Hong Kong to simplify licensing of hedge funds
HONG KONG, June 11 |
HONG KONG, June 11 (Reuters) - Hong Kong's securities watchdog said on Monday it is simplifying licensing requirements, with immediate effect, for overseas hedge fund managers looking to set up in the territory.
Hong Kong's Securities and Futures Commission (SFC) said the changes include speeding up the licensing process for some U.S. and UK-registered hedge fund managers, and exempting some staff at hedge funds from having to take exams.
Hong Kong is home to more hedge fund assets than any other Asian city. But a growing number of hedge fund managers are choosing to set up in Singapore, where authorities have sought to attract the industry with accommodative regulation.
The Hong Kong regulator said on Monday firms already licensed or registered in the United States or Britain will "benefit from an expedited licensing process", assuming they only serve professional investors and have good compliance records.
It said staff nominated to be the "responsible officers" of hedge fund firms can also be exempted from the local regulatory examination if they fulfil the necessary criteria. A broader range of industry experience will also be recognised as satisfying the competence requirements, it added.
The regulator said earlier this month there have been many complaints from market participants that the exams they are required to take to obtain licences are difficult and irrelevant.
"These initiatives will make the licensing process easier for fund managers and more particularly for overseas hedge fund managers," Alexa Lam, an SFC executive, said in a statement.
"They are not intended to lower our regulatory requirements because we recognise that these contribute to Hong Kong's reputation amongst investors."
An SFC survey released last year said there were 118 hedge fund managers operating in the territory with $33.5 billion under management.
Asia's hedge fund industry has boomed in recent years, with assets under management rising 30 percent last year to reach $132 billion, according hedge fund research firm and consultancy Eurekahedge. This has since risen to $146 billion managed by more than 1,100 funds, it said.
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