Two days prior to its original expiration on 13 January 2023, the Variable Capital Companies (VCC) Grant Scheme was extended for another two years to 15 January 2025.
The MAS introduced this scheme in 2020, which awards Singapore-based asset managers and family offices funding up to 30% of qualifying expenses, including those concurred for legal, administration, tax and compliance solutions. Previously, the funding was at 70%, the only main difference between the original and extended grant. The Financial Sector Development provides the funding, capped at S$30,000 per VCC. Since the scheme was launched in 2020 over 700 VCCs have been successfully set up or have re-domiciled to the city-state.
Alvin Tay, Head of Business Development for Bolder Southeast Asia, believes the grant played a crucial role in the growth of VCCs. He adds, “While the scheme has helped to facilitate the growth of VCCs, Singapore’s position as a global financial centre with political stability and a pro-business environment is equally important to help drive the inflow of managers and investors.”
Under the Extended VCCGC, only first-time qualifying managers can apply, which means those who have previously set up the structure or re-domiciled an entity as such are restricted from applying for the grant. First-time applicants must obtain a Notice of Incorporation or a Notice of Transfer of Registration from the Accounting and Corporate Regulatory Authority dated between 16 January 2023 and 15 January 2025 – the due date of the extension.
Other things to keep in mind when applying for the extended VCCGS:
- The VCC must not be simultaneously funded under other government grants
- The grant is applicable only to qualifying work related to one successfully incorporated or re-domiciled VCC
- Qualifying expenses for the funds and sub-funds (legal, tax, compliance services) must be paid to Singapore-based service providers
- The MAS does not allow a qualifying fund manager to claim co-funding under the Extended VCCGC for sub-fund registration unless it is part of an umbrella VCC
- For new VCCs, managers must submit their applications within three months from the date stated on the ACRA-issued Notice of Incorporation
- For foreign entities re-domiciled as VCC, managers must submit the Notice of Transfer of Registration within three months
Managers must also note that the MAS reserves the right to retrieve any grant given to a VCC if it closes in less than a year after its registration. The authorities require VCCs to be operational for at least one year in order to benefit from the scheme fully. VCCs which would be granted the award under the extended VCCGC and declare closure less than a year after it is registered must inform the MAS of the development within one week. The registration date refers to the date of incorporation stated on the Notice of Incorporation or Notice of Transfer Registration from the ACRA.
Here is a quick overview of setting up a VCC:
- Introduction by a registered agent
- Registering a VCC name
- Determining the VCC type
- Appointing directors, company secretary and other key officers
- Registering office address and constitution
- Incorporating a new VCC
- Registering sub-funds for an umbrella VCC
- VCC filing fees
To apply, managers can request the application form by emailing VCC-FSDF@mas.gov.sg.
Bolder Group can also assist in VCC incorporation or the application for the grant scheme. “Bolder Fund Services Singapore is among the market leaders in the set-up of VCC. Supported by a strong team with relevant experience, Bolder is highly approachable and will be able to help managers navigate through the process of setting up and applying for the grant,” states Tay.
Please get in touch with firstname.lastname@example.org or our Bolder-Singapore representatives.