The ARFP scheme, initially announced in 2013, aims to connect the mutual fund markets of Australia, Japan, Korea, New Zealand and Thailand. It is targeted for full implementation in 2018, according to the ARFP website.
In its latest move towards the implementation of ARFP, Japan’s Financial Services Agency issued guidelines for application procedures for registering under the scheme on 25 December. The guidelines include procedures for exporting funds from Japan, as well as importing them to Japan.
Just a few days earlier, Australia’s government announced that it was seeking public comment on draft legislation for ARFP.
This is the second round of consultation that the Australian government has launched in this matter. It should enable the legislation to be in place in the first half of 2018, according to a statement from the country’s treasury department.
“Investors will be able to access many more investment opportunities in our region through funds that are offered in Australia,” Kelly O’Dwyer, minister for revenue and financial services, said in the statement.
According to a mid-2017 report of the ARFP Joint Committee, the latest update available, other countries have also been working on legislation and regulations for their markets. In particular, New Zealand planned to finalise its regulations by the end of 2017 in order to be ready for the ARFP regime. Also in the second half of 2017, the government of Korea was preparing a legal amendment for the implementation of the ARFP.
Although the ARFP’s memorandum of cooperation was signed in 2016, the various countries involved had been under negotiation for more than six years as they have not been able to reach an agreement on taxation.
In addition to the five countries, Philippines and Singapore had also participated in the negotiations, but chose not to sign the memorandum of cooperation, pulling back on their involvement.
Other fund passporting schemes in the region include the Hong Kong-China Mutual Recognition of Funds and the Asean CIS scheme.
The Asean CIS connects the fund markets of Singapore, Malaysia and Thailand, but has not gained much traction since its launch in August 2014. So far, only six funds have been approved for retail sale by both home and host countries.