Jeremy Lam, Partner and Head of FSPG was recently featured in a topical Ignites Asia article entitled ‘HK’s new open-ended fund regime garners “mild interest”’. The article was also the ‘Editor’s Choice’ on the day it was published.
Hong Kong’s new open-ended fund company framework came into effect on Monday 30 July. The article discusses why asset managers may be unlikely to adopt the new fund structure, and why the new framework does little to attract new entrants to help grow the local asset management industry as intended. Only a few companies are expected to embrace this new fund structure, be it in the public or private fund space.
"I don't anticipate from day one there is going to be an immediate rush to set up this structure" commented Jeremy. There are just a handful of organisations that are “relatively keen” to launch an OFC fund in the foreseeable future.
Jeremy goes on to explain that he has fielded some enquiries from clients in recent months, mainly from asset management companies considering OFC vehicles for retail investors rather than those using the structure for private funds.
The enquiries came from both companies with and without existing unit trust structures domiciled in Hong Kong. Companies with existing retail Ucits funds domiciled in Europe are unlikely to want to redomicile them to Hong Kong for the new OFC structure, as they will lose their wider passporting capabilities, but those with existing Cayman fund structures could view the OFC as a more attractive option.
Read the full article here (subscription required).
Ignites Asia is a Financial Times service, and is an online news source specifically for the Asian asset management industry. It is the sister publication to Ignites, the most popular fund industry news source in the United States.