The Securities and Exchange Commission of Pakistan has strengthened its regulatory framework for the mutual fund industry by specifying detailed requirements for “Investment Plans”, building on enabling amendments to the Non-Banking Finance Companies and Notified Entities Regulations, 2008. The measures are intended to enhance governance and operational clarity for such plans and support investor protection. Developed following consultation with stakeholders including the Mutual Funds Association of Pakistan, the framework sets out which Collective Investment Scheme categories Asset Management Companies may use to offer Investment Plans, including Fund of Funds, Fixed Rate/Return, Sovereign Income, Asset Allocation Schemes, Capital Protected and Exchange Traded Funds. It also introduces operational parameters covering the maximum number of Investment Plans, duration, exposure limits, investment restrictions and performance benchmarks, alongside prescribed disclosures (including additional risk information for Fund of Fund schemes), a requirement to issue a separate Investment Plan report within the Fund Manager Report, offering process rules such as subscription timelines and net asset value announcements, and provisions governing Total Expense Ratio, formation costs and other charges.
Securites & Exchange Commission of Pakistan 2025-01-06
Securities and Exchange Commission of Pakistan introduces detailed rules for mutual fund Investment Plans
The Securities and Exchange Commission of Pakistan has enhanced its regulatory framework for mutual funds by detailing "Investment Plans" requirements under the Non-Banking Finance Companies and Notified Entities Regulations, 2008. It specifies permissible Collective Investment Scheme categories, operational parameters, exposure limits, investment restrictions, and performance benchmarks. It mandates disclosures, offering process rules, and provisions on Total Expense Ratio and other charges to bolster governance and investor protection.