Singapore: Singapore Consults On Streamlined Regulatory Framework For Fund Managers

The Monetary Authority of Singapore (MAS) launched a public consultation on 24 October on its proposal to streamline the regulatory framework for fund managers by ending the Registered Fund Management Companies (RFMC) regime.

Existing RFMCs would be required to re-register as Licensed Fund Management Companies (LFMCs), which serve only accredited or institutional investors (A/I LFMCs), to continue carrying out fund management activities in Singapore.

The RFMC regime was introduced in 2012, following the closure of an earlier regime for Exempt Fund Managers (EFMs) to enhance MAS's regulatory oversight of fund management companies and raise the standard of conduct across the fund management industry. EFMs were exempt from licensing and business conduct requirements.

Existing EFMs at that time had the option to apply to become either an RFMC or a LFMC. RFMCs had similar admission criteria and business conduct requirements to LFMCs but were subject to lighter regulatory requirements because they were restricted to managing up to SGD250 million in assets and and up to 30 accredited or institutional investors.

MAS said the RFMC regime has served its purpose in effecting the transition from the EFM regime. Many RFMCs had upgraded to become A/I LFMCs, while most new entrants seeking to conduct fund management in Singapore tended to apply to be A/I LFMCs rather than RFMCs.

Under the proposals, RFMCs that wish to apply to become A/I LFMCs will need to submit a form during a prescribed application window, setting out their assets under management and confirming their ability to comply with the regulatory requirements for A/I LFMCs.

Existing RFMCs can continue operating as usual during the transition process and MAS will retain the SGD250 million limit on the managed assets for RFMC. RFMCs that successfully transit to the A/I LFMC regime will no longer be subject to any limits on the number of investors and can apply to MAS to uplift the limit on managed assets.

RFMCs that apply to become A/I LFMCs will not have to pay any application fees for transition to become A/I LFMCs. The deadline for consultation submissions is 31 December.

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