Updates to Singapore's Proposed Fund Management Regulatory Regime | White & Case LLP International Law Firm, Global Law Practice
Updates to Singapore's Proposed Fund Management Regulatory Regime

Updates to Singapore's Proposed Fund Management Regulatory Regime

On 27 September 2011, the Monetary Authority of Singapore ("MAS") issued a consultation paper titled, "Proposed Enhancements and Draft Legislative Amendments to Give Effect to the Regulatory Regime for Fund Management Companies" (the "2011 Consultation Paper") seeking public comments on draft legislative changes and further proposed enhancements to the regulatory regime. The consultation period ends on 26 October 2011.

Key enhancements recently proposed in the 2011 Consultation Paper:

1) All fund management companies ("FMCs") to put in place a risk management framework to identify, monitor and manage risks associated with customer assets managed;
2) All FMCs to provide independent annual audited reports on financial statements and compliance with key licensing and business conduct requirements;
3) New online registration and reporting system to be put in place by the MAS – all FMCs to be charged an annual administrative fee with effect from 1 January 2013.

The 2011 Consultation Paper is a follow-on to the consultation paper that was issued by the MAS in April 2010 (the "2010 Consultation Paper") wherein the MAS had set out proposed policy changes to the regulatory regime for FMCs in Singapore.

The 2010 and 2011 Consultation Papers together outline comprehensive proposed changes to the current regulatory regime, imposing new competency, business conduct, risk management and capital requirements on FMCs. The revised regime is expected to take effect in early 2012. This Client Alert seeks to set out the consolidated proposed changes that will affect FMCs that are currently operating or looking to establish an office in Singapore and serving only institutional and accredited investors. Although the proposed changes will also affect FMCs that serve retail investors, those changes are not within the scope of this Client Alert.

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