Reply to Parliamentary Question on Processing Time for Licence Applications
QUESTION NO 2498
NOTICE PAPER 959 OF 2022
FOR WRITTEN ANSWER
Date: For Parliament Sitting on 15 February 2022
Name and Constituency of Member of Parliament
A/P Jamus Jerome Lim, MP, Sengkang GRC
To ask the Prime Minister (a) what is the respective average, minimum and maximum duration from application to the final approval of licences of (i) Registered Fund Management Company (RFMC) (ii) Licensed Fund Management Company (LFMC) and (iii) Venture Capital Fund Management (VCFM); and (b) what are the usual challenges faced by applicants for licences of RFMC, LFMC and VCFM that result in longer-than-usual processing times.
Answer by Mr Tharman Shanmugaratnam, Senior Minister and Minister in charge of MAS:
1 The processing times for applications to conduct fund management activity in Singapore depend on the specific licence type, the proposed business models, the profiles of the applicants, as well as the quality of the submitted application.
The time taken to process a Licensed Fund Management Company or a Registered Fund Management Company application ranges from 1 month to 10 months, with an average of 5 months.
The time take to process a Venture Capital Fund Management application, ranges from 1 month to 6 months, with an average of 3 months.
2 Applicants may face longer processing times and additional engagements with MAS due to the following reasons:
a) Incomplete, inconsistent or erroneous submissions;
b) Insufficiently concrete or credible business plans;
c) Adverse records on key personnel such as the chief executive officer, directors and investment professionals, that were not adequately addressed or disclosed;
d) Insufficient relevant experience of key personnel to carry out the proposed activities; and
e) Significant conflicts of interest with the business interests of key personnel.
3 To aid applicants in the process, MAS has put up on its website, reference guides for licence and registration applications. These guides provide details such as admission criteria, information required in the application, and factors that MAS focuses on when assessing different types of business models. MAS also publishes an annual licensing and registration report that shares average processing times, factors that lead to extended processing times, as well as broad reasons behind unsuccessful applications.
4 Our fund management industry is growing well. In the past two years, applications for fund management licences have seen an uptrend, in line with the growth of the sector. The number of applications grew by 14% in 2021 to almost 300 applications. Application growth was 33% in 2020. MAS has and will continue to enhance the application experience where possible, by simplifying and automating the process, and factoring in market feedback.