The Labuan Financial Services Authority recently issued guidelines on investment management for insurance and takaful business, fit and proper person requirements and the establishment of Labuan fund managers.
The new guidelines are aimed at promoting better governance and prudent practices of investment activities undertaken by Labuan reinsurers and retakaful operators.
They are intended to ensure that the investment management framework and practices of Labuan insurers operating in both the conventional and Islamic space remain sound and effective.
The new guidelines were issued on 11 February 2014 and will come into effect on 1 January 2015.
The revised guidelines seek to provide further clarity on the expectations of Labuan FSA on the suitability of relevant persons of a Labuan Financial Institution.
Among others, the revision entails a modified scope of relevant persons and an internal fitness and propriety policy to be developed by an LFI to reflect its application of the revised guidelines’ requirements.
The guidelines on the establishment of Labuan fund managers replace the guidelines on the establishment of fund management companies. They expand on the older guidelines, covering in greater detail the application procedures, operational and regulatory requirements for Labuan fund managers in the Labuan International Business and Financial Centre.
Other than outlining the permitted activities of a Labuan fund manager, the guidelines also introduce a section called “Market Conduct and Practices”, which further elaborates on the requirements previously listed under the “Business Ethics” section.
