Korea is moving to quicken a regulatory revision in a bid to launch the first local hedge fund within the year, an official at the financial regulator said.

The Financial Services Commission had planned to submit a revision bill to the capital market law to parliament in July or August as part of its efforts to spur the creation of local hedge funds.

Instead of rewriting the law, the FSC will seek to amend the law’s enforcement decree, which may take two to three months, to save time and head off potential disagreements during the law revision process, the official said.

“The target (of the shortened process) is to help create the first local hedge fund within this year,” the official said.

A hedge fund is privately pooled money used by investors who seek massive investment returns through risky bets using a wide range of investment techniques, including short selling and leveraged buyouts.

The regulatory change is expected to allow a hedge fund to borrow up to 400 percent of its assets and to place bets on financial derivatives products.

FSC chairman Kim Seok-dong expressed his determination to make the first hedge fund be launched within this year when he met a group of reporters on Monday. “We will do every effort to advance the introduction of the local hedge fund by revising the implementation decree before the revision work for the capital market law,” Kim said.

“We should not delay further the introduction of the hedge fund by taking an emergency measure,” he was further quoted as saying.

(From news reports)