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The spokesman said section 27 of the Ordinance required that no scheme assets should consist of investment in the share capital of a company or body corporate the shares of which were not listed on the Unified Exchange or any stock market recognised by the SFC.
"Concerns have been expressed by scheme administrators and their investment managers about this restrictive provision which prohibits investment in shares listed on emerging stock markets in, for example, Taiwan, Indonesia and Spain. Unintentionally, this provision also bans investment in mutual funds.
"If the bill is enacted, scheme administrators may invest scheme assets without limit in mutual funds and up to 15 per cent in the listed shares of companies on stock exchanges not recognised by the Securities and Futures Commission but legally established and regulated as stock exchanges in accordance with the laws of the jurisdictions in which they are established.
"We consider these concerns justified and propose to relax the restriction, while continuing to prohibit investment in private companies," the spokesman said.
Additionally, the Bill also seeks to impose the requirement to obtain the approval of the Registrar of Occupational Retirement Schemes to make certain changes in the registered particulars of a scheme which may materially alter the grounds upon which the scheme has been registered or exempted, and to impose penalties for breaches of such requirements.
The proposed amendments will also enable the Registrar to amend the occupational retirement scheme register where circumstances so require; to prescribe the payment of fees for requested changes in scheme particulars; to cancel the registration of a scheme upon its termination or winding up; and to make rules relating to the approval and notification procedures for changes.
The Bill will be introduced into the Legislative Council on January 18.
End/Friday, January 6, 1995
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Private notes are available after approval.