Introduced in 2020, a Variable Capital Company (VCC) is a type of legal vehicle which is tailor-made for collective investment schemes (CIS).

Some of the features of a VCC are:

• A VCC has a separate legal personality from the directors.

• A VCC will have members (also commonly known as shareholders).

• A VCC will have a board of directors responsible for the governance of the VCC’s operations. This board of directors of a VCC is the equivalent of the board of directors in a company incorporated under the CA.

• A VCC must be managed by a Permissible Fund Manager (please refer to the section “Fund Manager” below), regulated by the Monetary Authority of Singapore (MAS).

• A VCC can be set up as a single standalone/non-umbrella fund, or as an umbrella fund with one or more sub-funds, each without legal personality and having segregated assets and liabilities from the other.

• A VCC will not be required to disclose its register of members to the public, but this register must be disclosed to public authorities upon request for supervisory and law enforcement purposes.

• A VCC will be required to engage an eligible financial institution regulated and supervised by MAS for AML/CFT purposes to conduct the necessary checks and perform the measures in order for the VCC to comply with the relevant parts of the VCC AML/CFT Notice. 

• A VCC can issue and redeem shares without the need for member/ shareholder approval.

• A VCC can pay dividends out of capital, and not only out of profits.

• A VCC can use either Singapore or other recognised international accounting standards (namely, International Financial Reporting Standards (IFRS) and US Generally Accepted Accounting Principles (US GAAP)) for the preparation of its financial statements.

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