New | Asia Region Funds Passport to launch next year

Finance officials and regulators from six Asia-Pacific countries will take the lead to streamline the procedures for financial services professionals to market investment products such as mutual funds to retail consumers in other Asia Pacific economies.

“We are working to finalise the rules and governing arrangements of the Asia Region Funds Passport for participating APEC members to sign on to by the end of 2015 and to begin piloting the scheme next year,” Manuel Gaite, Commissioner of the Philippines’ Securities and Exchange Commission, said in a statement on Thursday.

Australia, South Korea, New Zealand, the Philippines, Singapore and Thailand are leading the development of the Asia Region Fund Passport at a just concluded week of meetings in Singapore to iron out the details.

The initiative aims to cut down on incompatible or overlapping regulations that may hinder the marketing of managed funds between participating economies. A mutual fund is a type of professionally managed investment fund that pools money from many investors to purchase securities

Once the passport is fully up and running, it could save the regions’ investors US$20 billion annually in fund management costs, offer higher investment returns at the same or lower degree of risk, and encourage the establishment of locally domiciled funds which could create 170,000 jobs in APEC economies within five years, according to the APEC Policy Support Unit.

Officials and regulators from participating APEC members discussed feedback submitted during a second round of public consultations from the end of February to mid-April as well as possible amendments to a draft multilateral memorandum of understanding that outlines the rules and arrangements of the initiative.