Global Asset Managers Regulation Introduction

What are International Regulatory Standards?

• Approaches to either formalise common practice, such as, approaches to liquidity management
• To deliver political commitments designed by international standards setters

How do International Standards impact funds?

• Influence regional laws and local laws
• Can great extraterritoriality
• Alter compliance obligations for funds and/or development of global compliance policies (e.g. remuneration)

How can International Standards become Extraterritorial?

• Standards can act in foreign jurisdictions where funds have activities overseas
• Can create competing compliance obligations
• Local rules for fund authorisation
• Local rules for distribution
• Foreign investment rules

Which International Standard Setters are relevant to funds?

• G20 leaders and the FSB group of central bank governors, finance ministries and regulators
• Joint Forum of key international regulators, including IOSCO – international group of securities regulators
• OECD, World Bank and standards boards such as the International Accounting Standards Board

How are different cross-border funds regulated?

Regulation applies to a fund’s overseas activities all across the value chain. The three main approaches to cross-border fund regulation are national treatment, passporting and recognition both bilateral or unilateral.

How is Foreign Distribution Regulated?

• Foreign distribution is subject to local rules where the investor is inc disclosures and reporting obligations
• Rules may include; point of sale disclosures, regulatory reporting obligations and a restriction on fee payments to distributors

How is Foreign Portfolio Management Regulated?

• Substance rules for delegating firms may apply. These can include; minimum levels of resource, local government standards and operational systems and controls
• Local rules for portfolio managers may impact. For example, an assessment of a portfolio managers local regulatory regime and licensing obligations for the foreign portfolio manager

How are Foreign Investments Regulated?

• Capital controls and repatriation considerations
• This may include: taxation considerations, exposure limitations, sell-side engagement rules and regulatory reporting obligations

What is hot on the Global Regulatory Standards agenda?