On 16 January 2023, the Monetary Authority of Singapore (“MAS”) has extended the Variable Capital Companies Grant Scheme (“VCCGS”) for two years from 16 January 2023 to 15 January 2025 (both dates inclusive) (“Extended VCCGS”). Under the Extended VCCGS, applicants may seek co-funding of 30% of qualifying expenses paid to Singapore-based service providers for qualifying work performed in Singapore in relation to the incorporation or registration of a variable capital company (“VCC”), up to a maximum grant cap of S$30,000 per application.
The VCCGS which was first introduced on 15 January 2020 for a period of three years till 15 January 2023, has catalysed the adoption of VCCs in Singapore. The objective of the Extended VCCGS seeks to build on the momentum and continue to broaden VCC adoption, and support more fund managers in setting up their first VCC.
Applicants should be first-time Qualifying Fund Managers that must not have previously incorporated or successfully re-domiciled a VCC and must not have previously applied for the VCCGS.
The Extended VCCGS is available only to Qualifying Fund Managers that have incorporated a VCC or successfully re-domiciled a foreign corporate entity to Singapore as a VCC for the first time, and have obtained a Notice of Incorporation or Notice of Transfer of Registration from the Accounting and Corporate Regulatory Authority (“ACRA”) (as the case may be) which specifies a date between 16 January 2023 and 15 January 2025 (both dates inclusive).
The following conditions apply:
- The set-up of the VCC cannot be simultaneously funded by other government grants/incentives with respect to the same set of qualifying costs and commitments;
- Each applicant may only apply for the Extended VCCGS for qualifying work performed in relation to one VCC that has been incorporated or successfully re-domiciled;
- Qualifying expenses must be paid to Singapore-based service providers for qualifying work performed in Singapore in relation to the incorporation and registration of the VCC and its sub- fund(s) (if any);
- A Qualifying Fund Manager may not claim co-funding under the grant scheme solely for the registration of sub-fund(s) (without the accompanying incorporation or transfer of registration of a VCC). However, a Qualifying Fund Manager may claim qualifying set-up costs incurred for the registration of sub-fund(s) as part of the set-up of an umbrella VCC; and
- Applicants should formally submit their applications within three months from the date specified on the Notice of Incorporation issued by ACRA (for a newly incorporated VCC) or within three months from the date of ACRA’s approval of the VCC’s evidence of de-registration (for a foreign corporate entity re-domiciled to Singapore as a VCC).
Minimum Operational Period
A VCC which has been awarded a grant under the Extended VCCGS is required to remain operational for at least one year from the Registration Date. This means that the VCC cannot be wound up within the first year from the Registration Date. In the event the VCC is wound up within the first year from the Registration Date, the Qualifying Fund Manager is to inform MAS promptly and by no later than one week from the date of the application for the winding up or passing of resolution for a voluntary winding up. MAS reserves the right to claw back the grant awarded if the VCC is wound up within the first year from the Registration Date and/or if the recipient fails to inform MAS of the winding up of the VCC within one week from the date of the winding up.
The 30% co-funding of qualifying expenses (capped at S$30,000 per VCC) are listed as follows:
- Legal services
- Tax services
- Administration and regulatory compliance services
(For full details on qualifying expenses, please refer to the Factsheet as published by the MAS on 13 January 2023.)