CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. South African FSB Attempts To Clear Up Confusion Over Hedge Fund Approval

South African FSB Attempts To Clear Up Confusion Over Hedge Fund Approval

by Carla Johnson, Investors Offshore.com

09 March 2004


The South African investment industry was thrown into confusion last week after the Financial Services Board ordered all fund managers to stop selling hedge funds and alternative investment products, forcing the authorities to issue a clarification.

The controversy arose after the FSB sent a letter to approved fund managers, intended to clarify certain limitations relating to the Stock Exchanges Control Act, 1985 and The Financial Markets Control Act, 1989. Specifically, the letter stated that fund managers could not sell hedge fund products or alternative investment schemes to individuals and pension fund organisations until the FSB had determined the requirements under which these could be marketed and managed.

Reports indicate that the letter induced a certain amount of panic amongst investment managers, and the FSB, in tandem with the Alternative Investment Managers Association (South African Chapter) were forced to word an additional clarification in response.

"The approval granted to investment managers relates to their being approved to buy and sell securities on behalf of their clients. It does not provide them with any form of approval, tacit or implied, either to manage hedge funds or to sell hedge funds to individuals or pension fund investors," read the joint FSB/AIMA release.

"In terms of the current regulatory regime, hedge funds fall outside the scope of existing regulation and there is nothing preventing investment managers from conducting the business of a hedge fund provided that they do not represent to have been approved by the FSB to manage and/or solicit for investment into hedge funds," the statement continued, adding:

"It is therefore suggested that any hedge fund material should state such restrictions clearly on the face of such documentation and all participants in the hedge fund industry must ensure that they act responsibly in their conduct."


To see today's news, click here.

 















Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »



Stay Updated

Please enter your email address to join the Tax-News.com mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.


To manage your mailing list preferences, please click here »