Kuala Lumpur, 11 June 2009

SC revises guidelines to allow cross-listing of foreign ETFs

As part of its on-going efforts to enhance the depth and breadth of the capital market, the Securities Commission Malaysia (SC) today issued the revised Guidelines on Exchange-traded Funds (ETF Guidelines) to allow exchange-traded funds from recognised jurisdictions to be cross-listed on Bursa Malaysia.

The revision involves, among others, the addition of two new chapters into the existing ETF Guidelines specifically on Offering of Foreign ETFs on Bursa Securities and Application Procedures for Offering of Foreign ETFs on Bursa Securities. These chapters stipulate the application procedure and submission requirements for a foreign fund manager interested in offering their ETFs in Malaysia, and include the approval criteria, requirements of an offering document, the appointment and functions of a representative.

Under the revised Guidelines, a fund manager may seek secondary listing of a foreign ETF on Bursa Malaysia if it is from a recognised jurisdiction (as listed in the Guidelines for the Offering, Marketing & Distribution of Foreign Funds). It is also possible now to cross list a foreign ETF from a non-recognized jurisdiction with a regulatory regime comparable to Malaysia’s.       

The SC consulted selected fund managers in formulating the revision. In line with the recent reviews of the Guidelines on Unit Trust Funds and the Guidelines on Real Estate Investment Trusts, the provisions of the ETF Guidelines have also been streamlined for easier reference.

Currently, there are three ETFs listed on Bursa Malaysia Securities Berhad and they are ABF Malaysia Bond Index Fund, FBM 30 ETF and MyETF Dow Jones Islamic Market Malaysia Titans 25.

The revised ETF Guidelines which comes into effect on 12 June 2009 is now available here.