

It found that there are no significant obstacles impeding the application of the passport to Canada, Japan, Switzerland, Guernsey, and Jersey, but noted a handful of issues with various other countries, including the U.S.

The advice from ESMA will now be considered by the European Commission, parliament and council.