Changes to publication requirements for collective investment schemes

A one-month consultation on proposals to amend publication requirements relating to offer and redemption prices and net asset value and notices of dealing suspension under the Code on Unit Trusts and Mutual Funds (Code) ended on 23 July 2014. The proposals would give Hong Kong authorised collective investment schemes (Schemes) greater flexibility in determining the means for making public their offer and redemption prices, net asset values (NAVs) and notices of dealing suspension. They would also require more frequent dissemination of prices and NAVs.

The SFC proposals include:

• Removal of the requirement to publish offer and redemption prices or NAVs in newspapers allowing schemes to use other appropriate means to publish.
• Management companies must ensure when determining the appropriate means for publication that:
  1. holders or prospective investors can have free access to such information;
  2. disclosure is consistent with the manner and frequency at which the units are dealt in; and
  3. a dedicated channel of dissemination is specified in the offering document.
• Requirement for Schemes to publish their offer and redemption prices or NAVs on every dealing day (currently these are required to be published at least once a month).
• Removal of the requirement to publish dealing suspension notices in newspapers allowing schemes to use other appropriate means to publish (e.g. websites). The frequency for publication remains unchanged.

It is proposed that the amendments will apply to new Schemes from the date of publication in the government gazette. A transitional period of six months will apply for existing Schemes.