The Canadian Securities Administrators (CSA) announced the completion of the first phase of its “Modernization Project”, which seeks to update the product regulation of publicly offered investment funds.
The purpose of the Project is to modernize investment fund
regulation, making it more effective and relevant in today’s more
diverse and increasingly innovative retail marketplace.
Specifically, the amendments introduced in the first phase recognize
the proliferation of Exchange Traded Funds (ETFs) and streamline their
access to the market by eliminating the need for them to apply for
regulatory exemptions. This will reduce regulatory costs, which is also
expected to benefit investors. The amendments are also designed to
enhance the resilience of money market funds to certain short-term
market risks, by introducing new liquidity requirements and term
restrictions.
“By modernizing these important investment fund rules, we are
responding to the rapidly evolving investment fund landscape, as well as
maintaining consistency with global standards,” said Bill Rice, Chair
of the CSA, and Chair and Chief Executive Officer of the Alberta
Securities Commission.
Subject to ministerial approval, the amendments will come into force
April 30, 2012. The new requirements for money market funds will come
into force following a transition period.
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