Variable Capital Company (VCC)
A VCC is a variable capital company, which is a new corporate structure for investment funds in Singapore. A VCC can serve both open-ended and closed-end funds, either as a standalone or with multiple sub-funds. It has a flexible capital structure that allows it to issue and redeem shares without affecting its legal status.
This page covers information on opening a Variable Capital Company (VCC) in Singapore. Outlining the basics of registration process, the fees, the annual filing requirements, the tax requirements.Â
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Variable Capital Company (VCC) : Key Features
Key Features : Structures, Strategies and Schemes
Opening a VCC in Singapore requires meeting legal and regulatory standards, including appointing a fund manager, maintaining a registered office, having a resident director, meeting fit and proper criteria, and complying with AML/CFT requirements.
- A licensed or registered fund manager by the Monetary Authority of Singapore (MAS) must manage a VCC for proper oversight. The VCC must have a registered office in Singapore, accessible to the public during business hours, where essential documents are kept.
- A VCC must have at least one director who is a resident of Singapore and a director or representative of the fund manager. Approved schemes require at least three directors, with at least two being independent of the fund manager and service providers.
- Directors, shareholders, beneficial owners, and nominee directors of a VCC must meet MAS’s fit and proper criteria, showing competence, integrity, reputation, and financial soundness. AML/CFT compliance is also mandatory, including risk assessments, due diligence, transaction monitoring, and appointing an eligible financial institution for checks.
Overall, full compliance with relevant regulations and guidelines is essential to mitigate risks of money laundering and terrorism financing.
Set-up Your VCC with Hub
Incorporate a VCC Package
- Incorporation of a Variable Capital Company
- 12 months Company Secretary
- 12 months Registered Address
- * Excluding Fee for Annual Filing
Set-Up VCC In Singapore
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Variable Capital Company (VCC) : Compliance Requirements and Benefits
Why incorporate a VCC?Â
Flexibility
A VCC can accommodate various types of investment funds, such as hedge funds, private equity funds, venture capital funds, real estate funds, etc. A VCC can also be set up as a standalone fund or an umbrella fund with multiple sub-funds, each with its own investment strategy and asset-liability segregation
Re-domiciliation
A VCC can be incorporated in Singapore or re-domiciled from another jurisdiction by transferring its registration to Singapore as a VCC. This allows fund managers to leverage on Singapore’s reputation as a leading financial centre and enjoy the benefits of the VCC framework without having to liquidate their existing foreign funds.
Tax incentives
A VCC may enjoy various tax incentives and exemptions that are available for investment funds in Singapore, such as the Enhanced-Tier Fund Scheme, the Singapore Resident Fund Scheme, the Offshore Fund Scheme, the Onshore Fund Scheme, etc. These schemes provide tax concessions or exemptions for qualifying income and gains derived by the VCC from its investments.
VCC grant scheme
To encourage the adoption of the VCC framework, the MAS has introduced a VCC grant scheme that co-funds up to 70% of eligible expenses paid to Singapore-based service providers for incorporating or registering a VCC. The grant is capped at SGD 150,000 per VCC, subject to a maximum of three VCCs per fund manager.
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Compliance RequirementsÂ
Opening a VCC in Singapore requires complying with legal and regulatory requirements to ensure integrity and transparency. These include appointing a permissible fund manager, maintaining a registered office in Singapore, having at least one resident director, meeting fit and proper criteria, and complying with AML/CFT requirements.
- A VCC must be managed by a permissible fund manager, licensed or registered by the Monetary Authority of Singapore (MAS), ensuring proper oversight and governance. It must also have a registered office in Singapore, accessible to the public during business hours, where essential registers and documents are kept.
- Additionally, a VCC must have at least one director who is a resident of Singapore and a director or representative of the permissible fund manager. Approved schemes require at least three directors, with at least two being independent from the fund manager and service providers.
- Directors, shareholders, beneficial owners, and nominee directors of a VCC must meet MAS’s fit and proper criteria, demonstrating competence, integrity, reputation, and financial soundness. Compliance with AML/CFT requirements is mandatory, including conducting risk assessments, due diligence, transaction monitoring, and appointing an eligible financial institution for checks.
Overall, full compliance with relevant regulations and guidelines is essential to mitigate risks associated with money laundering and terrorism financing.
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