Fight in the playpen

Last month, Spain's two largest unions organized a general strike to coincide with the summit of European Union leaders in Seville. But the centre right prime minister has faced some more surprising opposition of late. An ad hoc union of foreign asset managers is up in arms over a proposed tax reform that they say discriminates against them. The problem is what one Spanish fund manager calls a corralito - a playpen - a little fence erected to protect domestic Spanish firms from unwanted foreign competition. It takes the form of a tax benefit for investment funds that excludes the Sicav structure used by most foreign asset managers. The barrier may be small, but the foreign managers are taking it pretty seriously. And well they might. According to some analyses the proposed changes to the personal taxation system could effectively shut most foreign managers out of the Spanish retail market.