Asia Region Fund Passport

John Brogden_FSC_at EACJohn Brogden, then CEO Financial Services Council, was special guest at the Sydney Expat Advisors Community forum in April 2014. The FSC represents Australia’s retail and wholesale funds management businesses, superannuation funds, life insurers, financial advisory networks, trustee companies and public trustees.

Australia Week in China (AWIC) – April 2014

John Brogden lead the finance aspect of the Prime Ministers delegation to AWIC with business leaders including the heads of all the major banks, showing how important the financial services sector of the economy is for our relationship with Asia.

The purpose of the Prime Ministers delegation was to promote cooperation in trade, investment, tourism and education between Australia and China. The Chinese were very impressed with all the politicians attending right down the various ministers.

The size of Australia’s mining sector and to some extent agriculture is well known, but not many realise how large financial services is as a percentage of GDP, and our world class capabilities. It is easy to export what you dig out of the ground, but financial services are much trickier.

The opportunity for Financial Services is exporting our capabilities to the region:

“China has an aging population, which will need financial products to assist them to have a prosperous and enjoyable, and hopefully long, retirement. Australia has a significant expertise in retirement markets so could be a good partner for China” – John Brogden

Asia Region Funds Passport

The purpose of the Asia Regions Funds Passport is to have a model for free trade in investment funds across Asia. Currently 80% of managed funds in Asia are actually domiciled out of Europe.

A number of countries have signed up so far, although not yet China. With each country having its own legislative regime and tax environment there is much to be worked through. An example of how it might work is funds in Korea, being managed by Australia, into Singapore assets.

The rest of the world doesn’t recognise Australia’s various entities so a new managed investment structure is being developed and some tax concessions may be required ahead of the 2016 launch.

The governments of the Asia Region Funds Passport working group have released in February 2015 draft rules and operational arrangements and are seeking further input.

For more information go to the APEC website here.