What is a VCC?
Singapore introduced an alternative fund framework, Variable Capital Company (VCC), to encourage more funds to be domiciled in Singapore and enhance the jurisdiction’s value as an international fund management centre. VCC came into operation in Singapore on 14 January 2020 which allows set up of collective investment schemes, whether open-end or closed-end.
VCC provides an alternative to Singapore’s existing structures, namely, unit trusts, limited partnerships, limited liability partnerships and companies. VCC is regulated under the Variable Capital Company Act 2018 and The Accounting and Corporate Regulatory Authority (ACRA) is the administrating authority for the VCC Act except in relation to anti-money laundering/countering the financing of terrorism (AML/CFT) which is supervised by the Monetary Authority of Singapore (MAS).
Categories of Licensing Registration for Fund Managers in Singapore
Clients must be categorized under one of three categories of Licensing registration in Singapore (unless you are an exempted entity such as a licensed bank). The three categories are:
1. Registered Fund Manager
Although not really a license, it is effectively a regulatory status given to you by the MAS. There are certain limitations underneath the registered fund management regime, however. For example, you can only have up to 30 qualified investors out of which 15 can be made up of fund structures such as a VCC.
2. Capital Market Services License Fund Management (Accredited & Institutional Investors)
This license deals only with accredited and institutional investors. So under this license category, there’s no limitation in terms of how many or what assets you can manage. There’s an unlimited amount of assets that you can manage, but there is a limitation in terms of the type of clients that you can have.
3. Capital Market Services License Fund Management (All Types of Investors)
This category is like the second, except it deals with every type of investor making it more of a retail investment category.
Setting Up a VCC With Argus?
We are an experienced regulatory consulting firm who can assist financial institutions with their compliance requirements in Singapore. We help fund managers in Singapore understand the basic requirements of VCC and incorporate a standalone or umbrella VCC in Singapore. We can also assist fund managers to transfer their existing funds to the VCC structure in Singapore.
Client-Focused Compliance Specialists
Contact Argus today to learn how we can help you with setting up a VCC in Singapore today.
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