28 November 2006

IOSCO survey report on Hedge Funds

IOSCO released its final survey report on the regulatory environment for Hedge Funds. IOSCO concludes that none of the responding members has adopted a formal, legal definition of the term “hedge fund.” The way that member jurisdictions are regulating hedge funds differ and many jurisdictions are still developing their regulations.

Most jurisdictions prefer to regulate, or soon will do so, hedge fund advisers rather than the fund itself. Few jurisdictions report any significant “retailization” of hedge funds at this point in time, but some regulators anticipate that this is changing or may change in the future.

Finally, there have been some incidents of fraud relating to hedge funds in the responding jurisdictions, with the extent of fraud low in some jurisdictions but varying in member jurisdictions. In addition, some members noted that their regulatory regime for hedge funds was new and that as a result, there was no data on hedge fund fraud.

Full report

© IOSCO