Bursa Malaysia enhances the regulatory framework for listed collective investment scheme


Bursa Malaysia Securities Berhad

Bursa Malaysia Securities Berhad (Bursa Malaysia or the Exchange) has announced that it has made enhancements to the regulatory framework for listed collective investment scheme (CIS) and business trust under the Main Market Listing Requirements (Main LR). The CIS includes the Real Estate Investment Trusts (REITs), Exchange Traded Funds (ETFs) and Closed-End Funds (CEFs).

The enhancements arise from a review of the existing CIS framework by the Securities Commission Malaysia (SC) and the Exchange, aimed at promoting growth and greater business efficiency of CIS and business trust listed on the Main Market.

Following the review, the Capital Markets and Services Act 2007 (CMSA) has been amended, in which the function to approve new issue of securities by listed CIS and business trust (other than debt securities or pursuant to a significant change in the business direction or policy of a business trust), is now transferred to Bursa Malaysia as the approving authority. This will in turn improve the time-to-market and reduce regulatory costs which will enhance the overall market attractiveness and competitiveness of CIS and business trust in the Malaysian capital market.

The key enhancements are as follows:

  • Improve efficiency and time-to-market of secondary fund raising through issue of securities by listed CIS and business trust;
  • Strengthen unit holder protection and facilitate greater operational efficiency by enhancing the transaction framework governing listed REITs under the Main LR;
  • Introduce other REIT enhancements to promote growth which are in line with the liberalisations relating to permitted investments under the SC’s Guidelines on Listed REITs;
  • Strengthen REIT’s corporate governance to instil greater investor confidence; and
  • Enhance the periodic reporting framework for CIS and business trust to improve quality of disclosures.

Most of the amendments to the Main LR will take effect from 9 April 2018 onwards. Enhancements relating to corporate governance and additional disclosures in the quarterly reports and annual reports will have a longer grace period for compliance.

These amendments are in line with Bursa Malaysia’s continuous efforts of positioning itself as a conducive listing and capital raising destination.

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Bursa Malaysia enhances the regulatory framework for listed collective investment scheme

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