中国证券投资基金业协会

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The CSRC Seeks Public Comments on the Interim Measures for Supervision over Risk Provisions of Publicly Offered Securities Investment Funds (Consultation Draft)

[2013-06-18]

 

On March 14, the CSRC issued the Interim Measures for Supervision over Risk Provisions of Publicly Offered Securities Investment Funds (Consultation Draft) (hereinafter referred to as the Interim Measures) and started the solicitation of public comments.

 

According to the head of the relevant department of the CSRC, the fund industry officially established the risk provision program in 2006. During the 6 odd years following its implementation, the program has been used on several occasions to address risks by timely covering the loss of fund property and fund share holders. Practice has proven that the risk provision program is essential in reinforcing the capabilities of the fund industry to guard against risks, protecting the interests of investors and facilitating the sound development of the industry.

 

With the continuous development of the fund industry over the past few years, all fund managers and custodians have become increasingly more aware of risk prevention and control in the investment operation of publicly offered funds and reached a preliminary consensus on the importance and the necessity of the risk provision program. Meanwhile, various market participants have long been yearning for the adjustment and improvement of the risk provision program in order to be further adaptable to the demand of the development of the industry. The newly revised Securities Investment Fund Law (hereinafter referred to as the Fund Law) gives responses to the market demand. Pursuant to Articles 23 and 39 of the Fund Law, fund managers of publicly offered funds shall withdraw risk provisions from management fee income and fund custodians shall also withdraw risk provisions from custody fee income. In order to implement the Fund Law, continue to explore and effectively exploit the advantages of this program and further boost the efficiency of risk provision management and utilization as well as the overall capability of the fund industry to withstand risks, it is imperative to make timely overall planning for the risk provision program within the industry, design a proper top-level regime and improve the development of the system of relevant regulations. Based on the above considerations and taking into account various opinions from all participants in the industry, the CSRC has recently drafted the Interim Measures to make uniform provisions on the management and operation of the risk provisions of publicly offered funds.

 

The Interim Measures mainly consist of the following contents: 1. specifying the applicability and special purposes of the risk provision program for publicly offered funds; 2. establishing the risk provision management system of fund custodians, improving administrative rules on risk reserves of fund managers and expanding the investment scope, as well as clarifying the arrangements regarding the risk provisions of fun managers and custodians in opening accounts, fund transfer and utilization; 3. reinforcing the centralized and standardized management mechanism for risk provisions in the fund industry, ensuring the compliant management of risk provisions of fund managers and custodians and effectively safeguarding the lawful interests and rights of holders of publicly offered funds.

 

The above official said, as its further action, the CSRC will, on the basis of comments from the general public, revise the Interim Measures and issue the Interim Measures as revised for simultaneous implementation with the Fund Law.

 

Source: CSRC

http://www.csrc.gov.cn/pub/csrc_en/newsfacts/release/201304/t20130407_223095.htm