China – CSRC Side Pocket Guidelines

China – CSRC Side Pocket Guidelines

On 16 August 2019,  CHI CSRC, CHI AMAC drafted guidelines on side pocket.

  • CSRC drafted Guidelines on Mutual Funds Side Pocket Mechanism, seeking opinions.

Objective

  • Side pocket is an account used to differentiate illiquid from more liquid investments.
  • Refine measures for liquidity risk management in liquidity risk regulations to enrich fund managers' management tools in promoting the health of the public fund industry.
  • Provide institutional guarantee for public fund to explore product innovation, better serve the real economy, better meet the public investment needs, protect investors.

Contents

  • Guidelines consist of 17 articles, stipulating conditions for mechanism, investment arrangements, voting rights, information disclosure, responsibilities of involved parties.

Effectiveness

  • Open to public for opinions, which are to be sent to AMAC via email by 1 September 2019.