Parliamentary Replies
Published Date: 14 July 2015

Reply to Parliamentary Question on Fund Managers




Date: For Parliament Sitting on 13 July 2015

Name and Constituency of Member of Parliament

Mrs Lina Chiam


To ask the Prime Minister, from 2011 to 2014, how many licensed fund managers were exempted from the requirement to hold a capital markets services licence under section 99 of the Securities and Futures Act.

Answer by Mr Tharman Shanmugaratnam, Deputy Prime Minister and Minister in charge of MAS:

1   Prior to August 2012, fund managers who served 30 or less qualified investors1 were not required to hold a capital markets services licence for fund management under the Securities and Futures Act. These fund managers were known as Exempt Fund Managers or EFMs. All other fund managers had to apply for a licence and meet prescribed regulatory requirements. 

2   In August 2012, MAS decided to discontinue the EFM regime and gave the EFMs a grace period to either apply for a licence, or register as Registered Fund Management Companies (RFMC). This was to raise regulatory standards and supervisory oversight of the fund management industry. Unlike EFMs, RFMCs have to meet prescribed admission criteria and business conduct requirements. RFMCs can only serve up to 30 qualified investors and manage up to S$250 million in assets. All other fund managers will require licensing and have to meet regulatory requirements that are more stringent  than those applicable to RFMCs.

3   The number of fund managers who obtained EFM status in 2011 and 2012 (up to August 2012), are as follows:

Jan to Dec 2011: 95
Jan to Aug 2012: 80

When the EFM regime was discontinued in August 2012, there were 527 EFMs. Of the 527 EFMs, 408 applied to be licensed or be registered as a RFMC. The remaining 119 ceased their fund management activity.  All fund managers are listed on the financial institutions directory on the MAS website.

1 A qualified investor is an accredited investor, institutional investor or a fund whose underlying investors are all accredited investors.  An accredited investor who is an individual must have net assets exceeding S$2 million, or annual income of not less than S$300,000; or in the case of a corporation, net assets exceeding S$10 million.