WEST PALM BEACH, FL (www.hedgeco.net) – Japanese authorities have announced its plans to further scrutinize the fast growing hedge fund industry in 2006; such scrutiny will likely force the industryregulators to institute new laws for the growing hedge fund industry. News reports from Japan shows that the Japanese hedge fund regulators, Financial Services Agency {FSA} are planning to holdpublic hearings on the issue. In a statement released last week, Japanese authorities said, �In cooperation with the Bank of Japan and the Finance Ministry, we will hold hearings with relevantparties to determine conditions (in the hedge fund industry) and sort out the key issues.”
Such move may have been copied from the United States whose hedge fund regulator, SEC passed a law in 2004 to begin regulating its hedge fund industry. The new laws aroused much criticism within the U.S. Hedge fund industry. Many of the US Hedge Fund Industry participants believe the new laws were unnecessary because the industry has done a pretty good job of self-regulation.
The European Union seems to be heading in that direction as well in favor of hedge fund regulation. Some hedge fund market observers believe that the Eurozone financial market policy makers will eventually implement its hedge fund regulation initiatives. There are signs pointing to that direction with new calls by notable European financial market officials for a united European policy on hedge funds. Recently, Charlie McCreevy the EU Financial Services Commissioner told Bloomberg correspondent that, �The European Union should regulate hedge funds in order to protect inexperienced European investors.� The US regulators also used similar language when it began regulatory proceedings for the US Hedge Fund industry.
The Japanese hedge fund industry has seen significant growth in its hedge fund sector lately. Such trend is also being seen in other Asian hedge fund markets such as Hong Kong and Singapore, as well as in the Asia Pacific region. No further details have been provided about the Japanese regulators� hedge fund regulatory plans.
Paul Oranika
Editor-in-Chief
HedgeCo.Net
Email: Editor@hedgeco.net
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