In a notice published last week, the Securities and Exchange Commission (SEC) said it was starting a consultation in a bid to give investors with a higher risk tolerance a greater choice of products.
It said was looking to revise investor qualifications to ensure the right kind of investor is eligible to invest in higher risk mutual funds.
The SEC also proposed relaxing the rules around investment policy of mutual funds offered to accredited investors in order to enhance competitiveness of asset management companies, giving investors an opportunity to invest in more diversified, complex types of mutual funds.
By offering a range of funds similar to those sold in foreign markets, it said it could help investors access a wider range of investment opportunities through various types of complex products.
"The market landscape and the business operation have generally become more diversified and more complex"
“The relaxation would allow mutual funds offered to accredited investors to invest in any types of financial instruments without company limit ratio, which has already been the case with hedge funds,” the regulator said.
In a separate note, the SEC has proposed revising the rules for listed financial companies in a bid to stop firms suffering “unnecessary burdens”, and to ensure the responsibilities of directors and financial advisers are reflective of real practice.
The body said it was starting a consultation on a proposed amendments to clarify the roles and responsibilities of boards of directors and advisers.
It also proposed:
- Laying out guidelines for good practice when firms execute transactions between subsidiaries
- Revising the criteria for reporting conflicts of interest of company directors
- Further clarifying what is meant by the term ‘related party’
“The current rules on listed companies’ transactions have been in use since 2003, while the market landscape and the business operation have generally become more diversified and more complex,” said SEC deputy secretary general, Chalee Chantanayingyong.
“This proposed amendment would fine-tune the governing rules and prevent unnecessary burdens on listed companies without compromising proper protection for shareholders.”
Last month, the SEC said it was going to tighten up its supervision of financial intermediaries.