INTERNATIONAL: Draft rules on Asia region fund passport released

Tuesday March 3 2015

Draft rules on the Asia Region Funds Passport have been published for public consultation.

The Passport will create a regional market for managed investment funds by facilitating cross-border issuing. The Passport will also reduce red tape for fund managers by creating a standardised set of rules that will apply across Passport participants.

The release of the rules for public consultation follows the signing of a statement of intent on the Passport by finance ministers from Australia, Korea, New Zealand and Singapore at the APEC Finance Ministers’ Meeting in Bali in September 2013.

Consultation will now take place jointly with government agencies from Australia, Korea, New Zealand, Singapore, Thailand, and the Philippines.

The passport will be governed by a Memorandum of Understanding, which will cover the following:

• the impetus to participate in the Passport, establish a governing framework, and set out the eligibility criteria for economies wanting to participate in the arrangement
• the areas in which a Participant will impose obligations on Passport Funds from other economies that are offered in its economy (the Host Economy Laws and Regulations).
• the regulatory arrangements for Passport Funds – how Passport Funds are to be registered and supervised by regulators and how the Passport arrangements are to be enforced (the common regulatory arrangements).
• the passport rules – a common set of requirements with which the Operators of Passport Funds and certain other persons involved with Passport Funds will be required to comply on an ongoing basis. The Passport rules contain provisions that govern the behaviour of a Passport Fund in both the home and host economies. The Passport rules are designed to be directly incorporated into the law of a participating economy.
• arrangements for cooperation between regulators.

Submissions close on 10 April 2015. The MOU is intended to be finalised in August 2015, with Passport member economies endeavouring to implement changes to legislation and regulation where necessary to give effect to the Passport arrangements within 12 months of becoming a party to the MOU.

Click on the above link for the consultation.