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Setting Up a Variable Capital Companies (VCC) for Investment Funds in Singapore

Variable Capital Company (VCC), a type of corporate entity, is tailor-made for investment funds. The VCC can be set up as a single standalone/non-umbrella fund, or as an umbrella fund with two or more sub-funds, each without legal personality and having segregated assets and liabilities from the other.

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

Some of the features of a VCC are:

• 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.

• A VCC will not be required to disclose its register of members to the public, but this register must be disclosed to public authorities upon request for 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 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.

Appointing Directors, Company Secretary and Other Key Persons

Officers/Key Persons of a VCC include the following:


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 citizens, Permanent residents or holders of EntrePass/Employment Pass) with a local residential address. Every VCC must also have at least 1 director who is either a Qualified Representative (as defined under the VCC Act) or a director of its fund manager. A VCC director must be a Singapore Citizen, Singapore Permanent Resident or EntrePass holder. A director may also be an Employment Pass (EP) holder.


Every VCC must appoint an auditor.

Foreigners Who Wish to Incorporate a VCC in Singapore

Foreigners wishing 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.

Fund Manager

A VCC must appoint a Permissible Fund Manager to manage its property or operate the collective investment schemes (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;

  • 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 sections 99(1)(a), (b), (c) or (d) of the Securities and Futures Act 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 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)

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, as stipulated in section 46(2) of the VCC Act.

Registered Office Address

You must provide a registered office address when you incorporate a VCC. 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.


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 during incorporation/registration. 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. Processing time for Incorporation of VCC

It will take up to 14 days to be processed.

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

Sub-funds can only be registered under an umbrella VCC. The information required to complete the transaction is proposed name of sub-fund and date of formation of sub-fund.


The name application fee is $15. The incorporation fee is $8,000. The filing fee for registration of sub-fund is $400.

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.

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