Frequently Asked Questions
Who can be a fund manager of a VCC?
A VCC must be managed by an entity that is licensed by the Monetary Authority of Singapore (“MAS”) under a capital markets services licence for fund management, a registered fund management company, or a financial institution exempted under s99(1)(a)-(d) of the Securities and Futures Act (Cap. 289).
Can different sub-funds in an umbrella VCC be managed by different fund managers?
No. Only one fund manager may be appointed in respect of the VCC. However, the fund manager may appoint sub-advisors that are regulated as fund managers in other jurisdictions, as long as the fund manager retains overall responsibility for the fund management duties.
Does a custodian have to be appointed for VCCs that are private equity/venture capital funds?
A custodian does not have to be appointed for a VCC to be used only for private equity or venture capital investments if interests in the fund are offered only to accredited and/or institutional investors, and the fund manager has (i) disclosed the fact that the assets are not maintained in a trust/custody account with a specified custodian to their investors; (ii) obtained investors’ acknowledgement of this arrangement; and (iii) arranged for an auditor to audit the assets on an annual basis and furnish a report on the audit to the investors.
If all the requirements above are not met, a custodian will have to be appointed in accordance with the relevant regulations. Further, please note that there are specific custodian requirements for investment funds offered to retail investors.
Is there a prescribed minimum or maximum number of shareholders in a VCC?
A VCC must have a minimum of 1 shareholder and there are no prescribed restrictions on the maximum number of shareholders in a VCC.
Does the register of members of a VCC have to be disclosed to the public?
No, the register of members of a VCC is not available for inspection by members of public, nor can it be downloaded from the Accounting and Corporate Regulatory Authority ("ACRA") website. The register of members of a VCC only has to be disclosed to regulatory authorities upon request for regulatory purposes.
Will the Accounting and Corporate Regulatory Authority (ACRA) maintain a register of members for VCCs?
No. Information on allotments, redemptions and transfers of the shares of a VCC will not be required to be lodged with ACRA. The VCC or a service provider engaged by the VCC will be required to maintain such information in its register of members at the VCC’s registered office.
What is the minimum number of directors required for a VCC?
The VCC must have a minimum of 1 director.
However, both of these requirements must be fulfilled:
(i) The VCC must have at least one director who is a director or a qualified representative (as defined in the VCC Act) of the VCC’s fund manager, and
(ii) One director who is ordinarily resident in Singapore.
Can a VCC take on debt/ issue debentures?
Yes, a VCC may take on debt and issue debentures. The VCC will be required to keep a register of holders of debentures which shall be open to the inspection of the registered holder of any debentures or shares in the VCC.
Can a charge be created over the assets of a VCC?
Yes, a charge can be created by a VCC over the assets of a VCC (including a charge over any property or undertaking of a sub-fund of the VCC). The requirement for registration of charges created by a VCC are similar to those of a company.
Can a sub-fund of a VCC hold shares in another sub-fund of the same VCC?
Yes. An umbrella VCC may, for the account of any of its sub‑funds and in accordance with regulations prescribed under the VCC Act, hold shares of any class or classes that are issued in respect of other sub‑funds of the same VCC.
Is it compulsory for there to be an audit of the financial statements of the VCC?
Yes. To provide assurance that the financial statements of VCCs are properly prepared, VCCs must appoint an accounting entity to audit its financial statements on an annual basis. However, VCCs are not required to have an audit committee.
Should the financial statements of sub-funds of an umbrella VCC be consolidated?
Financial information of each sub-fund of a VCC must be kept separate, but must be prepared in accordance with a single accounting standard across all sub-funds of the VCC.
Are VCCs subject to anti money-laundering / countering the financing of terrorism ("AML/CFT") requirements?
VCCs will be subject to AML/CFT requirements. While a VCC is required to outsource the performance of its AML/CFT obligations to an eligible financial institution (prescribed entities supervised by MAS for AML/CFT purposes), the VCC will remain ultimately responsible for compliance with the AML/CFT obligations.
Can the appointed eligible financial institution then outsource a VCC’s AML/CFT functions?
Yes, the appointed eligible financial institution may then outsource the AML/CFT functions to service providers which may or may not be regulated by MAS (such as a fund administrator). However, such an outsourcing will not absolve the eligible financial institution of its responsibilities.
Does a VCC have to comply with the MAS outsourcing guidelines in relation to the outsourcing of its AML/CFT obligations to eligible financial institutions?
Although the MAS Outsourcing Guidelines do not apply to a VCC since it is not a financial institution regulated by MAS, any outsourcing arrangements that a VCC enters into for the performance of its AML/CFT duties should be in line with the guidelines.
Are there any ongoing fees payable for a VCC?
A VCC has to lodge annual returns for which the filing fees are S$1,600.
Is a company secretary required for a VCC and are there are special qualifications a company secretary of a VCC is required to have?
Yes, a VCC is required to appoint a company secretary within 6 months of incorporation.
What is the regime for disclosure of director’s interests for VCCs?
A director of a VCC has a similar statutory duty to disclose conflicts of interest as that imposed on directors of companies incorporated under the Companies Act (Cap. 50). The common law fiduciary duties imposed on directors of companies also applies to directors of a VCC.
