Japan govt to exempt small funds from new tighter law - report |
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Tue, 31 Jul 2007 23:36
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TOKYO (Thomson Financial) - Japan's Financial Services Agency (FSA) has decided to exempt some overseas funds that have a limited presence in Japan from a new financial products law in order to prevent tight regulations from sapping the vitality of the financial markets, the Nikkei reported on Wednesday.With the implementation on Sept 30 of a new law that covers wide-ranging financial products, the watchdog aims to create a fair and transparent market, protect participants and boost convenience, the business daily said, without citing sources.Under the new legislation, financial institutions, including banks, brokerages and insurance firms, will be required to follow specific marketing rules and provide customers with detailed explanations of the fees and potential losses they could incur, it said.Once the law takes effect, various types of funds, including those that invest in start-ups and engage in mergers and acquisitions, will come under the FSA's supervision, according to the report.But to dilute the impact of the sudden tightening of regulations, the agency has set grace periods of up to six months, enabling domestic and overseas funds to continue operating without taking compliance steps.For instance, foreign funds meeting certain conditions -- having less than 10 Japanese institutional investors that account for less than one-third of the total fund balance -- will be exempt from the new regulations, the Nikkei said.(1 US dollar = 118.55 yen)yasuhiko.seki@thomson.comyas/msCOPYRIGHTCopyright AFX News Limited 2007. All rights reserved.The copying, republication or redistribution of AFX News Content, including by framing or similar means, is expressly prohibited without the prior written consent of AFX News.
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