Introduction
In recent years, Singapore has solidified its position as a leading wealth management hub in Asia. For Australian fund managers, this presents a unique opportunity to tap into a vibrant and growing market. However, navigating the process of raising capital in a foreign jurisdiction can be challenging. This blog aims to provide Australian fund managers with an understanding of how to raise capital in Singapore for wholesale funds, highlighting the importance of legal expertise and strategic advice in this endeavour.
Understanding Wholesale (Restricted) Funds in Singapore
Restricted funds in Singapore are investment schemes not authorized or recognized by the Monetary Authority of Singapore (MAS) and are typically offered only to accredited (wholesale and sophisticated) investors. These funds are subject to certain regulatory requirements under the Securities and Futures Act (SFA) but are not available to the general public.
The Process of Raising Capital in Singapore
Step 1: Determine Eligibility
Ensure that your Australian scheme meets the definition of a restricted fund in Singapore and is eligible to be offered to accredited investors. The definition of accredited investors is similar to the current definition of wholesale/sophisticated investor in Australia.
Step 2: Appoint a Local Representative
Engage a local representative or legal firm in Singapore to assist with the registration process and ensure compliance with local regulations.
Step 3: Prepare Offering Documents
Ensure your Australian offering documents that disclose all relevant information about the fund, including investment objectives, risks, fees, and terms. These documents must comply with Singapore's disclosure requirements which can be done with minimal changes.
Step 4: Lodge a Notification with MAS
A notification may need to be lodged with MAS via the OPERA (Offers and Prospectuses Electronic Repository and Access) online portal before the offer is made. To do this you will need a local licenced agent.
Step 5: Market to Accredited Investors
Once regulatory requirements are met, the fund can be marketed to accredited investors in Singapore through private placements or other controlled channels. There is no need to establish a feeder fund in Singapore. Singapore investors can invest directly into the Australian fund.
Step 6: Ongoing Compliance
Ensure ongoing compliance with Singapore's regulatory requirements, including periodic reporting and disclosure obligations.
Why Singapore?
Singapore's appeal as a destination for raising capital lies in its regulatory framework, political stability, competitive tax regime, and strategic location in Asia. The city-state's commitment to wealth management, coupled with its growing affluent consumer base, makes it an attractive market for Australian fund managers looking to expand their reach. It has become the wealth management capital of Asia.
How 62 Consulting Can Help
Navigating the complexities of raising capital in Singapore requires expert guidance. 62 Consulting, with its legal expertise and strategic advice, is well-positioned to assist Australian fund managers in this journey. Our affiliations with Singapore financial services companies enables us to meet your compliance needs for funds looking to enter the Singapore market, providing a seamless and efficient path to capital raising.