Select Committee on Treasury Minutes of Evidence


Letter from the Guernsey Regulator to the Financial Services Authority

  I attach a copy of a letter to HM Treasury10 for which you will gather that we lodged our new draft Class A Scheme Rules with them a few weeks ago, and are shortly to lodge our draft guidance note on independence.

  When we met at the end of January I undertook to let you have copies of the industry circulars we had sent out recently, and I enclose those; they include our most recent circular on promotion In the Bailiwick. This latter circular has been triggered in part by the activities of certain UK fund management groups, who have been promoting UK authorised unit trusts in Guernsey without previously registering them with the Commission.

  Finally, when we met in January I said I would let you have copies of my correspondence with Hugh Aldous at Robson Rhodes on the topic of high income shares of split-cap investment trusts. I am still concerned at the potentially incestuous nature of this business and we have been stepping up our required risk warnings as a consequence.

  When we met we agreed that the question of regulation of closed-end investment vehicles presented some interesting challenges, particularly since the available remedies for breach of prospectus undertakings, etc, seem to be limited. This seems to be an area where regulators could usefully initiate a broader dialogue. Since most closed-end Investment vehicles are exchange traded, it seems to me that this could fall quite easily within IOSCO's remit I wonder, therefore, whether it would be worth encouraging IOSCO to set up a working group on the regulation of closed-end investment vehicles.

  If you think it's an idea worth pursuing, we will write to the IOSCC Secretariat and put the idea forward.

9 April 2001

previous page contents

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2002
Prepared 6 December 2002