The investment funds sector is one of the most appealing branches of the financial industry in Singapore. The legislation which provide for clear regulations when it comes to the creation of investment funds and other types of businesses, such as cryptocurrency exchanges which are very popular at the moment, make Singapore a very attractive financial center.
Returning to the regulations which must be respected when investing in the financial sector, a few of them refer to the licenses which need to be obtained and in the case of investment funds, fund managers must be appointed to complete certain activities.
In order to manage an investment, a fund manager license is required in Singapore. There are two types of licenses Singapore fund manager can obtain.
Below, our company formation specialists explain how to obtain a fund manager license in Singapore. We can also help you open a company in Singapore with the purpose of obtaining a fund manager license.
The fund management company in Singapore
The easiest way of obtaining a fund manager license is by company registration in Singapore. There are two types of companies one can open and obtain fund manager licenses for: the registered fund management company (RFMC) and the capital markets services licensed company (CMSLC).
You can rely on our local advisors if you want to open a company in Singapore and apply for one of the two licenses for fund management companies.
Obtaining a license for a fund management company in Singapore
In order to apply for a fund manager license in the case of a fund management company in Singapore, a local or a foreign investor must register a company with ACRA under the following conditions:
- the company must have at least 2 directors with at least 5 years of experience in the financial industry;
- at least one of the directors must be a Singapore citizen or resident and must be appointed as an executive director;
- the minimum share capital for obtaining the fund manager license is 250,000 SGD;
- the documents required for registration are the same as for any other type of company in Singapore;
- the fund management company must have a permanent head office in Singapore;
- different criteria can apply, based on the number of investors the Singapore company will service.
The requirements mentioned above apply to fund management companies servicing a maximum number of 30 investors and managing assets with a value of maximum 250 million SGD.
Special requirements apply when seeking to obtain a fund manager license with the purpose of administering assets with a value of more than 250 million SGD. The Singapore company formation requirements in this case are a minimum of 3 directors, out of which 2 must reside or relocate to Singapore, and a share capital which can go up to 1 million SGD.
Our company formation consultants in Singapore can offer more information on the requirements related to obtaining a fund manager license and can assist clients interested in setting up a company in Singapore.
We are at your disposal if you want to incorporate a subsidiary in Singapore.
Conditions for fund managers in Singapore
Those who want to open a company in Singapore and apply for a fund manager license must also register with the Monetary Authority in the city-state (MAS) and must comply with a few requirements, among which:
- – the Competency of Key Individuals which implies appointing persons who have the necessary knowledge and experience in the industry;
- – the Fit and Proper test which implies for the shareholders, the managers and employees to have clean criminal records;
- – the base capital risk requirements – companies servicing clients with assets of more than 250 million SGD must have a capital risk base of 120%;
- – the company must create compliance agreements which are set out in accordance with the MAS’ regulations;
- – fund management companies must also set in place a risk management framework.
Other requirements which fund managers are subject to are regular internal audit regulations, an annual audit conducted by an independent professional and a professional indemnity insurance.
Our Singapore company formation professionals can offer more information on the fit and proper criteria to be met when applying for a fund manager license. They are also at the service of those who want to expand their operations by setting up a subsidiary in Singapore.
The capital markets services license in Singapore
A Singapore fund manager can also apply for a capital markets services license provided that it has a proven track record, it meets the fit and proper criteria and respect the requirements imposed by the Securities and Futures Act.
If you want to open a Singapore company with the purpose of setting up a fund management company and need assistance, please contact us. We can also help those interested in setting up a company in Singapore or an investment fund.