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Family Offices in Singapore
What is it?
There is a growing need amongst high-net-worth families for institutional management of their private wealth. Family offices address this need, being investment vehicles for structuring the way families invest and transfer their wealth to future generations.
Singapore has positioned itself as the top choice for family offices in Asia. As a leading financial hub, Singapore has a reputation for political and operational stability, clear tax and regulatory regime.
To improve the professionalism of family office professionals in Singapore, and to enhance the positive spillovers to the Singapore economy, MAS has updated the conditions for the above schemes (now known as the S13O Scheme and S13U Scheme respectively).
These changes come into effect on 18 April 2022 and incorporate the following changes:
On the business spending requirement, it should be noted that expenses incurred should relate to the operating activities (as opposed to financing activities) of the fund. Typical expenditure includes, but are not limited to, remuneration, management fees, tax advisory fees, and operating costs. The minimum business spending is governed by a tiered framework set out below:
What You need To Know
Which Funds do the Updated Conditions Apply To?
An exempt fund management company ("FMC") which manages assets for or on behalf of the family(ies)
To be an exempt FMC, a company must be exempted from the requirement to hold a Capital Markets Services ("CMS") licence to conduct activities regulated under the Securities and Futures Act.
Family offices can generally rely on the automatic exemption provided for corporations which manage funds for their related corporations under paragraph 5(1)(b) of the Second Schedule to the Securities and Futures (Licensing and Conduct of Business) Regulations.
Wholly owned or controlled by members of the same family(ies).
Under the Guidelines, "family" includes lineal descendants from a single ancestor, together with (i) spouses and ex- spouses, and (ii) adopted and stepchildren.
all the way through.
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