Asia supportive of funds passport proposal
Asia’s funds management industry strongly endorses the proposed development of an ‘Asia Funds Passport’, which would allow Australia to gain access to investment markets across Asia.
That is the bottom line of joint research report by PricewaterhouseCoopers (PwC) and the Financial Services Council (FSC), presented by the Prime Minister Julia Gillard at the Asia Pacific Economic Cooperation summit in Yokohama, Japan.
Titled ‘Asia Region Funds Passport: The future of the funds management industry in Asia’, the report found 86 per cent of the Asia Pacific region’s industry bodies and all market participants surveyed believe the establishment of an Asia Funds Passport was of importance to the growth of the funds management industry in the region.
Under an Asia Funds Passport, Australian fund managers would be able to offer and have access to investment funds throughout the Asia Pacific region — a concept to which the Financial Services Minister, Bill Shorten, has recently restated the Government’s commitment.
FSC chief executive officer John Brogden said there was a need for Australian retail investment products to be available for purchase throughout Australia, and that Australian superannuation funds and their members would benefit from accessing investment opportunities in Asian markets.
“An Asia Funds Passport would also increase competition in the funds management industry, resulting in lower investment costs,” Brogden added.
Asset management leader for PwC Australia Andrew Wilson pointed to complex challenges facing the region in the event of establishing the passport, particularly across differing legislative and tax regimes.
However, he said the challenges were not insurmountable.
“Of the 11 markets that were surveyed, there were many similarities between regulatory frameworks across areas such as disclosure requirements, custodian arrangements and approval processes,” Wilson added.
Presently, Australia has access to the New Zealand and Hong Kong markets under regulatory mutual recognition arrangements.
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