Consultation paper on Listed and Unlisted Investment Products

On January 28 MAS issued a consultation paper on the Regulatory Regime for Listed and Unlisted Investment Products. This consultation paper is part of the second response MAS issued to a consultation process undertaken in March 2009 on unlisted investment products.

The main proposals, contained in the consultation paper, focus on a new obligation on financial advisers and brokers to formally assess a retail customer's investment knowledge or experience before selling investment products to the customer. It is proposed that the new obligations will apply for all investment products other than a list of products which are already established in the market and generally understandable by retail investors. MAS will prescribe the list of products that will be excluded from the new obligations.

MAS have also included the following proposals in this consultation paper:

(i) Expanding the scope of the CMFAS examination module that was planned for the three classes of unlisted "complex investment products" consulted in March 2009 to cover other non-excluded investment products; and

(ii) Requiring issuers of debentures which are asset-backed securities and structured notes, collective investment schemes and sub-funds of investment-linked life insurance policies to prepare Product Highlights Sheets.

Responses to this consultation paper are due to MAS by 12 March 2010