There are nine recognized collective management companies in the Principality, running 65 funds with €5.2 billion under management. A significant “plus” for Monaco’s financial market.
The latest regulations incorporate noteworthy changes affecting financial activities in Monaco. All credit companies and financial establishment are obliged to belong to AMAF, Monaco’s banking association, the prime point of contact with the authorities. The jurisdiction of the independent supervisory authority, the Commission for the Control of Financial Activities (CCAF), has been extended to cover both private and collective management. Finally, regulations have been adopted for collective management, in two parts: for mutual funds (MF) and investment funds (IF).
Numerous advantages
Monaco’s laws, oriented towards client protection, govern the operations of MFs, which are generally open to the public. The aim, inspired by European practice, is to ensure that investment operations are regulated by a joint international approach to management and risk limitation. For IFs, designed for clients who are professionals and/or people familiar with market mechanisms, financial management without the traditional constraints of investment limits is authorized, in an appropriate legal framework. For almost twenty-five years now, the firms concerned have been operating in a market fully exposed to international competition. This openness, allied to the reactive attitud of the authorities, has allowed local specialists to keep abreast of change that involves unceasing innovation. The cosmopolitan membership of the CCAF testifies to its international outlook, based on the work of the Secretary General’s office, always accessible and attentive to the needs of managers and investors. Applications are processed rapidly to suit the requirements of an increasingly reactive profession: a week is all it takes to obtain approval for a “reserved” fund.
What about the future?
On-going developments in international financial relationships involve Monaco in a process of harmonization: free circulation of financial products developed under Monegasque law will become reality. The regulatory texts are adequate and the profession is ready. Subscribers to an alternative management IF registered in the Principality benefit from the guarantee of a depositary bank governed by the risk surveillance system of the Banque de France. In Monaco, “reserved” MFs or IFs are appropriate made-to-measure investment tools for quality or professional investors: the €2.3 billion under management bear witness to this. Their flexibility of constitution and use go hand-in-hand with full compliance with the protective regulatory framework that guarantees control of operations carried out. Finally, investors in the 39 “open” MFs and IFs, with €2.9 billion under management, benefit from immediate, direct communication with fund managers on the spot.
