[9446]
IMMEDIATE
ACTION
REQUESTED
December 1, 1997
TO: INTERNATIONAL COMMITTEE No. 42-97
RE: MALAYSIA ESTABLISHES GUIDELINES TO PERMIT FOREIGN FUND
MANAGEMENT COMPANIES
______________________________________________________________________________
Attached is a copy of the guidelines under which Malaysia currently will permit
foreign-owned asset management companies to provide investment management services in
Malaysia. These guidelines establish two options for foreign asset management firms to
establish a commercial presence in Malaysia, depending upon whether the foreign firm will
provide services solely to clients outside of Malaysia or also will seek to provide asset
management services to Malaysians. Under the guidelines, a foreign firm may establish a 100%
owned affiliate in Malaysia if the affiliate provides asset management services solely with
respect to assets sourced from outside Malaysia. To provide services also to Malaysian clients,
a foreign firm is limited to holding no more than a 70% ownership share in the affiliate and the
affiliate, among other things, must have at least $100 million in assets under management
sourced from outside Malaysia.
Because Malaysia may be willing to incorporate these market opening changes in its
offer in the WTO Financial Services Negotiations to be completed by December 12, 1997, the US
Treasury Department has asked our advice on whether the guidelines would appear to have
commercial significance for US firms. Please provide any comments you have by December 4,
1997.
You can reach me by phone at (202) 326-5826, by fax at (202) 326-5839, or by e-mail at
podesta@ici.org.
Mary S. Podesta
Associate Counsel - International
Attachment (in .pdf format)