Singapore proposes changes to funds rules in 2024 budget

RegulationSingapore is set to extend a scheme designed to provide more flexibility to fund managers operating in the country as part of its budget for this year. Under the Budget 2024 announced on February 16, the 13O scheme is set to be expanded to cover not just funds set up in the form of Singapore-based companies but also funds established as limited partnerships registered in Singapore. The changes are expected to take effect as of January 2025. The proposed move has been welcomed by PwC as providing flexibility for Singapore-based fund managers in choosing the suitable legal form for their investment funds. This is especially so for funds that do not meet the criteria of an earlier scheme (13U) in terms of minimum fund size and other qualifying conditions. However, PwC has also raised some concern over the proposed timing of the changes. The details of any amendments are only expected to be published in late 2024, despite the fact that the implementation date is January 2025. “The short lead time may pose challenges for fund managers seeking to raise new funds given the uncertainty of how the revised conditions may apply,” stated PwC. “Investors may question whether the funds are able to meet the revised conditions under sections 13D, 13O or 13U and the lack of certainty may delay the fund launch process, in turn adding more uncertainty in a difficult fundraising environment.” © 2024 funds global asia

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