Proposed changes to fund management regulatory regime in Singapore: MAS responds to feedback with useful guidance and clarification | Practical Law

Proposed changes to fund management regulatory regime in Singapore: MAS responds to feedback with useful guidance and clarification | Practical Law

This article is part of the PLC Global Finance November 2010 e-mail update for Singapore.

Proposed changes to fund management regulatory regime in Singapore: MAS responds to feedback with useful guidance and clarification

by Allen & Gledhill LLP
Published on 30 Nov 2010 • Singapore
This article is part of the PLC Global Finance November 2010 e-mail update for Singapore.
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The Monetary Authority of Singapore has released its response to the feedback received on its proposed changes to the fund management regulatory regime in Singapore.
The Monetary Authority of Singapore (the MAS) has released its response to the feedback received on its proposed changes to the fund management regulatory regime in Singapore. In the response issued on 28 September 2010 (the Response), the MAS provided useful guidance and clarification on various issues.
The MAS had issued a consultation paper on 27 April 2010 proposing changes which seek to enhance the supervisory oversight over entities currently operating under the exemption regime, and to raise the quality of players entering the fund management industry.

Scope of MAS response

The MAS Response addressed various issues including:
  • Institutional investors and limited partnership fund structures.
  • Employee investments funds managed by their employer.
  • Competency requirements - proposed requirement for two experienced professionals.
  • Custody and fund administration requirements, applicability to private equity and venture capital funds and real estate/infrastructure funds.
  • Compliance arrangements - use of head office compliance function.
  • Capital requirements - computation of operational risk requirement (ORR) and additional floor on ORR.
  • Provision of sub-advisory services to another fund management company.

Expected implementation time frame

The MAS will consult the industry on draft legislation to implement the proposed changes. The legislative changes are expected to be put into effect in the second half of 2011 and there will be a six-month transitional period before the amendments take effect.

Transitional arrangements: current regulatory regime remains status quo

The MAS stated that the current regulatory regime for FMCs will remain status quo until legislative amendments are made to implement the proposed changes.
For more details on the MAS response, please click here.