AIMA

The Alternative Investment Management Association

Alternative Investment Management Association

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Asia Pacific Asset Management regulation

Asia Pacific Asset Management regulation

The regulatory regime in Australia is governed by the Corporations Act 2001(Cth) (Act). All financial products and services are subject to regulation underthe Act. Providers of financial services and issuers of financial products are required to hold an Australian financial services licence, issued by the Australian regulator -the Australian Securities and Investments Commission (ASIC).

Australia’s regulatory regime does not currently distinguish between hedge funds and other managed funds. Therefore, hedge funds do not receive specific regulatory treatment under the Act - instead, the rules applicable to traditional equity funds apply equally to hedge funds. If hedge funds are offered to retail investors in Australia then, as with all other funds, they will typically need to be registered "managed investment schemes", irrespective of whether or not they are funds of funds. Hedge funds fall under the scope of the Act just like all other funds and the provisions that apply depend on whether they are structured as managed investment schemes (such as trusts) or companies. ASIC has released proposals which specifically relate to hedge funds, aimed at improving disclosure provided to retail investors who invest in hedge funds, however these proposals have yet to be finalised.

Key legislative documents

Corporations Act 2001

Hong Kong

The Hong Kong legal and regulatory regime governing the offer, distribution and marketing of interests in a collective investment scheme (CIS) (including a hedge fund) in Hong Kong is primarily contained in (i) the Companies Ordinance (the CO) where the CIS is structured as a company; and (ii) the Securities and Futures Ordinance (SFO) which regulates to a large extent the marketing activities associated with the offering of 'securities' generally, including a CIS structured as a company, limited partnership or a unit trust. Accordingly, the offering, distribution and marketing of a hedge fund in a corporate form will be governed by both the CO and the SFO. The SFO (with subsidiary legislation and rules) also sets out the licensing and operational requirements on managers/advisers.

Key legislative documents

Securities and Futures Commission Companies Ordinance
Securities and Futures Ordinance (in force since 1 April 2003) with subsidiary legislation and rules

India

In 2011, the Securities and Exchange Board of India (SEBI) published a concept paper on its proposed SEBI (Alternative Investment Funds) Regulations. Under the proposed AIF regulations, it would be mandatory for all types of private pools of capital or investment funds to seek registration with SEBI.

Relevant consultations

SEBI Concept Paper on proposed alternative investment fund regulation (2011)

AIMA documents

Response to Concept Paper on proposed alternative investment fund regulation (August 2011)

Singapore

The Monetary Authority of Singapore (MAS) has proposed legislative amendments to give effect to the revised regulatory regime for fund management companies, as well as additional proposals to further enhance the business conduct requirements for fund management companies. MAS proposes to require fund management companies to introduce a risk management framework for their fund management operations in order to identify, address and monitor the risks associated with the assets that they manage. MAS also propose to require fund management companies which operate under the notification regime to undergo independent annual audits.