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Bailey McCann, Opalesque New York:

Regulation is becoming a key focus area for hedge funds outside crisis zones like the US & EU. Participants at the recent Opalesque Hong Kong Roundtable noted that even while regulation in the region has been steady since the local financial crisis in 1997, compliance with global regulatory requirements is becoming an important focus area for Hong Kong-based funds.

Financial regulations finalized by the Commodities Futures Trading Commission (CFTC) here in the US, along with provisions of the Dodd-Frank and FATCA measures will require funds operating outside the US to comply with US regulations if they intend on doing business with US investors. In the EU, a variety of financial directives from the European Commission also include compliance requirements for funds outside the US. Taken together, these regulations are adding to the cost and compliance burdens for start-up managers in funds outside these regions, like in Hong Kong.

Even within local regulatory bodies like the Hong Kong Securities and Futures Commission (SFC) rules are being re-interpreted in order to meet broader IOSCO / G20 obligations. Specifically the SFC has amended its short selling rules to require electronic reporting of short selling activity on a regular basis.

According to an article ......................

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