German fund paper not meant for publication - Ministry

The German government concept paper for reforms in the Investor Law, also affecting real estate funds, was meant for discussion and not for publication, responsible federal Finance Ministry official Uwe Wewel says. He told a conference organised by the Handelsblatt newspaper that the clause proposing an across-the-board 10% discount on current property fund valuations is aimed at establishing equal treatment for all investors, with expected introduction in any case not before April 2011. "This is not about some kind of discount but establishing fair value both for investors already in the fund and those who might want to invest in the future," Wewel said. Daily valuations are also problematic. "We need to make some changes," he said. "Things went very well for the open-end funds for the first 40 or 50 years but it did not go well in the last five years." The ministry has invited interested parties to discuss the proposal, met with outrage by the funds sector and with the closures this week of, so far, two more open-end funds, in Berlin on 26 May. (See upcoming PIE Editions for full story)