The Monetary Authority of Singapore (MAS) has responded to feedback received for the consultation paper, published on 24 October 2023, on its proposal to repeal the regulatory regime for Registered Fund Management Companies (RFMCs) and application of such RFMCs to become Licensed Fund Management Companies (LFMCs). This article sets out the timing of repeal and application process, details in relation to the application form, considerations in reviewing applications, continuity of operations, applicable requirements and unsuccessful applicants.

Timing of repeal and application process

MAS targets to repeal the RFMC regime on 1 August 2024. Existing RFMCs intending to continue regulated fund management activity after this date must apply to be an A/I LFMC by completing and submitting the application form, Form 1AR, between 1 April 2024 and 30 June 2024.

MAS will inform RFMCs of the application outcome within a month of submission. MAS expects to issue Capital Markets Services (CMS) licences to all successful applicants by end July 2024.

Exempt representatives of RFMCs that are licenced will become appointed representatives on the same date that the RFMC is licenced and there is no need for the RFMC to file any additional documents for this.

Application form and fees payable

RFMCs that wish to continue regulated fund management activity have to submit Form 1AR. No supporting documents are required at the point of submitting the Form 1AR, save for providing documentation in support of declarations made in Form 1AR that are requested by the MAS.

RFMCs applying to become A/I LFMCs during the prescribed application window will not have to pay any application fee for the corporate entity, nor any fee for the notification of their existing representatives. Upon being licenced, the prevailing CMS annual corporate licence fee and representative fees will apply on a pro-rated basis, to such A/I LFMCs and their representatives. Presently, the annual corporate licence and representative fees for CMS licence holders are S$4,000 and S$200 per representative respectively.

Consideration factors in reviewing Form 1AR applications

MAS will approve an RFMC’s application to be an A/I LFMC if the RFMC:

1. has managed assets attributable to third-party investors in the six months immediately preceding the submission of the form to MAS. This requirement does not apply if the RFMC is registered for six months or less as at the submission date;
2. submits Form 1AR within the stipulated timeline; and
3. satisfactorily furnishes supporting documents to MAS, if requested.

Continuity of operations and applicable requirements during and after application

Throughout the application process, RFMCs can continue operating without disruptions. RFMCs should continue to meet existing RFMC requirements, for example, filing of notifications and annual declarations. Upon being issued a licence, the regulatory requirements for A/I LFMC will take immediate effect. In addition to the above, RFMCs that become A/I LFMCs will have to seek MAS’ prior approval for certain changes, such as their shareholders and key appointment holders. Further, a small number of RFMCs that have been issued written directions and/or have specific conditions imposed on their regulatory status will continue to apply even after these RFMCs become A/I LFMCs.

RFMCs should familiarise themselves with the A/I LFMC regulatory requirements. Resources available on the MAS website that provide guidance include (a) Compliance Toolkit for Approvals, Notifications and Other Regulatory Submissions to MAS for Fund Managers; (b) Guidelines on Licensing, Registration and Conduct of Business for Fund Management Companies; and (c) FAQs on the Licensing and Registration of Fund Management Companies.

Unsuccessful applicants

Generally, RFMCs which have not conducted fund management activity as defined in the Securities and Futures Act 2001 for a continuous period of six months will cease to be registered as RFMCs. They would no longer be allowed to carry on regulated fund management activity and not be issued CMS licences. There will not be an appeal process for these entities.

Generally, fund management companies which intend to cease their fund management business should ensure an orderly winding down of their business operations and consider if it would be in their investors’ interest to be notified of the RFMC’s intentions ahead of the repeal of the regime. This applies to RFMCs which do not apply for or obtain CMS licences.