Asian Hedge Fund Regulation Unlikely To Become Tougher, Experts Suggest

by Mary Swire, for LawAndTax-News.com, Hong Kong

14 July 2005

Speaking to the Wall Street Journal this week, investment experts have suggested that despite the increasing interest being shown by retail investors in the Asia-Pacific hedge fund sector, regulation of the higher-risk investment vehicles is unlikely to increase in stringency in the region.

"Generally, Asian regulators have grasped the hedge-fund nettle early, and fairly effectively," Peter Douglas, council member for the Singapore arm of the Alternative Investment Management Association told the business daily, suggesting that perhaps the SEC could pick up tips from regulators in the region.

In particular, the report suggested, Asian financial regulators caught on to the need for hedge funds to register more quickly than their US counterparts - hedge funds in the United States with more than 15 US clients or with at least $25 million in assets will only be obliged to register with the SEC from February of next year.

Quoting figures from hedge fund consulting firm Eurekahedge, the WSJ revealed that Asia-Pacific hedge fund assets are expected to grow 42% to 85 billion by the end of the year (from $60 billion at the end of 2004), and that the number of hedge funds established in the region is expected to increase from 533 at the end of last year to 600 in December 2005.

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