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The Asia Region Funds Passport aims to provide a multilaterally agreed framework to facilitate the cross border marketing of managed funds across participating economies in the Asia region.

Overview

The Asia Region Funds Passport is a region-wide initiative led by Australia, New Zealand, Republic of Korea and Singapore. Ministers representing the governments of these economies signed a Statement of Intent on 20 September 2013 at the APEC Finance Ministers’ meeting in Nusa Dua, Bali.

In signing the Statement of Intent, ministers of the four economies recognise the value of creating better connections between financial markets in the Asia region and the benefits deriving from it.

Ministers have signed with a view to their economies potentially becoming members of the passport upon its commencement in 2016.

They have endorsed the principles upon which the detailed passport arrangements will be based as set out in the framework document.

Public consultations on the arrangements in each of the signatories’ respective economies took place in early 2014.

In the longer term, the passport could also facilitate funds from the Asian region being marketed in Europe through an Asian/European mutual recognition agreement.

History

The passport was recommended by the Australian Financial Centre Forum in its 2010 report (known as the Johnson report).

Subsequently, the APEC Finance Ministers’ Process (FMP) to develop and gauge regional interest in the concept. FMP facilitated a region-wide working platform where finance policy makers, regulators, industry and technical experts could collaborate via policy dialogues and capacity building workshops.

Participants of related workshops (13 APEC economies namely, Australia, Singapore, Hong Kong, Japan, Republic of Korea, Thailand, Malaysia, Indonesia, Vietnam, the Philippines, the United States, Chinese Taipei and New Zealand), the economies were invited to create a working group that would develop the detailed technical arrangements. Australia, Republic of Korea, New Zealand and Singapore accepted this invitation.

PWC released a report commissioned by the Australian Financial Services Council in November 2010, that provided a qualitative analysis of reception to the ARFP idea and potential upside.

On 20 September 2013, finance ministers from Australia, South Korea, New Zealand and Singapore signed a Statement of Intent in Nusa Dua, Bali, Indonesia on the Asia Region Funds Passport.

The Governments of the working group economies publicly released a consultation paper, which contains the detailed passport arrangements.

In partnership with Volguard, APEC published a quantitative study in July 2014, of the economic benefits and costs of the ARFP to the individual economies and the Asia region. Through the extensive assessment conducted by Volguard Analytics, the potential gains from the ARFP were measured against their potential risks.