FSA update on funds of alternative investment funds
14th November 2007The Financial Services Authority (FSA) today issued an update on its proposals to allow UK retail consumers to invest in funds of hedge funds and other alternative investments sold by firms authorised in the UK.
The FSA had planned to issue a policy statement and final rules towards the end of this year to allow the development of Funds of Alternative Investment Funds (FAIFs), including funds of hedge funds, within the retail market.
However, as the FSA identified in the consultation, there are a number of taxation issues involved in the operation of such a regime. HM Treasury is currently considering these issues in conjunction with the offshore funds regime on which a discussion paper was issued in October, with a deadline of 9 January 2008 for responses. Therefore, the FSA considers it appropriate to delay publication of its proposals until the situation is clearer, which is likely to be early in the New Year.
Dan Waters, FSA Director of Retail Policy and Themes, said:
"We recognise the difficulties of trying to resolve the complex issues raised by the Offshore Funds Tax Regime. We continue in our constructive discussions with the Treasury however and are working closely together to find a way for FAIFs to operate competitively within the UK retail market. This provides an opportunity for further discussion and consideration before the final publication."
