The impact of Singapore’s Variable Capital Companies

Monday, February 10, 2020 | By Ashish Shah, Director

The impact of Singapore’s Variable Capital Companies

Last year, we discussed how the fund management industry across the globe would feel the effects of Singapore’s 2018 legislation authorizing the creation of Variable Capital Companies (VCCs). Singapore was already a major center for fund management before the VCC legislation passed, and that presence is growing. As of mid-January 2020, a mix of 20 investment funds, including newly incorporated fund entities and existing funds in other jurisdictions seeking re-domiciliation in Singapore, have adopted the new VCC structure.

A VCC provides structure to investment funds. The structure is very flexible and can be used for a variety of open- or close-ended, traditional or alternative investment strategies, including hedge funds, private equity and real estate funds. It also provides a mechanism for existing overseas investment funds to be re-domiciled in Singapore. The VCC concept adds companies, limited partnerships and unit trusts to the types of fund structures available in Singapore.

To qualify as a VCC, the entity’s registered office must be in Singapore. It must also appoint a Singapore-based, MAS-regulated fund manager and a Singapore-based company secretary. Financial statements are not required to be made public, but VCCs are subject to audit by a Singapore-based auditor. These measures are intended to provide a level of transparency meant to prevent unlawful abuse of VCCs.

VCCs offer greater flexibility, more choices, and cost savings and efficiencies. For a more detailed look at how VCCs have become a game-changer in the fund management industry and how SS&C GlobeOp can help you succeed in this new market, download our whitepaper, Understanding Singapore’s Variable Capital Companies.

Alternative Investments, APAC, Asset Management, Real Estate & Property Management

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