SEBON Opens Draft Collective Investment Fund Policy 2083 for Public Consultation
Nepal's securities regulator has released a draft collective investment fund policy aimed at modernizing the mutual fund industry, expanding instruments like ETFs and REITs, and strengthening investor protection. Stakeholders have until Kartik 15, 2083 to submit feedback.
The Securities Board of Nepal (SEBON) has published the draft Collective Investment Fund Policy, 2083 for public consultation, inviting feedback from investors and stakeholders to strengthen and modernize Nepal's mutual fund industry.
The draft was prepared in line with the Capital Market Strengthening and Revival Action Plan, 2083, issued by the Ministry of Finance on Bhadra 29, 2083. That action plan calls for developing instruments such as the bond market, money market and exchange-traded funds (ETFs), while positioning mutual funds as professional, diversified, transparent, risk-conscious, technology-friendly and long-term investment vehicles.
According to SEBON, the proposed policy aims to provide an integrated framework for the establishment, operation, regulation and supervision of collective investment funds. It seeks to make the industry more modern, transparent, secure and competitive, while strengthening long-term capital mobilization, investor protection and the development of institutional investors.
Key priorities of the draft include:
- Open-ended mutual fund schemes, which receive top priority
- New investment instruments such as ETFs, Real Estate Investment Trusts (REITs), infrastructure funds and green funds
- Portfolio diversification and transparent asset valuation methods
- Effective liquidity and redemption management
- Timely disclosure of information to investors
The proposed policy places greater emphasis on investor protection through enhanced transparency, grievance-handling mechanisms, conflict-of-interest controls, competitive fee structures, risk management and institutional governance. Digital services and cybersecurity have also been incorporated as important components of the proposed regulatory framework.
SEBON has further recognized the specialized role of fund managers in the effective operation of collective investment schemes. The policy therefore seeks to strengthen fund managers' professional capabilities, human resources, information technology infrastructure and overall management capacity. It also proposes linking management fees more closely with the performance of fund managers.
SEBON expects the phased implementation of the policy to help mobilize the long-term savings of small investors into the capital market, expand investment opportunities and contribute to greater market stability.
The board has invited investors and stakeholders to review the draft Collective Investment Fund Policy, 2083 and submit their suggestions and recommendations. Stakeholders have been requested to provide feedback by Kartik 15, 2083.