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If you want to start a fund management company for accredited investors in Singapore, consider getting a Licensed Fund Management Company (Accredited Investor) License from the Monetary Authority of Singapore. It shows you have the expertise and qualifications to provide high-quality fund management services. The license is unlimited to the number of accredited investors you can serve, meaning a company has a significant opportunity to expand.
Firstly, fund management companies can offer accredited investors varying investment products and services, including access to more sophisticated investment strategies.
Secondly, the license allows for regulatory oversight and enhances transparency, promoting investor confidence in the financial system.
Thirdly, the LFMC license demonstrates the company’s commitment to maintaining high governance standards, risk management, and compliance, which can differentiate them from its competitors and attract more investors.
Finally, the LFMC license is a prerequisite for accessing certain markets and participating in various investment activities, which can expand the company’s business opportunities and generate more revenue.
The processing time for the LFMC (Accredited Investor) License application is around 4 to 6 months. However, the time does vary depending on the application’s completeness, and the business’s complexity.
The LFMC (Accredited Investor) License fee in Singapore is S$4,000 for application.
Below are six requirements for obtaining the LFMC (Accredited Investor) License in Singapore.
Your company must be incorporated in Singapore to apply for the LFMC (Accredited Investor) License. It should be registered with the Accounting and Corporate Regulatory Authority (ACRA). In addition, it must have a physical office in Singapore, and the general public should not be allowed to enter it. Only the board managers and staff should be authorized.
A fund management company of this nature must comply with the MAS regulation on the ‘fit and proper’ criteria. According to the Monetary Authority of Singapore (MAS), the directors and key executives of the company must meet the fit and proper criteria. This means they must be honest, competent, and capable of managing the business of the company.
The MAS Anti-Money Laundering and CFT Requirements set out the regulatory obligations for fund management companies operating with accredited investor clients. This is a requirement for LFMC -A/I company. The requirements include doing risk-based customer due diligence, ongoing monitoring of transactions, and reporting suspicious transactions to the authorities.
The company must have a risk management framework. The Framework provides guidance for fund management companies to effectively manage and mitigate risks resulting from accredited investor clients. It covers critical areas such as governance, risk assessment, risk mitigation, and internal controls. The Framework aims to ensure fund management companies have appropriate measures to manage risks and protect their clients and financial systems from potential harm
The Monetary Authority of Singapore sets out the minimum capital adequacy standards that fund management companies must maintain to ensure their financial soundness and ability to meet obligations. The requirement helps to promote financial stability and protect investors by reducing the likelihood of a fund management company failing due to insufficient capital.
The compliances listed here are only partial additional ones that may arise depending on the specific circumstances of the LFMC. Always seek professional advice to meet all relevant compliances. We will look at some of the annual compliances for the LFMC (Accredited Investor) license in Singapore:
Here are some reasons why submitting financial statements annually is vital for LFMC (Accredited Investor) license holders in Singapore:
In Singapore, LFMC (Accredited Investor) license holders must submit their financial statements to the Accounting and Corporate Regulatory Authority (ACRA) within five months of their financial year-end. For example, if a company’s financial year-end is 31 December, the financial statements should be submitted to ACRA by 31 May of the following year.
If LFMC (Accredited Investor) license holders in Singapore do not submit their financial statements on time, they may face penalties or fines. The penalty or fine may vary depending on the delay’s duration and the company’s size. In some cases, repeated failure to submit financial statements may result in the revocation of the LFMC license.
The processing time for the LFMC (Accredited Investor) License application in Singapore is typically around four months.
The LFMC (Accredited Investor) License application fee in Singapore is S$4,000.
To be eligible for the LFMC (Accredited Investor) License in Singapore, the company must be a Singapore-incorporated company, have a minimum paid-up capital of S$250,000, and meet other requirements set by the Monetary Authority of Singapore (MAS).
The documents required for the LFMC (Accredited Investor) License application include the completed application form, business plan, organizational chart, financial statements, and other supporting documents.
The LFMC (Accredited Investor) License application can be submitted online through the MAS portal.
Yes, you can engage a professional firm, such as a law or accounting firm, to assist with the LFMC (Accredited Investor) License application.
The LFMC (Accredited Investor) License issued by the Monetary Authority of Singapore (MAS) only permits the licensed company to operate in Singapore. Therefore, the company must comply with the existing relevant regulations if it wishes to work in other jurisdictions.