ASIC eases licensing for foreign fund managers
TheAustralian Securities and Investments Commission(ASIC) has updated its criteria for foreign collective investment schemes (FCIS) offering products into Australia and has indicated they will not need to comply with some local regulations if coming from a market with similar regulatory regimes.
Under the new criteria ASIC says if a FCIS plans to operate a managed investment scheme or offers it securities in Australia it will provide conditional licensing, registration and product disclosure relief if the foreign scheme is based in regulatory regime equivalent to Australia.
The relief will also be tied to the level of co-operation between Australian regulators and those of the FCIS and the level of protection offered to Australian investors.
As a result of this change ASIC has recognised that products offered from legitimate investment scheme operators in New Zealand and the United States have satisfied the necessary requirements and has issued a class order giving registration and licensing relief to certain schemes from these two countries.
The changes have been released as Policy Statement 178: Foreign Collective Investment Schemes and replaces Policy Statement 65 which dates from 1993 when ASIC first moved to clarify the status of FCISs.
ASIC has stated that schemes from jurisdictions previously recognised but without an offering in Australia will be considered as they when new applications are made to offer a FCIS into Australia.
The policy will also allow responsible entities of Australian-registered schemes to invest in unregistered FCISs overseas but only if ASIC has co-operation arrangements with the regulator of the FCIS and the scheme is regulated in line with international standards.
ASIC says the change to the new policy is the result of the adoption in late 2002 of its’ Principles for Cross Border Regulation which recognises overseas regulatory regimes for foreign product issuers and service providers wishing to operate in Australia.
The new policy will also be offer open-ended relief for Australian registered schemes investing in certain FCIS’s and clarifies the grounds on which Australian registered schemes can invest in FCIS’s from jurisdictions not currently recognised by ASIC.
AUTHOR
Jason Spits
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