NEW FUND STRUCTURE LAUNCHES IN SINGAPORE – VARIABLE CAPITAL COMPANY (“VCC”)

The much-anticipated Singapore Variable Capital Companies (VCC) framework was launched on 15 January 2020. The framework is a collective effort by a number of stakeholders to ensure that a corporate structure is in place that has the operational flexibility and cost savings that can be readily used by a wide range of investment funds.

As part of the launch, 18 fund managers took part in the VCC pilot programme, incorporating or re-domiciling a total of 20 investment funds as VCC. These investment funds comprised venture capital, private equity, hedge fund and Environment and Social and Governance (ESG) strategies, highlighting the viability and flexibility of the VCC framework across diverse use cases.

To encourage fund managers to adopt the VCC, the Monetary Authority of Singapore (MAS) has introduced a VCC Grant Scheme to help to meet the incorporation and registration costs involved with a VCC. MAS will co-fund up to 70% of eligible expenses that are paid to Singapore-based service providers up to a maximum of SGD150,000 for each application, with a maximum of three VCC per fund manager.

HOW CAN DMS HELP?

As the worldwide leader in fund governance, risk + compliance, DMS has played an integral role in the development of the industry over the last two decades and has taken the lead in examining the options available to managers across multiple jurisdictions. Should you wish to know more about the VCC please reach out to your usual DMS contact or to any of our team listed below.