ANGARA: COLLECTIVE INVESTMENT SCHEMES BILL
ESSENTIAL FOR THE ECONOMY

Senator Edgardo J. Angara today takes action to unify different laws and regulations on unit investments trust funds and investment companies through the Collective Investment Schemes (CIS) bill. SB 1181 aims to assist in the growth of industries in the country as the Philippines is left in terms of regulating investment funds.

"United Kingdom, Japan, Australia, Korea and Singapore have already adopted this kind of approach. Today, the worldwide trend in the regulation of collective investment schemes (CIS) is to have single law to regulate all types of CIS. This will establish a comprehensive regulatory framework for all forms of CIS and to catch up with the worldwide trend in CIS regulation," Angara said who chairs the Senate Committee on Finance.

In the Philippines, investment companies (mutual funds) and unit investment trust funds (UITFs), the most common forms of CIS, are still governed by varying laws and regulations. As such, this bill seeks to balance the interests of investors through mechanisms that would safeguard the public interest, at the same time recognizing the interests of the other parties involved in the CIS industry, by giving them flexibility to expand their CIS businesses.

Angara explained that if the existing regulatory arbitrage in the country gives rise to an uneven playing field which will prove unfavorable to the growth of the industry. Furthermore, it will even result in uneven levels of protection to the investing public.

"Through this bill, it is expected that even the middle to low income individuals will explore more investment opportunities in CIS, thereby gaining access to the capital markets which in turn helps the country's economy through expanded capital base," Angara said.

Moreover, this bill seeks will promote investor protection by applying high governance standards in the establishment, sale, management and operation of collective investment schemes in order to prevent abuse and protect the interests of the investing public. Also, it will promote the growth of pooled investments and the development of the capital market with the use of a favorable framework of collective investment schemes that will facilitate the flow of investment capital from sources within the country and abroad.