If you want to open a hedge fund in Singapore, you can rely on our local specialists. We will guide you through the registration and licensing procedures for a fully functional setup.
| Quick Facts | |
|---|---|
| Applicable legislation | Code on Collective Investment Schemes. |
Types of hedge funds | – Domestic (onshore), – foreign-owned (offshore). |
Types of investors addressed | Qualified/professional investors. |
| Legal forms available for registration | – Private limited liability companies, – limited partnerships, – variable capital companies. |
| Registration steps | – Documents gathering, – legal entity registration, – licensing (only under certain conditions). |
| Share capital requirements (if any) | – SGD 100,000 for single funds, – SGD 20,000 for hedge fund of funds (HFOF). |
| Authorization requirements (if any) | Yes, for funds with more than 30 investors. |
| Licensing authority | The Singapore Monetary Authority. |
| Local manager required (YES/NO) | Yes, a local manager is required. |
| Registration timeframe (approx.) | Approx. 6 months. |
| Types of assets to invest in | – Debt and equity securities, – commodities, – currency (crypto included), – derivatives, – real estate. |
| Possibility to operate abroad (YES/NO) | Yes, offshore hedge funds can operate outside Singapore. |
| Taxation | Singapore hedge funds are subject to taxes which can be offset through numerous incentives. |
| Advantages of setting up a hedge fund in Singapore | – Access to tax incentives, – licensing exemptions for certain types of funds, – possibility to operate in and outside Singapore. |
| Support in creating a Singapore hedge fund (YES/NO) | Yes, we can assist with the establishment of a hedge fund in Singapore. |
Table of Contents
What does it entail to create a hedge fund in Singapore?
If you decide to open this type of investment fund in Singapore, you need to consider that it is a 2-step process, namely:
- register the fund vehicle;
- register or hire an investment fund management company.
What are the main characteristics of a Singapore hedge fund?
The hedge fund is a private investment vehicle that uses complex strategies to invest money that is pooled from various categories of participants (mainly professional, qualified and institutional investors).
What types of hedge funds can I create in Singapore?
Foreign investors looking to open hedge funds in Singapore have two possibilities:
- to set up an onshore hedge fund,
- to open an offshore hedge fund.
Onshore hedge funds are required to abide by Singapore’s licensing regulations and can be divided into:
- open-ended trust funds,
- closed-ended funds,
- limited liability partnerships.
While offshore earnings can only be given to Singaporean domestic citizens at the MAS’s (Monetary Authority in Singapore) discretion, domestic funds can service to both offshore and onshore clients.
Here is also an infographic on this subject:
What are the forms I can use to set up a hedge fund in Singapore?
The hedge fund enters the category of Collective Investment Schemes and is usually created as a Variable Capital Company (VCC). However, depending on the investment strategy used, you can also register it as a:
- company;
- unit trust;
- limited partnership.
You can rely on our Singapore company formation specialists for remote support in setting up the business form for your future hedge fund.
What are the requirements to create an investment management company in Singapore?
For administration purposes, the management company can take one of the following forms:
- of a Licensed Fund Management Company (LFMC), which is subject to a Capital Markets Services license, and a minimum capital of SGD 250,000;
- of a Venture Capital Fund Manager (VCFM), which must have a physical office in Singapore, as it is subject to less stringent requirements.
NOTE: In case of Singapore hedge funds with fewer than 30 accredited/institutional investors, there is no need to create/hire an investment management company.
What are the documents required to obtain a license for a hedge fund in Singapore?
The following must be submitted to the Monetary Authority of Singapore:
- details about the fund: a description of its activities, investment strategies, and projected performance;
- details about the director of the fund;
- information about the owner(s);
- copies of the contracts entered into by the investment fund.
How long does it take to open a hedge fund in Singapore?
It takes between 3 and 6 months. A longer period may occur in the case of licensed funds.
The video below shows the main steps to set up a hedge fund in Singapore:
What are the activities a Singapore hedge fund can undertake?
Under the CMS license, a management company can offer the following services:
- securities trading and funding;
- futures contracts;
- trading in foreign exchange with leverage;
- providing corporate financial advice;
- management of trusts for real estate investments;
- supplying custodial services.
Under the Financial Advisor’s license, a company can engage in the following activities:
- promotion of unit trusts;
- provision of life insurance goods;
- services for providing advice on investment goods, such as foreign exchange contracts and life insurance policies;
- investment report issuance.
Our consultants can advise on how to set up a company in Singapore to create an investment fund management company. We can also handle the registration of the selected business entity for this reason.
Those who want to set up offshore hedge funds but want to provide their services in Singapore must respect certain compliance requirements. If you need help applying for an investment license or want to open a company in Singapore, you can contact our Singapore company formation agents.