0001193125-21-261789.txt : 20210831 0001193125-21-261789.hdr.sgml : 20210831 20210831134652 ACCESSION NUMBER: 0001193125-21-261789 CONFORMED SUBMISSION TYPE: 497 PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20210831 DATE AS OF CHANGE: 20210831 EFFECTIVENESS DATE: 20210831 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MATTHEWS INTERNATIONAL FUNDS CENTRAL INDEX KEY: 0000923184 IRS NUMBER: 000000000 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 497 SEC ACT: 1933 Act SEC FILE NUMBER: 033-78960 FILM NUMBER: 211226423 BUSINESS ADDRESS: STREET 1: FOUR EMBARCADERO CENTER STREET 2: SUITE 550 CITY: SAN FRANCISCO STATE: CA ZIP: 94111 BUSINESS PHONE: 8007898742 MAIL ADDRESS: STREET 1: FOUR EMBARCADERO CENTER STREET 2: SUITE 550 CITY: SAN FRANCISCO STATE: CA ZIP: 94111 0000923184 S000034706 Matthews Asia Total Return Bond Fund C000106892 Institutional Class Shares MINCX C000106893 Investor Class Shares MAINX 0000923184 S000053714 MATTHEWS ASIA CREDIT OPPORTUNITIES FUND C000168876 Investor Class Shares MCRDX C000168877 Institutional Class Shares MICPX 497 1 d210062d497.htm FORM 497 Form 497

SUPPLEMENT DATED AUGUST 31, 2021

TO THE PROSPECTUS FOR

THE MATTHEWS ASIA TOTAL RETURN BOND FUND AND

THE MATTHEWS ASIA CREDIT OPPORTUNITIES FUND (THE “FUNDS”)

DATED APRIL 30, 2021 (AS SUPPLEMENTED)

For all existing and prospective shareholders of the Funds:

Effective immediately, the following disclosure is added directly following “Risks of Investing in the Funds – Risks Associated with China, Hong Kong, and Macau – China” on page 29 of the prospectus:

Variable Interest Entities. The Funds may invest in certain operating companies in China through legal structures known as variable interest entities (“VIEs”). In China, ownership of companies in certain sectors by foreign individuals and entities (including U.S. persons and entities such as the Funds) is prohibited. In order to facilitate foreign investment in these businesses, many Chinese companies have created VIEs. In such an arrangement, a China-based operating company typically establishes an offshore shell company in another jurisdiction, such as the Cayman Islands. That shell company enters into service and other contracts with the China-based operating company, then issues shares on a foreign exchange, such as the New York Stock Exchange. Foreign investors hold stock in the shell company rather than directly in the China-based operating company. This arrangement allows U.S. investors to obtain economic exposure to the China-based company through contractual means rather than through formal equity ownership.

VIEs are a longstanding industry practice and well known to officials and regulators in China; however, VIEs are not formally recognized under Chinese law. Recently, the government of China provided new guidance to and placed restrictions on China-based companies raising capital offshore, including through VIE structures. Investors face uncertainty about future actions by the government of China that could significantly affect an operating company’s financial performance and the enforceability of the shell company’s contractual arrangements. It is uncertain whether Chinese officials or regulators will withdraw their implicit acceptance of the VIE structure, or whether any new laws, rules or regulations relating to VIE structures will be adopted or, if adopted, what impact they would have on the interests of foreign shareholders. Under extreme circumstances, China might prohibit the existence of VIEs, or sever their ability to transmit economic and governance rights to foreign individuals and entities; if so, the market value of the Funds’ associated portfolio holdings would likely suffer significant, detrimental, and possibly permanent effects, which could result in substantial investment losses.

Please retain this Supplement with your records.

ST062