South Korea will join four neighboring countries in Asia including Japan and Australia in cross-border sale of fund products, giving investors more investment options and fund operators easier access to overseas markets.
The Financial Services Commission (FSC) said on Tuesday that the government approved the revisions to the financial investment services and capital market law to introduce Asia Region Funds Passport system. The revision will take effect on May 27.
Under the Asia Region Funds Passport system, five countries – Korea, Japan, Thailand, Australia, and New Zealand – will be able to sell fund products registered in member countries under fast track procedures. The system will allow Korean funds faster inroads into other countries and vice versa for overseas-managed funds.
The five countries signed a memorandum of understanding in April, 2016. The four countries except Korea have already completed system improvement and entered cross-border sales of their funds.
Under the revision, fund manager should satisfy required conditions to register funds in Korea – own $1 million or more in equity and manage $500 million assets. It should also have two or more executives with five or more experience in financial management.
The FSC said that cross-border fund sales among the member countries will become more convenient, allowing local managers to expand their overseas portfolio and providing investors more fund options.
By Lee Eun-joo
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