Home > Publications > 4 Key Aspects of Variable Capital Companies Grant Scheme in Singapore
The Variable Capital Companies (VCC) Grant Scheme in Singapore isn't just a programme; it's a guiding light for both fund managers and businesses. Representing the nation’s dedication to fostering innovation and nurturing financial growth, this scheme significantly reshapes the asset management industry. Through the provision of financial support and incentives, the scheme encourages businesses to engage in the flourishing domestic financial ecosystem. In this article, we dive into the key aspects of this initiative.
What is the Variable Capital Companies (VCC) Grant Scheme?
The VCC Grant Scheme serves as a catalyst for growth and innovation within the VCC landscape. It aims to bolster the competitiveness of VCCs by providing them with financial assistance and incentives. Companies can leverage this scheme to access funding for a spectrum of activities, including research and development, adoption of technology, market expansion, and talent development.
The VCC Grant Scheme is designed to encourage the establishment and growth of Variable Capital Companies in Singapore.
Companies applying for the grant must be registered as VCCs under the Variable Capital Companies Act.
The VCC Grant Scheme covers a portion of the eligible expenses incurred during the establishment of a VCC.
The grant amount is determined based on the nature and scale of the proposed activities.
The VCC Grant Scheme is an ongoing initiative and applicants are encouraged to check for specific submission deadlines and review cycles.
Who is eligible for the Variable Capital Companies (VCC) Grant Scheme?
Applicants who wish to apply for the VCC Grant Scheme must be first-time qualifying fund managers with no prior experience in incorporating or successfully re-domiciling a VCC. In addition, they must not have applied for the Variable Capital Companies Grant Scheme (VCCG).
Grant Eligibility
The Extended VCCG is available only to qualifying fund managers who have incorporated a VCC or successfully re-domiciled a foreign corporate entity to Singapore as a VCC between 16 Jan 2023 to 15 Jan 2025.
In addition, they must meet the following conditions:
The setup of the VCC cannot be funded by other government grants or incentives for the same set of qualifying costs and commitments.
Each applicant may apply for the Extended VCCGS only for qualifying work related to one VCC that has been incorporated or successfully re-domiciled.
Qualifying expenses must be paid to Singapore-based service providers for work performed in Singapore related to the incorporation and registration of the VCC and its sub-funds (if any).
A Qualifying Fund Manager cannot claim co-funding under the grant scheme solely for the registration of sub-funds without the accompanying incorporation or transfer of registration of a VCC. However, they may claim qualifying setup costs incurred for the registration of sub-funds as part of an umbrella VCC setup.
Applicants must 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 that receives a grant under the Extended VCCGS must remain operational for at least one year from the Registration Date, meaning it cannot be dissolved within the first year. If the VCC is wound up within this period, the Qualifying Fund Manager must promptly notify MAS, no later than one week from the application date or the resolution date for voluntary winding up. MAS reserves the right to reclaim the grant if the VCC is dissolved within the first year from the Registration Date or if the recipient fails to notify MAS of the winding up within the specified timeframe.
VCC Funding
The 30% co-funding provided by the VCC Grant Scheme is capped at SGD30,000 per VCC, and it only applies to the following expenses:
Legal services
Tax services
Adminstration or regulatory compliance services
1. Understanding the Objectives
The VCC Grant Scheme embodies Singapore's vision to become the preferred fund domicile by actively encouraging the establishment of VCCs within the country. This initiative not only enhances Singapore's global standing in asset management but also boosts innovation. Moreover, the coexistence of diverse VCCs fosters healthy competition. Inspiring businesses to improve their services can ultimately enrich the spectrum of choices available to investors. With a commitment to foster continuous growth, a dynamic and prosperous future becomes attainable for all stakeholders, including businesses and investors.
2. Navigating the Eligibility Criteria
To truly understand what the VCC Grant Scheme is, one of the most important aspects is to comprehend its eligibility criteria. Navigating these requirements demands attention to detail, beyond being dedicated to meeting the highest standards of professionalism.
3. Benefits That Propel Progress
The VCC Grant Scheme serves as a valuable resource for fund managers aiming to develop or re-domicile their funds. Beyond rendering financial assistance, the scheme acts as a gateway to a vast and influential network within Singapore's financial ecosystem. The network is mainly made up of key industry players, regulatory bodies, and experienced professionals who can offer guidance, mentorship, and collaborative opportunities. Fund managers participating in the VCC Grant Scheme gain access to more than just funding; they become part of a supportive community that promotes knowledge exchange, paving the way for notable growth.
4. Straightforward Grant Application
The grant application for a newly-minted VCC, can in fact be a simple process. First-Time Qualifying Fund Managers who meet the eligibility criteria, are required to maintain a record of all the qualifying incidental costs incurred during incorporation, including legal, tax, administration, or regulatory compliance services, for submission to the Monetary Authority of Singapore within the first three months of incorporation.
Upon exploring the extensive benefits of the VCC Grant Scheme, fund managers can turn their innovative visions into tangible realities. This transformational process also leads to the creation of new businesses, job opportunities, and economic growth, opening up opportunities for a more progressive financial landscape.
VCC.SG is committed to enriching the collective understanding and dialogue within the VCC fund community, ensuring this invaluable resource is available to everyone.
Get in touch with us today to learn more about how we can support your variable capital company establishment.