The Securities and Exchange Commission of Pakistan (SECP) has allowed Asset Management Companies (AMCs) to invest on behalf of equity-oriented Collective Investment Schemes (CIS) in units of unlisted or privately placed real estate investment (REIT) Scheme.
SECP has issued circular No.I9 of 2021 on Friday on the issue of the investment in Units of Unlisted or Privately Placed REIT Scheme by Equity Oriented Collective Investment Schemes.
The commission, in the exercise of powers conferred under section 282 B (3) of the Companies Ordinance 1984 read with Regulation 55(15) of the Non—Banking Finance Companies and Notified Entities Regulations 2008 (the “Regulations”) hereby allows Asset Management Companies (AMCs) to invest, on behalf of equity-oriented Collective Investment Schemes (CIS) namely equity, asset allocation, balanced and index schemes, in units of unlisted or privately placed REIT Scheme, which shall be listed on a securities exchange within a period of three years from its financial close as provided in Regulation 5(3) of the REIT Regulations, 2015.
This is subject to the condition that the CIS shall take exposure in units of unlisted or privately placed REIT Schemes up to a maximum of 5 percent of net assets of CIS or net assets of such REIT Schemes whichever is lower, provided that the entity/sector/group exposure limits as specified in the Regulation are complied with.
An AMC before investing shall ensure that investment in units of unlisted or privately placed REIT schemes are correctly valued and priced for the purpose of calculation of NAV and the mechanism is available for the exit of the CIS from such REIT scheme.
This circular is in continuation to Circular No. 19 of 2015 dated May 15, 2015, SECP added.