Money-market funds may be forced by European Union regulators to hold minimum levels of liquid assets, and in some cases to hoard cash reserves, as part of a bid to toughen oversight of the $4.7 trillion global industry.

Michel Barnier, the EU's financial services chief, may require money-market funds that maintain a fixed share price to build up a cash "buffer" equivalent to 3 percent of their assets, according to draft proposals obtained by Bloomberg News. Barnier has identified regulation of money-market funds as a priority in the bloc's efforts to rein in so-called shadow banks.

Regulators are working to impose tighter restrictions on the funds since the September 2008 collapse of the $62.5 billion Reserve Primary Fund. Its failure, caused by losses on debt issued by Lehman Brothers Holdings Inc., triggered a wider run on money funds that helped freeze global credit markets.