Thailand Regulator Proposed Revision Concerning Proportion of Investment Unit Holding in Retail Fund

The Securities and Exchange Commission (SEC), Thailand is seeking public comment on proposed revision concerning proportion of investment unit holding in mutual fund for general investors (retail fund). The revision is based on existing key principles aiming to ensure that (i) retail fund’s investment units will be allocated to general investors; (ii) retail fund will not be used to seek undue benefit for any particular individual, in particular tax privilege; and (iii) any person or group of persons will not be allowed to dominate mutual fund management.

Key proposed revisions require retail fund and money market fund to comply with rule preventing any person or group of persons from holding more than 1/3 of total investment units sold which has already been applicable to other types of mutual funds. In case where any person or group of persons holds investment units in the amount exceeding the said limit, asset management company will be prohibited from distributing dividend and counting vote in the excess portion. The prohibition, however, will not apply if excess holding is not resulted from making additional investment, providing that asset management company must arrange to have appropriate measure to prevent other unitholders from being dominated, for example. 

The consultation paper is available on the SEC website at www.sec.or.th. Stakeholders and the interested public are welcome to submit comments through the website, or through facsimile number 0-2263-6332 until June 5, 2012.