SFC further streamlines measures for authorised EU-regulated retail funds to implement changes efficiently
The Securities and Futures Commission (SFC) today announced a series of streamlined post-authorisation measures for UCITS funds in a circular to facilitate their implementation of changes that are in compliance with their home jurisdiction regulation (Note 1).
Recognising that UCITS funds offer robust investor protection on par with Hong Kong’s standards, the SFC considers further streamlining appropriate after its thorough review and engagement with market participants. With the measures coming into effect today, the SFC estimates a drop of about 50% in the number of scheme change applications submitted by UCITS funds for its approval (Note 2).
Under the streamlined measures, the SFC no longer requires UCITS funds to seek its prior approval for changes to depositories and investment delegates supervised by the fund’s home regulator. Nor is the SFC’s approval needed for material changes in investment objectives, policies and restrictions which comply with its home jurisdiction requirements (Note 3). Additionally, the SFC aligns its notification requirements with those of the fund’s home jurisdiction.
“These enhancements are integral to the SFC’s ongoing efforts to strengthen Hong Kong’s competitiveness as a leading global asset management centre, enabling UCITS funds to operate efficiently in our dynamic market,” said Ms Alexandra Yeong, the SFC’s Interim Head of Investment Products. “Going forward, we will continue to enhance operational efficiency while remaining steadfast in upholding investor protection.”
To facilitate the industry’s understanding of the latest measures, the SFC also published updated FAQs on its website.
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Notes:
- UCITS funds means (i) Undertakings for Collective Investment in Transferable Securities (UCITS) domiciled in France, Luxembourg, Ireland and the Netherlands, and (ii) collective investment schemes domiciled in the United Kingdom authorised as UK UCITS.
- Based on the number of scheme changes applications submitted to the SFC by UCITS funds over the past 12 months, and the number of these applications that may be eligible for the proposed streamlined measures.
- Except for changes involving novel or complex product features or those with local policy implications.
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