Amendments to the Communiqué on Principles Regarding Mutual Funds

07.03.2024 Doğukan Kalınoğlu
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The Communiqué Amending the Communiqué on Principles Regarding Mutual Funds (III-52.1) (III-52.1.E) (Communiqué) entered into force upon publication in the Official Gazette dated 01.03.2024 and numbered 32476. The Communiqué published by the Capital Markets Board focuses on the amendments regarding the disclosure of issues related to hedge funds on the KAP page.

The amendments made under the Communiqué are summarized below:

  • It was regulated that the investment strategies and limits constituting the investment limits of hedge funds would be published on the KAP page instead of information documents.
  • Information on the countries of foreign funds whose shares may be included in the portfolio of hedge funds will be included in the investment strategy announced on the KAP page instead of the prospectus and investor information form.
  • The principle is that the limits regarding the risks exposed due to futures and options contracts and swap contracts in the portfolios of hedge funds will be included in the KAP page instead of the prospectus and investor information forms, and the necessary measures to be taken in case the limits are exceeded will be announced on the KAP page has been adopted.
  • For hedge funds, announcements regarding changes in the prospectus that may affect investors' investment decisions and require prior information should be announced on the KAP page.
  • It was regulated that the principles of trading units of hedge funds should be announced on the KAP page instead of the prospectus and investor information forms.
  • The elements required to be included in the prospectus of hedge funds were changed. The principle of including only items (a), (b), and (ğ) of Annex-2 of the Communiqué was adopted. As for the other elements, the principles for determining the benchmark or threshold value and the fund management fee rate will be announced on the KAP page of the fund. It is also regulated that the founder is responsible for this information.
  • The benchmark or threshold value from the information announced on the KAP page regarding the fund's investment strategy, benchmark or threshold value, investment objective, investment limitations, risks, trading of fund units, conditions for joining and leaving the fund, fund management fee rate and increasing risk limits, to make amendments on fund conversions, the announcement regarding the amendments to be made must be announced on the KAP page of the fund at least 30 days before the effective date of the amendment, and the principle that other issues can only be amended to be effective from the beginning of the following accounting period has been adopted.
  • With the provisional article added to the Communiqué, it is optional for hedge funds whose prospectuses have been approved as of 01.03.2024 to comply with the prospectus standards introduced after the amendment. Prospectus amendments to be made by hedge funds wishing to comply with the said amendments can only be made by informing the Capital Markets Board, and the approval of the Capital Markets Board is not required.

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