top of page
  • a22162

Variable Capital Companies (VCC)

Updated: Nov 7, 2023

A Variable Capital Company (VCC) is a type of corporate entity which is tailor-made for collective investment schemes (CIS).

The VCC:

  • provides greater flexibility, thereby facilitating investment fund operations and catering to the needs of global investment funds;

  • helps fund managers in Singapore reap economies of scale and achieve cost efficiencies; and

  • facilitates re-domiciliation.

A VCC must appoint a Permissible Fund Manager to manage its property or operate the CIS that comprises the VCC. A Permissible Fund Manager refers to:

  • A licensed fund management company which holds a capital markets services licence for fund management under the Securities and Futures Act (SFA);

  • A registered fund management company which is registered under paragraph 5(1)(i) of the Second Schedule to the Securities and Futures (Licensing and Conduct of Business) Regulations;

  • A financial institution exempted under section 99(1)(a), (b), (c) or (d) of the Securities and Futures Act (SFA) from the requirement to hold a capital markets services licence to carry on business in fund management, i.e. a bank licensed under the Banking Act (Cap. 19), a merchant bank approved under the Monetary Authority of Singapore (MAS) Act (Cap. 186), a finance company licensed under the Finance Companies Act (Cap. 108) or a company or co-operative society licensed under the Insurance Act (Cap. 142)

All VCCs must be managed by a Permissible Fund Manager. Fund managers will be able to constitute investment funds as VCCs across both traditional and alternative strategies, and as open-ended or closed-end funds. Fund managers may also incorporate new VCCs or re-domicile their existing investment funds with comparable structures by transferring their registration to Singapore as VCCs.

Key Features of a VCC

  • A VCC has a separate legal personality from the directors.

  • A VCC will have members (also commonly known as shareholders).

  • A VCC will have a board of directors responsible for the governance of the VCC’s operations. This board of directors of a VCC is the equivalent of the board of directors in a company incorporated under the CA.

  • A VCC must be managed by a Permissible Fund Manager, regulated by the Monetary Authority of Singapore (MAS).

  • A VCC has a variable capital structure that provides flexibility in the issuance and redemption of its shares. It can also pay dividends out of capital, which gives fund managers flexibility to meet dividend payment obligations.

  • A VCC can be set up as a single standalone fund/non-umbrella fund, or as an umbrella fund with two or more sub-funds, each without legal personality and having a portfolio of segregated assets and liabilities from the other. For fund managers that structure their funds as umbrella VCCs, there may be cost efficiencies from using common service providers across the umbrella and its sub-funds.

  • VCCs must maintain a register of shareholders. A VCC will not be required to disclose its register of members to the public. However, this register must be disclosed to public authorities upon request for regulatory, supervisory and law enforcement purposes.

  • A VCC will be required to engage an eligible financial institution regulated and supervised by MAS for AML/CFT purposes to conduct the necessary checks and perform the measures in order for the VCC to comply with the relevant parts of the VCC AML/CFT Notice.

  • A VCC can issue and redeem shares without the need for member/ shareholder approval.

  • A VCC can pay dividends out of capital, and not only out of profits.

  • A VCC can be structured as an open-ended fund, or as a closed-end fund.

An open-ended fund allows investors to redeem their investments at their discretion, while a closed-end fund does not permit investors to do so. Closed-end funds also have a fixed number of shares and do not allow new subscriptions after the offering period is over, while open-ended funds are open to new subscriptions by new investors at any time.

  • Fund managers may incorporate new VCCs or re-domicile their existing overseas investment funds with comparable structures by transferring their registration to Singapore as VCCs.

  • A VCC can use either Singapore or other recognised international accounting standards (namely, International Financial Reporting Standards (IFRS) and US Generally Accepted Accounting Principles (US GAAP)) for the preparation of its financial statements.

Information Required for Setting Up a VCC

1. Proposed VCC name

The first step is to choose and register a suitable name for your VCC. Every business needs a name to uniquely identify itself and to make it easy for others to find the business.

2. Type of VCC

A VCC can be set up as as a non-umbrella VCC or an umbrella VCC with two or more sub-funds, each holding a portfolio of segregated assets and liabilities.

3. Details of proposed director and VCC officers / Details of at least 1 director who is either a director or qualified representative of the fund manager of VCC;

The next step is to appoint the Directors, Company Secretary and Other Key Persons. You will need to provide their personal identification details (including ID number, ID type and Nationality), contact information (e.g. telephone number and email address) and residential address.


A director is the person in charge of managing the affairs of the VCC. He/she must take decisions objectively in the best interests of the VCC. Every VCC must have at least 1 director who is ordinarily resident in Singapore (e.g. Singapore Citizen, Singapore Permanent Resident or holder of EntrePass/Employment Pass (EP)) with a local residential address. Every VCC must also have at least 1 director (who may be the same person that is ordinarily resident in Singapore) who is either a Qualified Representative or a director of its fund manager.

VCCs consisting of Authorised Schemes must have at least 3 directors including 1 independent director. Authorised Scheme refers to a collective investment scheme (CIS) as defined under section 2(1) of the Securities and Futures Act (SFA) that is constituted in Singapore and authorised by MAS under section 286(1) of the SFA.

Here are the basic requirements for a VCC director. He/she must be:

  • At least 18 years old;

  • Of full legal capacity;

  • A Singapore Citizen, Singapore Permanent Resident or EntrePass holder;

  • A director may also be an Employment Pass (EP) holder. However, an EP holder wishing to become a director of a VCC must first get a Letter of Consent (LOC);

  • FIN holders are advised to seek consent from the relevant pass issuing authority (e.g. MOM/ ICA) before registering or taking on appointment (e.g. Director, Secretary) ; and

  • Cannot be disqualified from acting as a director of a VCC e.g. an undischarged bankrupt.

Foreigners who wish to incorporate a VCC in Singapore must employ a director who meets the requirements on Directors. You may choose to reside outside of Singapore after setting up your VCC. However, if you wish to be present in Singapore to manage the VCC’s operations, you must seek approval from the Ministry of Manpower (MOM).

Managing Director

A VCC can choose to appoint a Managing Director, who must also be a director of the VCC, to manage and oversee all or part of the business. It is not compulsory to appoint a Managing Director.

Company Secretary

A VCC must appoint a secretary. A company secretary must be:

  • A natural person; and

  • Ordinarily resident in Singapore.

The sole director of a VCC and the company secretary cannot be the same person.


Every VCC must appoint an auditor. VCCs cannot be exempted from audit.

4. Details of Permissible Fund Manager

You will need to provide the Permissible Fund Manager’s Unique Entity Number (UEN), full name, address of the fund manager’s principal place of business and country of incorporation when submitting the application to incorporate a VCC. In addition, you will also need to provide a declaration by the Permissible Fund Manager that it has consented to act as the fund manager of the VCC and fulfils one of the above criteria for a Permissible Fund Manager.

5. Details of subscribers

Information required includes ID number, name of subscriber and email address.

6. Registered office address and opening hours

You must provide a registered office address. A registered office address refers to the place where all communications and notices to the VCC are addressed to, and the place where the VCC’s register and records are kept.

7. Copy of Constitution

The constitution is a legal document that: • Describes the key characteristics of the VCC; • Contains the rules and regulations for its governance; • Describes how its operations will be carried out; and • States the rights and responsibilities of the directors, shareholders and company secretary. The applicant must attach a copy of the constitution. The constitution document lodged with the Registrar will not be available to members of public but must be disclosed to public authorities upon request for supervisory and law enforcement purposes.

You may adopt the VCC model constitutions. Alternatively, you can submit a customised constitution.

8. Financial Year End (FYE)

This will determine when the VCC’s corporate filings and taxes are due.

Common FYEs can include 31 March, 30 June, 30 September or 31 December.

9. In-Principle Approval Obtained from Other Authorities (if any)

Registration of Sub-fund(s) for an Umbrella VCC

Sub-funds can only be registered under an umbrella VCC. The information required is:

  • Proposed name of sub-fund

  • Date of formation of sub-fund

Processing Time for Incorporation of VCC

It may take between 14 to 60 days to process the application for incorporation of VCC.


The fee for name application and incorporation is $8,015. The filing fee for registration of sub-fund is $400. Application of transfer of registration is $9,000 + S$400 (sub-fund registration fee) x no. of sub-funds.


Foreigners who wish to incorporate a VCC in Singapore may engage the services of Bestar. Bestar advises clients on the VCC structure and incorporation of a new fund as a VCC and assists funds which are domiciled in other jurisdictions to re-domicile in Singapore as VCCs. If you would like to know more, please contact Bestar.

Variable Capital Companies (VCC)

Variable Capital Companies (VCC) | Bestar
Variable Capital Companies (VCC) | Bestar

393 views0 comments

Recent Posts

See All
bottom of page