OPEN‐ENDED INVESTMENT COMPANIES
| Published date | 01 April 1995 |
| Pages | 321-328 |
| Date | 01 April 1995 |
| DOI | https://doi.org/10.1108/eb024854 |
| Author | SUSAN HODGE |
| Subject Matter | Accounting & finance |
OPEN-ENDED INVESTMENT COMPANIES
Received: 22nd August,
1995
SUSAN HODGE
SUSAN HODGE
IS
AN
ASSISTANT SOLICITOR
AT
TITMUSS SAINER DECHERT
IN
LONDON
WHERE
SHE
DEALS WITH
ALL
ASPECTS
OF
CORPORATE LAW
AS IT
RELATES
TO
PRIVATE COMPANIES
AND
ADVISES
ON
REGULATORY ISSUES AFFECTING
BUSINESSES WHICH
ARE
SUBJECT
TO
THE PROVISIONS
OF THE
FINANCIAL
SERVICES
ACT.
PREVIOUSLY,
SHE
WORKED
AS A
POLICE OFFICER WITH
WEST YORKSHIRE METROPOLITAN
POLICE ATTACHED
TO THE
VICE
SQUAD, QUALIFYING
FOR THE
RANK
OF
INSPECTOR
IN 1980.
ABSTRACT
The
UK
Government
has
recognised
for
some time that
the
UK fund management
industry would welcome
the
availability
of
a
new
form
of
investment vehicle, namely
an open-ended investment company.
HM
Treasury
has
recently issued draft regula-
tions relating
to the
establishment
and
operation of such companies.
This paper compares some other cur-
rently available investment vehicles
and
reviews
the
proposed legal framework
for
open-ended investment companies.
INTRODUCTION
The open-ended investment com-
pany (OEIC) will
be a
company with
variable capital,
in
which shares
may
be redeemed
by the
investor
on
demand
at a
price calculated
by ref-
erence
to
underlying
net
asset value.
Investment vehicles organised
on
this
basis already exist
in
North America
and elsewhere
in
Europe.
By
means
of
the
provision
of a
similar vehicle
in
the
UK,
which
is
perceived
to be
familiar
and
flexible,
the
industry
believes that investment from over-
seas investors will
be
encouraged.
Until
now,
publicly available
pooled investment vehicles
in the UK
have been confined
to
authorised
unit trusts
and
listed investment
trusts/venture capital trusts.
The
existing form
of UK
authorised unit
trust
is
considered
by
many
to be an
obstacle
to
attracting overseas invest-
ors,
who
feel uncomfortable about
the lack
of a
corporate identity
and
about
the
dual
'bid' and
'offer' pric-
ing structure which characterises such
321
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