NETHERLANDS - The Dutch government has offered local asset managers the option of a voluntary supervisory regime. The aim is to increase their attractiveness to foreign institutional investors.

The option of voluntary supervision is part of a bill - the ‘Wijzigingswet Financiële Markten 2010' - which has been submitted to parliament by finance minister Wouter Bos.

"Whereas Dutch investment funds for professional investors have been exempted from supervision, quite a few supervisors abroad won't allow their institutional players to invest in non-supervised funds," said Mischa Muntinga, chairman of the asset pooling working group of Holland Financial Centre (HFC).

"In a bid to solve this dilemma, together with the finance ministry, we have developed this additional instrument for the toolbox of asset managers which offer services to foreign investors," he added.

Muntinga wasn't able to indicate the scale of the interest from the market. "But given the trend to decrease risks, we are convinced there is a growing demand for supervised funds," he argued.

That said, Kees Groffen of law firm De Brauw Blackstone, indicated that his company is already preparing the legal constructions for ‘a number' of Dutch asset managers, after "large institutional investors have shown interest in investing billions of euros".

According to Groffen, the supervised investment option will be similar to the Specialised Investment Fund of Luxembourg and the Qualified Investor Fund of Ireland.

A finance ministry spokeswoman made clear that the new legislation will also allow Dutch pension funds to invest in funds that have adopted a voluntary supervisory regime.

"It is a reassuring sign to external players if investment funds opt for a licence. Therefore, we will definitive look at the new option," responded Michel Meijs, spokesman for APG, the asset manager of the €170bn civil service scheme ABP.
 
The legal framework for a system of voluntary supervision for asset managers is scheduled to take effect as of 1 January 2010.

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