The first China fund for foreigners, Martin Currie Inc.’s China "A" Share Fund, will not launch as planned on July 23, Reuters reports. U.S. regulators took issue with an interview that the fund manager gave to Barron’s during the quiet period, a source told Reuters. Regulators perceived the interview as a solicitation for funds in an unregistered vehicle, the source said.

The fund, which will be listed on the Dublin stock exchange and which is now set to debut in late August, will invest in China’s yuan-denominated securities markets. China’s stock and bond markets have heretofore been closed to foreign investors, but through China’s Qualified Foreign Institutional Investor scheme, UBS obtained a $300 million investment quota for 2003. Whatever UBS does not invest in China’s markets by Sept. 4, it must hand over to other firms. UBS has raised $100 million to date, according to another source.

Martin Currie is hoping to raise $50 million to $70 million in institutional investments for its China fund. Officials at Martin Currie declined to comment on the delay, but a UBS spokesman told Reuters, "We remain committed to seeing [the fund] successfully launched."

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The staff of Money Management Executive ("MME") has prepared these capsule summaries based on reports published by the news sources to which they are attributed. Those news sources are not associated with MME, and have not prepared, sponsored, endorsed, or approved these summaries.

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