SINGAPORE (Jan 15): The Monetary Authority of Singapore (MAS) and the Accounting and Corporate Regulatory Authority (ACRA) on Wednesday launched the Variable Capital Companies (VCC) framework.
The VCC is a new corporate structure that can be used for a wide range of investment funds and provides fund managers greater operational flexibility and cost savings.
In a joint media release, MAS and ACRA say this will encourage more funds to be domiciled in Singapore and enhance the country's value as an international fund management centre.
Fund managers will be able to constitute investment funds as VCCs across both traditional and alternative strategies, and as open-ended or closed-end funds.
Fund managers may also incorporate new VCCs or re-domicile their existing investment funds with comparable structures by transferring their registration to Singapore as VCCs.
The launch saw a total of 20 investment funds incorporated or re-domiciled as VCCs. This includes the 18 fund managers that participated in a VCC Pilot Programme that was initiated by MAS and ACRA in September last year.
To further encourage industry adoption of the VCC framework in Singapore, MAS has also launched a Variable Capital Companies Grant Scheme. The grant scheme will help defray costs involved in incorporating or registering a VCC by co-funding up to 70% of eligible expenses paid to Singapore-based service providers.
The grant is capped at $150,000 for each application, with a maximum of three VCCs per fund manager.
The grant scheme will be funded by the Financial Sector Development Fund (FSDF) and take effect today for a period of up to three years.
The FSDF was established in 1999 under the Monetary Authority of Singapore Act to promote Singapore as a financial centre, and to develop and upgrade the skills and expertise as well as infrastructure to support the financial services sector in Singapore.
“The VCC marks a significant chapter in the development of Singapore as a full-service international fund management and domiciliation hub,” says Benny Chey, Assistant Managing Director (Development and International), MAS.
“The VCC framework provides fund managers with a greater choice of investment fund vehicles in Singapore that caters to the needs of global investment funds and investors,” he adds. “Fund managers will also be able to extract cost savings from centralising their fund management and domiciliation activities in Singapore and structuring their funds more efficiently.”
