Signing of the Statement of Understanding

On 11 September 2015, Finance Ministers from Australia, Japan, Korea, New Zealand, the Philippines and Thailand signed a Statement of Understanding at the APEC Finance Ministers’ Meeting in Cebu, the Philippines on the Asia Region Funds Passport. The statement signals the commitment of these economies to join the Passport ahead of its commencement in 2016. The statement also notes the intention of signatories to ensure that all APEC economies are able to participate in the Passport when it begins or at a time appropriate to their circumstances.

The next milestone will be the signing of the Memorandum of Cooperation by participating securities regulators by the end of 2015.

Related media release

1. Asia Region Funds Passport provides opportunity for Australia’s financial services sector, Finance Minister and Assistant Treasurer joint media release

Signing of the Statement of Understanding

On 11 September 2015, Finance Ministers from Australia, Japan, Korea, New Zealand, the Philippines and Thailand signed a Statement of Understanding at the APEC Finance Ministers’ Meeting in Cebu, the Philippines on the Asia Region Funds Passport. The statement signals the commitment of these economies to join the Passport ahead of its commencement in 2016. The statement also notes the intention of signatories to ensure that all APEC economies are able to participate in the Passport when it begins or at a time appropriate to their circumstances.

The next milestone will be the signing of the Memorandum of Cooperation by participating securities regulators by the end of 2015.

Related media release

1. Asia Region Funds Passport provides opportunity for Australia’s financial services sector, Finance Minister and Assistant Treasurer joint media release

Signing of the Statement of Understanding

On 11 September 2015, Finance Ministers from Australia, Japan, Korea, New Zealand, the Philippines and Thailand signed a Statement of Understanding at the APEC Finance Ministers’ Meeting in Cebu, the Philippines on the Asia Region Funds Passport. The statement signals the commitment of these economies to join the Passport ahead of its commencement in 2016. The statement also notes the intention of signatories to ensure that all APEC economies are able to participate in the Passport when it begins or at a time appropriate to their circumstances.

The next milestone will be the signing of the Memorandum of Cooperation by participating securities regulators by the end of 2015.

Related media release

1. Asia Region Funds Passport provides opportunity for Australia’s financial services sector, Finance Minister and Assistant Treasurer joint media release

New Zealand has completed implementation

New Zealand confirmed to the Joint Committee today that it has completed preparations for implementing the Asia Region Funds Passport arrangements in New Zealand. It is ready to receive registration applications from local prospective passport funds and entry applications from foreign passport funds. For information on the passport in New Zealand visit the New Zealand Financial Markets Authority’s website.

Joint Committee Meeting 8-9 May 2019, Seoul

The Asia Region Funds Passport (“Passport”) Joint Committee (“JC”) held its sixth face-to-face meeting in Seoul, Republic of Korea on 8 and 9 May 2019, hosted by the Financial Services Commission of Korea. The meeting was attended by representatives from Australia, Japan, New Zealand (Chair), Republic of Korea (Deputy Chair) and Thailand. The JC was pleased to welcome representatives from the Securities and Futures Bureau of Chinese Taipei, the Securities and Futures Commission of Hong Kong and the Monetary Authority of Singapore who attended the meeting in an observer capacity.

The Passport is intended to provide significant benefits to investors through more fund choice, while maintaining effective legal and regulatory arrangements for investor protection. It is also intended to strengthen the capacity, depth, expertise and international competitiveness of financial markets and the funds industry in the region.

Progress of Passport

The Passport commenced on 1 February 2019 with Japan, Thailand and Australia able to receive and process registration applications from local prospective Passport funds and entry applications from foreign Passport funds from this date.  New Zealand has consulted on draft regulations required to implement the rules into New Zealand law.  It anticipates that it will complete preparations for implementation and be ready to receive registration applications under the ARFP by the end of July 2019.  The Republic of Korea continues to make progress with the legal and regulatory requirements for implementation required in its jurisdiction.  It has fully drafted sub-regulations and awaits the passage of the Passport Bill at the National Assembly.

Now that the Passport is in operation, the JC encourages industry to collaborate and engage across the region on operational and practical aspects of offering Passport funds. Each JC member will work with their local industry to facilitate this.

A new initiative established by the JC in 2019 has been to hold a dedicated observer discussion session on Day 2 of the JC meeting. The purpose of this session is to provide an opportunity for dialogue between the JC and potential new members about the opportunities and practical considerations associated with joining the Passport.

The JC discussed the future direction of the Passport including possible ways to extend the Passport across the region, drive uptake and interoperability with other passport arrangements.

Industry outreach

The JC discussed strategies to continue to closely engage with industry throughout the region to ensure that the Passport would meet industry needs.

The JC welcomed the Industry Day event arranged by the Korea Financial Investment Association that is to be held on 10 May 2019 in Seoul. Over 200 stakeholders are expected from around the Region.  The Vice-Chairman of the Financial Services Commission of Korea, Kim Yong Beom, will open the event.  Attendees will hear from JC members and industry about opportunities and challenges including on the vision and values of ARFP for globalization of the asset management industry, fund taxation in the five ARFP countries, and the opportunities for service providers.

Next Meeting

The next face-to-face meeting of the JC is planned to take place in Singapore in October 2019.

Background

The Passport will enable cross-border offerings of managed funds to retail investors while maintaining appropriate investor protections. It was established through the APEC Finance Ministers’ Process.

In June 2016, Australia, Japan, the Republic of Korea, New Zealand and Thailand entered into a memorandum of co-operation (“MoC”). The JC was established under the MoC to oversee the effective implementation and operation of the Passport.

9 May 2019

The Asia Region Funds Passport is live

The Asia Region Funds Passport (“Passport”) is now live.

Japan, Thailand and Australia are ready to receive registration applications from local prospective Passport funds and entry applications from foreign Passport funds.

For further information about becoming registered as a Passport fund in Australia, Japan or Thailand please see the following webpage links below:

New Zealand and Korea continue to make progress with the legal and regulatory requirements for implementation required in their respective jurisdictions.

Next Meeting

The next face-to-face meeting of the Joint Committee (JC) of the Passport will be held in Seoul, the Republic of Korea in early May 2019.

Background

The Passport will enable cross-border offerings of managed funds to retail investors while maintaining appropriate investor protections. It was established through the APEC Finance Ministers’ Process.

In June 2016, Australia, Japan, the Republic of Korea, New Zealand and Thailand entered into a memorandum of co-operation (“MoC”). The JC was established under the MoC to oversee the effective implementation and operation of the Passport.

The Passport aims to provide significant benefits to investors through enabling greater fund choice, while maintaining effective legal and regulatory arrangements for investor protection.

It is also intended to strengthen the capacity, expertise and international competitiveness of the funds industry and financial markets in the region.
The current chair of the JC is the Financial Markets Authority of New Zealand with the Financial Services Commission of the Republic of Korea the current vice-chair.

1 February 2019

The Journey Begins

Thanks for joining me!

Good company in a journey makes the way seem shorter. — Izaak Walton

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Launch of the Asia Region Funds Passport – Joint Committee Meeting 19-20 September 2018

The Asia Region Funds Passport (“Passport”) Joint Committee (“JC”) has decided that the Passport will launch on 1 February 2019.

This was agreed at the fifth face-to-face meeting of the JC in Auckland, New Zealand on 19 and 20 September 2018.

The meeting was hosted by the Financial Markets Authority of New Zealand (Chair) and attended by representatives from Thailand (Deputy Chair), Australia, Japan and the Republic of Korea. Representatives from the Monetary Authority of Singapore, and Securities and Futures Bureau of Chinese Taipei attended the meeting in an observer capacity.

Implementation Progress

Japan, Thailand and Australia have completed preparations for implementation and the Republic of Korea and New Zealand are well advanced in the legal and regulatory requirements required in their respective jurisdictions.

A number of funds have used the pilot process to obtain registration in their Home Economy and this has helped improve efficiency and effectiveness in relation to dealing with these applications. However, Host Economy arrangements have not yet been fully tested.

Ahead of 1 February 2019 operators may continue to consider how the Passport arrangements will apply in each economy and prepare to make applications. Passport regulators will continue to assist operators in this period by providing information and clarification on the regulatory requirements in their jurisdictions. Applications from prospective passport funds in their Home Economies may be made but funds will not be registered before 1 February. After 1 February, applications can be made by passport funds to Host Economies to allow cross-border offers.

Regulators may continue to deal with a fund on a pilot-like basis for the period up to and beyond 1 February. Host Economy requirements and processes will also continue to be tested and refined over this period to ensure they are practicable.

Now that the commencement date has been announced, the JC encourages industry to collaborate and engage across the region on operational and practical aspects of offering passport funds. Each JC member will work with their local industry to facilitate this.

The JC welcomed the Industry Day event arranged by the New Zealand Financial Services Council that is to be held on 21 September 2018 in Auckland. Over 70 stakeholders are expected from around the region. They will hear from JC members and industry about opportunities and drivers for success relating to the Passport.

The JC has published the Annual Implementation Report for 2017 – 2018.

New member initiatives

The JC considered further initiatives to extend the Passport to new economies and noted continuing discussions in a number of economies in the region who have the potential to join as participants.

Passport guidance

As legislation has been drafted and administrative arrangements put in place, some additional clarity can now be provided about the laws that will apply in each economy to incoming passport funds.

The JC has revised the published guidance and it is available on the ARFP website.

The revised guidance updates some key Host Economy regulatory matters applicable to passport fund operators seeking entry to Host Economies.

Tax reference group

The JC heard a presentation from Australian Treasury on behalf of the tax reference group. The presentation reiterated the objectives of the group. These are to support information sharing and cooperation but do not include harmonization of tax arrangements between economies.

Case studies showing the operation of New Zealand tax laws were discussed, and the JC noted similar material was being prepared by other members of the tax reference group to ensure clarity and provide a basis for any bilateral discussions that may be appropriate.

The reference group is examining what information could be published in time to support the launch in February.

Next Meeting

The next face-to-face meeting of the JC is planned to be held in Seoul, the Republic of Korea in April 2019.

Background

The Passport will enable cross-border offerings of managed funds to retail investors while maintaining appropriate investor protections. It was established through the APEC Finance Ministers’ Process.

In June 2016, Australia, Japan, the Republic of Korea, New Zealand and Thailand entered into a memorandum of co-operation (“MoC”). The JC was established under the MoC to oversee the effective implementation and operation of the Passport.

The Passport aims to provide significant benefits to investors through enabling greater fund choice, while maintaining effective legal and regulatory arrangements for investor protection.

It is also intended to strengthen the capacity, expertise and international competitiveness of the funds industry and financial markets in the region.

 

20 September 2018

Next steps to the Asia Region Funds Passport – Joint Committee Meeting 25 – 26 April 2018

The Asia Region Funds Passport (“Passport”) Joint Committee (“JC”) held its fourth face-to-face meeting in Sydney Australia on 25 and 26 April 2018, hosted by the Australian Securities and Investments Commission. The meeting was attended by representatives from Australia (Chair), Thailand (Deputy Chair), Japan, Republic of Korea and New Zealand. The JC was pleased to welcome representatives from the Monetary Authority of Singapore, the Securities and Exchange Commission of the Philippines and the Securities and Futures Commission of Hong Kong, who attended the meeting in an observer capacity.

The Passport is intended to provide significant benefits to investors through more fund choice, while maintaining effective legal and regulatory arrangement for investor protection. It is also intended to strengthen the capacity, expertise and international competitiveness of financial markets and the funds industry in the region.

Implementation Progress

The participating economies have progressed with legal and regulatory requirements in their respective jurisdictions. Japan and Thailand have completed their preparation. In Australia legislation is before Parliament. In the Republic of Korea there has been consultation on the required legislation and it is expected to be put before National Assembly by June 2018. In New Zealand, the Passport Rules are in the course of being incorporated into legislation.

A piloting process is underway to test arrangements. A number of fund managers and service providers are participating in the pilot with regulators. The pilot is expected to include making and considering applications and getting legal and tax advice.

The pilot process is expected to run until July 2018. The formal commencement of the Passport is expected to occur in around August 2018, once the JC has considered the results of the pilot. The JC will make a separate announcement about commencement.

The Chair of the JC, Mr Geoff McCarthy of the Australian Securities and Investments Commission, said:

“It is pleasing to see the efforts being put into ensuring the successful operation of the Passport. Before formal commencement the JC wants to consider the experience from the piloting process testing the arrangements with real funds.”

Industry outreach

The JC discussed strategies to continue to closely engage with industry throughout the region to ensure that the Passport would meet industry needs.

The JC welcomed the Industry Day event arranged by the Australian Securities and Investment Commission that is to be held on 27 April in Sydney. Over 90 stakeholders are expected from around the Region, who will hear from JC members and industry about opportunities and challenges including on taxation, streamlining of regulation and the opportunities for service providers.

New member initiatives

The JC considered further initiatives to extend the Passport across the region and noted continuing discussions in a number of economies in the region who have the potential to join as participants.

Passport guidance

As legislation has been drafted and administrative arrangements put in place, some additional clarity can now be provided about the laws that will apply in each economy to incoming Passport Funds. The JC has been revising the published guidance and will publish an updated version in coming months.

Tax working group

The JC heard a presentation from the Tax working group. The presentation gave additional clarity around taxation applying in relation to incoming passport funds in Australia. Cameos showing the operation of Australian tax laws were discussed, and the JC noted similar material was being prepared by other members of the Tax working group to ensure clarity and provide a basis for any bilateral discussions that may be appropriate.

Next Meeting

The next face to face meeting of the JC will be planned for September – October 2018 in New Zealand.

Background

The Passport is a multilateral framework to facilitate cross-border offerings of a variety of fund structures to retail investors while maintaining appropriate investor protections. It was established under the auspices of the APEC Finance Ministers’ Process.

In June 2016, Australia, Japan, Republic of Korea, New Zealand and Thailand entered into a memorandum of co-operation (MoC). The JC was established under the MoC to oversee the effective implementation and operation of the Passport.

26 April 2018

Asia Region Funds Passport – Pilot Program

Expressions of interest are being sought to participate in a Pilot Program for the Asia Region Funds Passport (ARFP) in early 2018 from:

  • Home country fund operator (exporter);
  • Host country distributor (importer); and
  • Key legal and tax-related advisory service providers.

Expressions of interest can be submitted for each of the roles individually or as a group.

To participate in the Pilot Program, applicants for the role of fund operator are expected to be an entity that is eligible to operate a Passport fund and have a fund that meets the criteria to apply for registration as a Passport fund. Distributors and providers of legal and tax-related advisory services are expected to be relevantly licensed and qualified to provide such services.

The Pilot Program will:

  • test Home Regulator and Host Regulator processes;
  • test taxation treatment of Passport Funds by Host country taxation authorities;
  • identify areas of ARFP processes that may require further development of the Passport Rules before the ARFP goes live;
  • identify any remaining barriers in Host countries.

Participants must be willing to provide regular feedback about their experiences to participating economies and may be required to participate in media about the findings of the Pilot Program.

Participants of the Pilot Program will be under no obligation to take part in the ARFP following the completion of the Pilot Program. However, they will be expected to promote their participation in the Pilot Program, and the ARFP.

To express interest in these roles, an applicant should complete a short letter explaining how they meet the eligbility criteria requirements. Applicants should contact their local regulator or industry body for more information.

About the Asia Region Funds Passport

The ARFP is a multi-lateral agreement between Australia, Japan, Republic of Korea, New Zealand and Thailand. It is intended to establish a regional market for collective investment schemes by facilitating cross-border offerings across these countries. The ARFP aims to reduce regulatory duplication by establishing a standardised set of requirements for fund operators, and benefit investors through broader and more diverse fund offerings while maintaining investor protection.

The Joint Committee is the governing body of the ARFP. It was established under the Memorandum of Cooperation on the Establishment and Implementation of the Asia Region Funds Passport.


Downloads:

Pilot Program – Expression of Interest [DOCX 108KB]

Next steps to the Asia Region Funds Passport – Joint Committee Meeting 3-4 October 2017

The Asia Region Funds Passport ("Passport") Joint Committee ("JC") held its third face-to-face meeting in Bangkok, Thailand, on 3 – 4 October 2017, hosted by the Securities and Exchange Commission of Thailand, and was attended by representatives from Australia (Chair), Thailand (Deputy Chair), Japan, South Korea and New Zealand. The JC was pleased to welcome representatives from the Monetary Authority of Singapore, who attended the meeting in an observer capacity.

Implementation Progress

The participating economies are finalising legal and regulatory requirements in their respective jurisdictions. This has involved considerable work and consultation in each jurisdiction to date. It is expected that this work will be completed in the next few months and that the Passport will commence in the first half of 2018 (when at least two participating economies have formally confirmed implementation has been completed).

The Chair of the JC, Mr Gerard Fitzpatrick of the Australian Securities and Investments Commission, said:

“It is important to recognise the significant benefits that may result from the successful operation of the Passport. Good progress is being made by the member economies in implementing the Passport and in a range of areas that will underpin its operation.”

The JC gave further consideration to an industry pilot to test the practical application of the Passport arrangements in each economy and welcomes industry initiatives in this area.

New member initiatives

The JC considered initiatives to extend the Passport across the region and welcomed the technical consultation workshop for non-participating economies to take place in KL in November. The JC also identified a number of enhancements to the "Memorandum of Cooperation on the Establishment and Implementation of the Asia Region Funds Passport" (MoC) to provide flexibility to meet the future growth and development of the passport. In looking to the future of the passport, the JC recognised the potential for further harmonisation across the different economies’ legal and regulatory regimes.

Passport guidance consultation

The JC considered the responses to its earlier consultation of the host economy laws and regulations and will shortly publish on its website fundspassport.apec.org an update to the guidance and feedback on the submissions. The JC also finalised its approach to the common parts of the Passport application.

Tax working group

The JC welcomed the upcoming meeting of its tax working group to occur in October. The aim of the group is to harmonise to the extent practicable, tax laws affecting the Passport. Its guiding principle is to achieve tax neutrality between home and host country passport funds.

Following the meeting, JC members discussed progress on the Passport with representatives of the funds industry from across Asia at a seminar on the Passport organised by the Stock Exchange of Thailand.

Mr Fitzpatrick said: “The Joint Committee welcomes the ongoing engagement with industry in the development of the Passport and looks forward to seeing funds prepare to offer through the Passport.”

The JC proposes to hold its next face-to-face meeting in Australia in early 2018.

Background

The Passport is intended to provide benefits to investors through broader and more diverse fund offerings, while maintaining effective legal and regulatory arrangement for investor protection. It is also intended to strengthen the capacity, expertise and international competitiveness of financial markets and the funds industry and to grow the pool of funds available in the region.

The JC was established under the MoC to oversee the effective implementation and operation of the Passport which was entered into by Australia, Japan, Korea, New Zealand and Thailand in June 2016.

13 October 2017

Release of Annual Report and Guidance

Release of Annual Report

The Asia Region Funds Passport (ARFP) Joint Committee has published its first Annual Report on its website. The Annual Report provides updates on each participating economy’s progress in implementing the ARFP Memorandum of Co–operation (MoC). This report represents a cooperative effort by Japan, Australia, New Zealand, South Korea and Thailand.

The Annual Report covers the 2016-17 financial year. During this period, all ARFP economies began implementing ARFP arrangements in their economies and the Joint Committee held its first two face-to-face meetings. During these meetings, the ARFP economies co–ordinated their implementation plans and discussed issues including tax and fund back–office processing.

The Annual Report also contains:

  • summaries of Joint Committee meetings held in November 2016 and April 2017
  • an update on progress of tax issues
  • a summary of discussions on back-office fund processing
  • summaries of engagement with potential participant economies and industry
  • an example application form setting out minimum requirements for a fund’s entry into a ARFP economy, subject to any additional regulatory requirements.

Consultation on ARFP Guidance

The Joint Committee has also released general regulatory information to assist operators of collective investment schemes seeking entry in any of the ARFP economies. This is to assist in the initial assessment of the requirements of the ARFP and is not intended as a substitution for legal advice.

Public consultation on the interim guidance is open for 8 weeks. Submitters are encouraged to address their submission to their relevant regulating authority. Contact information for submissions is available on the ARFP website.

25 July 2017

Asia Region Funds Passport – Joint Committee Meeting 20-21 April 2017

The Asia Region Funds Passport (“Passport”) Joint Committee (JC) held its second face to face meeting in Tokyo, Japan on 20-21 April 2017.

The JC was established under the Memorandum of Cooperation for the Passport. An important role of the JC is to oversee the effective implementation of the Passport by the end of 2017.

The second meeting of the JC was held in Tokyo, Japan and the representatives attended from Japan (Chair), Australia (Vice-Chair), Korea, New Zealand, and Thailand.

The JC received updates on the progress of implementation of member economies. The JC also discussed information sharing, developing common elements in the application content to be used by Passport funds and the feasibility of a pilot study with industry as a part of the implementation process.

The JC agreed:

  • to publish in July the 2017 Annual Report which will include information about progress in preparing for the operation of the passport;
  • to publicly consult in July on draft guidance about laws and regulations that are expected to apply to imported funds in “host” passport economies;
  • to continue to engage with and reach out to other economies in the Asia Region that are not participants at the moment; and
  • for Australia to chair a working group of tax specialists to meet in early June to consider what information can be given to funds and investors on the tax treatment.

The Chair of the JC, Mr Jumpei Miwa of Japan Financial Services Agency, said:

‘It is pleasing to see the significant efforts being taken by agencies in all member economies and the engagement of industry. We are looking forward to effective implementation of the Passport’.

After the formal agenda was concluded, the JC Members had interactive discussions with Japanese fund managers that are interested in the ARFP following presentations from the Japan Securities Dealers Association (JSDA) and the Japan Investment Trusts Association (JITA).

The JC appreciates the continuing open and consultative approach with the industry in the development of the Passport.

The next in-person JC meeting is proposed to be held in October 2017 in Thailand.