For immediate release: Thursday 7 December 2006

IMA WELCOMES FSA MOVE TO INTRODUCE HEDGED SHARE CLASSES FOR COLLECTIVE INVESTMENT SCHEMES

The Investment Management Association (IMA) has today responded to the FSA consultation "CP06/18 - Quarterly Consultation No. 10" which proposes to introduce hedged share classes for Collective Investment Schemes.

The Association first raised the issue of introducing a hedged share class for funds in June this year as a result of concerns raised by IMA membersą. The current inability to offer such share classes puts the UK funds market at a competitive disadvantage as hedging techniques are already permitted in other jurisdictions including Dublin and Luxembourg. The lack of provision for such classes in the UK could result in managers opting to launch their funds offshore or force them to launch alternative products at considerable expense.

Richard Saunders, Chief Executive of the IMA, commented:

"We welcome the FSA's consultation on extending the COLL rules to allow managers to introduce hedged share classes for authorised funds. The move will offer a truly hedged share class as an alternative to investing in the base currency and will bring UK UCITS into line with their European counterparts. This consultation demonstrates the FSA's willingness to listen to industry concerns about product development in the UK and has taken on board the needs of investment managers."

A copy of IMA's response to "CP06/18 - Quarterly Consultation No. 10" is attached.

-Ends-

Notes to editors:
1. A hedged share class refers to a currency share class which enables managers of unit trusts and OEICs to conduct hedging transactions, the benefit and cost of which will accrue solely to investors in that class.

For further information, please contact:
Helen Stephenson, Communications Officer, IMA, 020 7831 0898

Out of hours, please contact:
Mona Patel, Head of Communications, IMA, 07834 089332